Forex Trading Breakouts
Suitable Forex stop loss day trading m5?
I am stuck between using a 5 or 10 pip stop trading the m5 charts, please help! My stratgey is based on break of support/resistance, therefore I believe a tighter stop could be used because if price is going to breakout it should not be turning back 10 pips. However I need someone experiencd to help?
On the 5 min – I’m guessing you’re trading one of the major pairs like the EUR/USD. The answer really depends on what swings you’re playing
My advice would be to
control risk/reward – don’t have your stop at 10 pips if you only expect to make 5. It should be at the very, very least 10 and preferably much more.
Watch the markets and try to define where the best “point” to place the stop – this is the price at which if it is hit your target will likely not be hit. For trades similar to yours I put them around the 80% retracement of the prior swing (I think there is a fib like .782 which I used but haven’t traded since the summer).
Really, just watch the market, watch the market, watch the market, be creative, be smart, and protect your money.
Phil Newton’s Break out Strategy | Price Action Forex Trading
