Forex Opportunities – Strategies for Forex Trading › Forums › Trading Q&A › Trading Discussion Group › how to protect your capital? › Reply To: how to protect your capital?
keeping your stop losses tight is a must
soft stops are always a way to get margin calls
but are you placing a right stop loss?
sometimes you bring loss to yourself because of misplacing your stop loss
stop loss must be placed upon analysis only, and always keep on mind to get a little bit far from the tech. point and not exactly on it because this point will work as support/resistance point which means price may hit your point and return in the right direction
i see many traders acting in a strange way; they just decide that their risk in a trade is 30 pips for example and place the stop loss depending on this idea and ignoring any technicals, these kind of acts are a complete mess.
as for risky trades, for myself i prefer involving in trades with a 2/1 ratio(reward/risk) which means if the reward wasn’t double the risk i won’t get in it
also note that any irresponsible acts turn a safe trade into a risky ones, such as maximizing the lot size or opening new trades just before news releases, this turns you from trader into a gambler