You may have followed your technical analysis and even checked out the latest news FXCM Markets Metatrader 4, but the market still went the other way. It’s not a big deal, you realized the mistake and immediately closed your position before further losses occurred. If you missed the moment of realisation because you weren’t in front of your computer, and your account went to zero. You could lose money when the market moves against you after reaching your goal. Your Profit could have turned into Loss because you were away for a few seconds or to get a cup of coffee.
When placing your Forex trading orders, it’s a good idea to set Stop loss and Take profit levels.
The Stop Loss is the limit price you have set to your order when you feel the market moving in the opposite direction. This helps to prevent your account going zero if the market moves strongly.
Take profit: The price limit you have set for exiting a trade once your desired level of profits is achieved. You can use this to protect your profit in the event that the market turns in the other direction after reaching your target level.
The stop loss limit moves along with the market price. When the market moves to your advantage, your stop-loss limit will also move in that direction.
If you are trading Long/Buy, and your Trailing Stop Loss is set at 10 pip and the Take Profit at 30 pip. If the market goes up 20 pip in your favour and then in the opposite direction, your stop loss will also move 20 pips. Your original Stop Loss, which was set at 10 pip below your entry price, is now 10 pip above it. If your Stop Loss was hit, you would still make a profit of 10 pip in this trade. A trailing stop can help you make profits, even if the Take Profit Target is not met.