Tight Stops in Currency Trading

Discussion in 'Chit Chat' started by highseas, May 13, 2010.

  1. highseas


    I wonder if anyone has put in a tight stop-loss order in currency trading and (kind of deliberately) forget about the profits. Let's say this stop-loss is near the low, as the EUR/USD pair is right now. In one weeks' time you probably will have a small loss due to the stop loss order. Or you may find yourself making a huge sum from even a $1000 investment. (To avoid huge gaps up or down maybe start on Sunday evening and end by Friday).

    Has anyone tried this? What has been your experience? This will be kind of like "investing" rather than "trading".

    (I ask because sometimes even when I guess the direction right I cut my winners and let the losers run. Putting in a stop and then "walking away" so to speak, may help pulling in those bigger winners--or so I think).
  2. irniger


    With daily hilo spreads of 100 - 300 in EURUSD, what's a tight stop? And should it be a trailing or fixed stop? Even the hourly spreads are often in the 100 pips region.

    An adaptive stoploss on the basis of the past xx bars might be a solution.
  3. you have to be prepared to use volatility stops. the wider the stop the better ofcourse you have to be on the right side of the market though.
  4. jsmooth


    I'll trade the Euro Futures (mini & full sized contract), and I'll always use a 10 tick stop on all my trades and always try to establish an initial position, then if its "working" scale into it. I really let the market tell me how many contracts i scale into - but my max is pretty much 10 mini - 5 6E. if the market is trending, or you're trying to pick a top, you should be using a tight stop to initially get into the position on small size, then ADD to the position once you get into a winner....then try to scale out. How fast you scale in/out obviously depends on the type of timeframe trader you are - same with your initial stop loss tick amount. Below is a screen shot of a trade from a few days ago in the mini euro futures....The date and time is listed, sorry i dont have any charts, so hopefully you'll have a chart from Monday sessions to visualize it if you need to.

    If your trying to scalp the currencys, i would suggest trading the currency futures.....this thread should probably be moved to FOREX....not chit chat...