Setting more effective stop loss/trailing stops?

I've been paper trading a few months now, and I feel that one thing I need to improve is setting more effective stop loss and trailing stops. I've been using Mudd Buddha's Simple Forex system, but recently I switched over to the Sidus system. Both of these systems I've used mostly on 1 hour charts.

The problem I have, is that frequently my stop loss will be hit when the signals of the system I'm using are still good. I'll usually jump back in hoping my stop loss will not be hit a second time. Sometimes it does, and other times I'll watch as the price bounces back from my stop loss and moves the way I thought it would.

So basically I'm asking what should I do to set more effective stop loss and trailing stops? Usually when trading the hourly charts I'll set it somewhere between 25-30 pips, and occasionally I'll set a 20pip trailing stop on a trade.

How many pips are optimal when trading the hourly charts? And what about the 4 hour and daily charts?

Check my post here

http://www.forexfactory.com/showthread.php?t=307672

it must depend of your system. in general terms, in order to evade a squeeze you should set your stops in less popular place.

i am using meta trader 4 , i want to reduce my risk level but i find it difficult, before i was using higher time frame then i started using 5,15min. to reduce risk. as we know in mt4 prices bars value shows in five digit after point (for example 1.54869). so when i trade even on 5 min. there also my stop loss make me stop out , i usually put stop loss of 30 pips.

so can anyone explain me how to put proper stop loss and reduce risk. is it possible to make five digit price bar to four digit.
when i open trade on 5 min, it straight way goes into -25 to -26 pips even though broker spread is 2 pips. i don't understand why this happen even without much volatility.

can any one help and help to avoid this problem.
thanks in advance.

cheers!

Regardless of what platform you use the level of stop loss for any trade has to concern itself first of all with your entry price. If it does not then the retracement habit (back to supportive or resistant price levels) and normal ebb and flow of the market will close you out. It is quite simple and you will have entered the market in the wrong place and at the wrong time.

So understand why you are getting in at X and know where the market can go against you while it develops its current move UP or DOWN.

If there is already a sizeable move up or down then entry to BUY towards the top of the move is foolish, equally foolish is entry to SELL towards the bottom of the move. You would need to cover a lot of ground with your SL if you have delayed entry in these circumstances as you would be entering potentially just as a retracement will set in.

makingpips

Do you understand, and more importantly use, POSITION SIZING?

Simply placing a fixed Stop Loss at 30 pips is not smart trading.

Place the Stop Loss above or below a recent swing high or low, if that is what your method calls for, the use a calculator like this http://www.earnforex.com/position-size-calculator to work out your trade lot size at your % level of risk.

Do that for 20 trades or more, see how that works