Thursday, 15 August 2019

Trading Strategies Without Stop Loss

Reasons for Trading Without Stop Loss
For traders who are experienced, of course they have their own considerations why not use Stop Loss. They may already have a way to manage risk well without relying on Stop Loss.

1. There Is A Broker That Utilizes Your Stop Loss
By installing a Stop Loss, then you indirectly notify the Broker about the Exit plan at a certain price level. A number of brokers can use this to gain profits, especially if they are a dealer in the city (Dealing Desk).

As is well known, bookie brokers work against your trading positions. When you lose, they will get income. If you lose 1,000 USD, the broker will get income of 1,000 USD. This is how Bandar Brokers work.

Then what is the example of a bookie broker that utilizes member Stop Loss? In some cases, they can easily widen Spreads to capture a number of Stop Loss that are placed too close by the trader. Dealer Brokers certainly have the flexibility to do that if they really want it. Brokers like this are also known as Stop Loss Hunter.

 also read : 4 The most accurate iq option indicator strategy

2. Stop Loss Can Be Netted By Temporary Price Spikes
Market movements are indeed not easy to predict. There are times when the analysis is quite right, and prices are moving in the desired direction. However, you forgot to anticipate a temporary price spike. Yes, high volatility can sometimes be unavoidable.

As a result, the Stop Loss was touched by the False Breakout. This is indicated by the appearance of a very long Shadow on a candlestick. This makes the price move against the direction of your position until it touches Stop Loss, before finally moving back to your Entry position at the beginning.

3. Installing Stop Loss Makes You Big Head
Some traders consider Stop Loss as a safety device when they enter the forex market. Because they feel the trading will be safe with Stop Loss, they are too rushed to do the analysis, and even tend to trade recklessly. Supposing you ride a bicycle with safety devices. Because you feel you are wearing a safety device, you can just take a number of risks that are too dangerous in driving because it is too confident.

4. Potential Stop Loss Does Not Work When Slippage Occurs
This is what you need to pay close attention to. In market conditions with very high volatility, Slippage is very vulnerable to occur. This is a disaster for traders who feel safe because they have put Stop Loss. As is known, the broker can only guarantee you exit the position in accordance with the Stop Loss price level installed.

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