Your stop loss may be too tight

@george_kramer - 15 hours ago - Risk Management

There has always been this raging debate about where to place a stop loss and what the monetary value of each stop loss should be. How close is too tight and how far away is too wide? Inputs please !

@sandy20 - 15 hours ago

I always place my stop loss a distance away from the nearest session high or low. That being said what is the actual distance away? For me i use a formula 10 pips plus spread. So, if the spread on the instrument I am trading is 3 pips, then my SL will be 10 = 3 = 13 pips away from the nearest session high/low

@mercury01 - 12 hours ago

I face this dilemma too, its a real pain in the ass.

@orokpo1 - 6 hours ago

Place your stop loss at a level that invalidates your reason for entering the trade. The best locations are typically beyond key technical levels, such as just below a major support (for long positions) or just above a resistance (for short positions), to give the trade breathing room.

The most effective stop-loss strategies rely on market structure and volatility rather than arbitrary numbers.

For Buy (Long) Trades: Place your stop loss just below a recent swing low or established support zone. If the price breaks this level, it signals a trend reversal.

For Sell (Short) Trades: Place your stop loss just above a recent swing high or resistance zone.