How do I place a stop-loss order?

Traders use stop-loss orders to either reduce risk or safeguard a portion of their current earnings in a trading position. Every time a trade is made, a trading platform often gives the option of placing a stop-loss order, which can be changed at any moment. Once a price threshold is reached, a stop-loss order essentially turns on a market order. Stop-loss orders are initially intended to cap potential losses from the trade. For instance, a trader in foreign exchange would issue an order to buy EUR/USD at 1.1500 and a stop-loss order at 1.1485. As a result, the trader's potential loss is capped to 15 pip.

 

Stop loss should be under the market level if you're opening a long position. 

Stop loss should be over the market level if you're opening a short position. 

 

On website,

  • While opening a position on the 'order entry' screen, you will find 'stop loss order'.
  • By clicking on an existing position you can set a stop-level amount.
  • If the market price comes up to a stop-loss level, positions are closed automatically to limit potential losses.

 

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