Trading without stop-losses

im using micro
using stoploss only when i must leave my forex trading.

If you trade with higher leverage you should use stops. My entries are usually 1:1 (leverage), I don't use hard stops there... It all depends on your system/approach.

so risky..

I dont use SL and i'm a full time trader. That's one of the key. The people who is denying dont know anything about invest/trading. Sorry about that guyz but open your eyes.

Good trade...

My first post. as a newish trader, Why would you trade without the security of a stop-loss?

I am also new here and open to other opinions, but as I see it :-

A stop loss can be hit by a stop hunt / fake, a stop hunt is where the big boys push the market in the oposite direction for a short period of time to hit the stop loss of retails traders ( taking their money ) because it is reasonably easy for them to gauge where the stop loss limit will be set by the majority of retail traders. Sometimes the stop hunt will look like a forming up trend which may cause more retail traders to buy when the market is actually about to go down ( or other way around ) and my understanding is that this is more of a fake than a stop hunt.
Stop hunts are often sharp spikes and fake's can look a bit different.

I think that you at least should have a mental stop set if it is not logged in to your trade, but I think if you do this you need to be able to cut your loss without hope getting in the way, easy to say but not easy for all to do !

If you have no SL logged in to your trade and there is a stop hunt spike up/down on a short/long postion you will not get knocked out of the trade.
Disadvantage = dangerous if you are not experienced in the markets and able to recognise what is really happening, or if you hang on to hope when it goes against you and are unable to take the loss.

I have experimented with dummy trades in 1 / 5 min charts without using stop loss and lost more than I made, this is not to say that it cannot be done well, I am just saying that I am unable to trade this way at present

IMHO,

you're doing very risky work here.
you don't put trading as same as other business.

the reason is we don't know when 'the big guy' comes into market and take away your position.

I think that trading without a stoploss is just non realistic. For every trade I take I define a risk, that risk reflects my confidence in the trade. Trading without a stop is like having sex with a hiv positive hooker, it's dangerous.

Well, that's just rude.

Interesting topic. Stop losses really depend on how much you trade on a trade. For Example if I put a 1000 pip SL when I enter a trade but I multi level trade, (use more than one trade entrance on a currency pair) instead of the one and done approach then SL become non existant in actual use. (Multi-level not the same a Martingale a whole different animal) If your lot size is small enough as compared to your account size and you know how to countertrade then SL are not necessary. For example if you trade with 1000 dollars and you trade ten cent lots it would take a loss of 10,000 pips to wipe out your account. If you are that bad of a trader you shouldnt be trading. However, with a 10,000 pip range you can easily counter trade your way out of trouble. In fact I believe in any 1000 pip range (with the exception of super news stories like OCT. 2008) you can counter trade any loss back to almost zero. So even though I place a SL I dont ever use it.

If you have 1000 dollars and you trade one dollar lots or bigger, then you have to have SL or you chance wiping out your account or getting beat badly on any one trade. So it really depends on your style of trading. SL only become neccesary if you dont know how to counter trade a losing trade back to even. If you know how to counter trade a losing trade back to even, then you dont need them or very seldom use them. So that is the key.

power outage, internet down, terrorist attack, fed unscheduled announcement, heart attack: things other than money management. You can add to the list.

as a rule, for the average ff member trader stoplosses might be a wise policy..... this includes me for sure.....

in a single live ibfx mini account i've had over 7000 trades so far this year, 2010.......

my initial ea placed orders stoploss's tend to be large, 300, 500, or 900 pips as a rule..... it's very seldom they get hit.... so rare in fact that trading without them would be no big deal...... but none-the-less they are there.... just in case......

they are there not to stop my losses, other ea code does that.... they are there as 'hopeful' emergency backup, just in case the ea code can not do it's job......


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it's very seldom i place a manual trade...... if for some reason i do it's sent without a profit target or stoploss, just easier that way..... on the next tick an ea will see the order with no tp/sl and modify it at once....


stoploss's are no true guarentee of anything..... still it's hard to see any harm in using them......h

Trading without stoplosses means that you need to have a perfectly run system with no surprises. Noobies trading without stoplosses is heading for disaster

Trading without a stop-loss is like committing suicide

One of the problem with traders is they get a thought in their brain and they cant think it could be any other way. I post my trades every day at FF factory. Here are my results over the last 10 months. You do not have to use SL to be successful. You do have to have a plan however, I did not become a successful trader until I threw out all these rules you were suppose to trade by. I dont use SL and I dont follow the trend. Here is my success story. I post my trades every day before I take them so everyone can see. I have not committed suicide I have succeeded. I have had 8 profitable months and two losing months.

+5597 pips since Aug. 16 to Dec. 31.
Aug. 2009 Total +1020 pips
Sept. 2009 total +2651 pips p. 27 post #396
Oct. 2009 total + 1335 for the month P. 39 post #579
November 2009 +1628 Pg. 48 post 709
December 2009 -1006 our first negative month. p. 57 post 841
2009 total pips +5597 p. 57 post 8412
I guess I can be happy with that. http://cdn.forexfactory.com/images/s.../yim/happy.gif

2010 trades total pips by month
January 2010 for the month +1757 pg. 65 #963
February 2010 1595 pips pg. 77 post 1146
March 2010 +2575 pips pg 83 post 1233
April 2010 +4951 p. 100 #1491 My best month ever and two people voted against my system during my best month SHEEESH.
May 2010 -3386 Got caught with our pants down on the Euro news stories but we have righted the ship and coming back.
2010 total +7482

If + 13,079 total pips in 10 months doesnt blow your mind then nothing will and remember I post every trade before I take them every day.

hey forexexfx..... agree..... disaster's residents are very likely evenly divided between the noobies and the experienced..... at least the noobies have an excuse ....h

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hey karmo..... or riding a motorcycle without a helment..... looks cool ..... but is it worth the risk......h

An experienced and successful trader like you might consider that a rookie might read your post and decide trading without a stop loss is OK. Of course, if you know what you are doing then it might be, but unless you're going to give a full explanation of how you get away with it then it's reckless to write a post like that. In fact your post just looks like showing off.

Most professional traders use a stop loss. Some would call it a "catastrophic" stop loss and manually close a losing trade way before it's reached.

I know lots of traders who trade with out SL. You dont trade with high lot versus margin. Again my example was a dime versus a 1000 dollars. It would take 10,000 pip loss to wipe out your account. Once you learn counter trade techniques you understand why. As far as I know I am the only one who teaches these publically but they are used by many big time traders. They dont take losses they zero out trades with counter trades. It is a trading skill. Anyway here is the thread and it will violate most of what you have been taught publically.

http://www.forexfactory.com/showthre...=1#post3783402

Very simply without going into detail, after one year of trading the so called magical trend I stopped trading, threw out all of what had been taught and I just studied blank charts. I saw something that was 100% true all the time. What goes up, must come down and what goes down, must come up. Now I trade those changes in direction, found it much easier than trying to follow a magical trend that noone seems to know exactly when it starts or when it ends until after the fact. You will see I will post, this is what I am going to do tomorrow (before every JPY session) not this is what I did or you should have done yesterday which is what almost every so called guru does in every post, book, chart, you name it, I have seen. I will say this is what I am trading this day and why. Countertrend trading is much more succesful than trend trading. I rarely take a loss, I do successfully zero most of my bad trades. Once you master the skill of zeroing out your bad trades you look at Forex so much differently than everyone else.

What is the advantage of not using a SL?

I do not get it. I am a newbie, and -so far- I do not see any plus not to use it.

Also I have noticed some previous posts express trading performance in terms of:

1) % of winning trades
2) number of pips.

Again, it may be only because I am a newbie, but -as far as I can understand- the goal is:

a) preserving your money
b) hopefully getting more money.

Problems I notice with performance measured as per 1): nothing is said about risk/reward ratio.

Despite the fact that I am a newbie, I think I can easily design a trading algorithm winning most of the times.
How? SL: 1000+ pips; take profit: 1 pip. If you have a broker with very tight spreads, it is really unlikely you get the max/min price.

There is a big caveat though: that one time you are on the top/bottom, you are screwed; since your reward/risk ratio is so low, money-wise your account will get a huge drawdown.

As per 2): again it strongly depends on the trading strategy. I am not saying that many pips are bad, I am just questioning how long it will last if the risk involved is huge.

No SL to me means: you do not want to accept a loss, which is a part of the game.

IMHO a high risk-reward ratio optimizes the number of times that you are a 'winner' (you will hit a TP instead of a SL); but that is far from optimizing your portfolio performance.

I am interested in preserving my account and, hopefully, get some money out from inefficiencies of the market, given that -in any case- I am sure I may be on the wrong side of the market. That is why, to me, a high risk-reward ratio does not make sense.

So I personally use tight SLs and I even move them to BE as soon as the chart allows me to do that (which does not mean as soon as the price is reached, but as soon as there is 'enough' room for me to move the SL). Of course that implies that sometimes I will not get the whole movement and I will be out sooner than expected; but am trying my best to achieve a) before b). It is not one movement of the market which will have a great impact on my account, I am actually looking to repetitive and consistent results.

Just my two cents about.

Pardon for making an demo'er's inclusion, but I've an opinion:
It's a matter of perspective.

I've done what you say. Makeup trades feel to me like a slippery slope, like your SL, implied or physical, didn't allow for enough pips of in-trade drawdown. If the trade's plainly wrong, the SL helps protect the trade versus its maker.

A consensus I've understood from others was that:
A really small trade, an SL will hit anyhow, unless you hold it for forever, at which case no or a really big SL works.
A medium trade, an SL keeps the pace going, to objectively compare each trade while protecting for that short time when not watching the trade.
A longterm trade, no SL says it's enough to have the smaller amount invested with a much larger range allowed for the trade.

The best advice from a real-money trader I've read was that one may get the technical interpretation of an entire area of cycles of trends and countertrends, and then study more and trade each of them. Then, if one misses a trade, there's always the next one.
This perspective gives a sense of control I've not seen with other approaches.