Trailing Stop Question?? Need help!!

Dear Fellow Members.

I am new to the trading and i have following question on Trailing Stop...

1. Lets say i sell eur/usd at 1.5156 with no take profit and stop loss of 1.5200

If the current Euro/uSD is 1.5000 and i put trailing stop of 100 pips at this point, how will it work??

2. If the eur/usd is 1.5100 and i put trailing stop of 100 pips how will it work.

HOW DOES TRAILING STOP WORKS...I AM TOTALLY CONFUSED....

Any help on this would be appreciated..???

thanks

Dear Fellow Members.

I am new to the trading and i have following question on Trailing Stop...

1. Lets say i sell eur/usd at 1.5156 with no take profit and stop loss of 1.5200

If the current Euro/uSD is 1.5000 and i put trailing stop of 100 pips at this point, how will it work?? * it does not work untill at 1.5256

2. If the eur/usd is 1.5100 and i put trailing stop of 100 pips how will it work.* it does not work, because you does not set limit (no take profit)

HOW DOES TRAILING STOP WORKS...I AM TOTALLY CONFUSED....

Any help on this would be appreciated..???

thanks
__________________
Thanks and Regards

Zamir M Iqbal

There are two of you there...

A trailing stop will put an SL - Stop Limit at the amount of pips you want behind the CUREENT price. If you're at 1.5 and you use a TS of 100 pips your SL is at 1.51 and if you went short above 1.51 than you've secured your profits from the price where you went short till 1.51. The trailing stop will move further down - below 1.51 if price moves below 1.5 - so it will always be 100 pips below the lowest price there was since you set the TS. But, it will never move back up, so your profit at 1.51 and below (if price moves below 1.5 and moves the TS down further) can only increase.

TS are usefull if you set up a trade and you're in profit but are looking for the trade to go more into profit. So you lock in profit a certain distance behind the price (no matter what the price is), and if it retraces too much - which could indicate it is reversing against you - the TS will close your profits at the TS distance you indicated from the farthest move into profit since you activated the TS order.

Good luck

On MT4 it won't activate until the current profit is greater than your trailing stop, ie 100 pips, so the price will have to move 100 pips in your direction before the trailing stop comes into play. Dunno why. I think it should move continuously.

That's actualy a good thing It means I could set my TSs ahead of time instead of waiting for them to reach 1/3TP or 1/2TP as I do and then set them manually. MT4 is an FXCM platform ?

Thank you I didn't knew this!
But in this case you ahve to have big moves in order to use the trailing stop..

Also another question is you use a platform that doesn't use metatrader can you be able to use a trailstop sooner?

Trailing stop is a trending technique, don't use it on small ranges or in places where the price is likely to reverse soon. You'll need a different exit strategy for those times.


Depends on the platform. Ironically MT4's trailing stop feature is coded this way, but an EA can change the behavior completely... so it's only one option even then. Ask your broker, some don't even allow trails. As trails are usually managed by your computer (not the broker) you'll need to keep your 'puter on, net connection going and stay logged in for the trail to update.