Stop loss, take profit and other exits

Stop loss

Every trade has a stop loss. Choose how it's placed:

• Fixed distance in points. A point is the smallest price step (0.00001 on EURUSD).
• A multiple of ATR, for example 1.5 × ATR, so the stop widens when the market is busy.
• Beyond the recent swing: past the lowest low (for a buy) of the last N bars, plus a few points.
• At an indicator line, for example a moving average or a band.

Take profit

• A multiple of the stop (R): 2 means the target is twice as far as the stop.
• Fixed distance, a multiple of ATR, at an indicator line, or none (let other exits close the trade).

Extras

• Move the stop to break-even once the trade is a set number of R in profit, plus a few points if you like.
• Trailing stop: follows the close by a multiple of an indicator (usually ATR) and only ever moves in your favour.
• Close after this many bars: a time exit (0 means never).
• Close (and reverse) on the opposite signal: a sell signal closes a buy, and opens the sell if sells are allowed.

The stop distance also sets the trade size: see Risk and prop guards.