learn how choosing smart stop loss in the forex

this is the steps

1. If cost is close to recent high or low then place SL 5-10 pips above or below that point. This is very important. Prices do go back to test recent highs and lows and we need to set SL as per the recent price action. Trading on daily chart is bit tricky where such SL can be even 30-40 pips more on top of your static 100 pip SL

2. Another point to take care is that don’t place SL on important boundary numbers such as 00 or 50 mark. These points are tested often and you can easily be stopped out

3. Place your stop loss on odd numbers excluding 1 and 9. Ne'er place SL on even numbers.

Trust It or Not!!!

Allow me surprise a few of you of saying that Brokers HUNT for your SL. That’s true. Forex is unlike Dow where everything is run by one organization and prices don’t vary from broker to broker (those broker makes money by giving you a worse fill than you would expect + commissions). Brokers in Forex can manipulate prices as they like and hence they go after your SL.

At present why brokers will want to you to loose?? Well every time you open a position, a broker opens an opposite position. So when you loose they win. They also want you trade more often, since they make money either in commission or spreads (or both). The only way they can force you to trade again is to stop you out.

Why you think brokers give out free market research and trading ideas?? If all of their traders are trading the same way then it is easier for them to take them out.

I'm sure that a few people would disagree (the ones working for broker) but it is something to think about.

So How To Beat The Brokers:

Simple, don’t place any Stop Loss. That’s right. It is not a typo. What you need is a Mental SL. You should know at price you will take your losses and set up alarms on your trading station when the price reach around the mental SL you had in place. This can be challenging for some people but if you're lucky enough to get this working then there's nothing alike them.

Hope these helps you in placing better SL by now on