Recently, I’ve stumbled upon a ”strategy” promoted by some Nigerian trader on one forum. His idea was quite simple — sell USD/JPY on some pivotal levels and don’t set up a
So, what’s your experience trading without
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November 22nd, 2010 at 3:01 pm
I have tried it some years ago and I am done with such a “strategy” (or lack of the same). I guess it works for some but position sizing is everything if you are trading this way..
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admin Reply:
November 22nd, 2010 at 3:18 pm
Position sizing is everything even if you don’t trade without stop-loss ;).
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November 28th, 2010 at 4:43 pm
In my opinion stop loss is used by the traders who do not know the trading machanism.Either take profit or take loss,no stop loss/profit.A trader,having the trading knowledge,plan to take the position at a certain place and firstly decide place of loss and if traded position goes in favour the decision of taking profit depends upon a special formation of candles.In this way loss will be minimum and profit maximum.ALL time graph should be on the screen with some tecnical studies i.e,bolingr,macd,rsi and 5 moving averages.15 minutes graph is the pivital graph and when a special formation of candles take place the positin is taken and profit/loss is taken again on the formation of candles.Before taking position the trader should decide,mkt is bullish or bearish, and it can be well judged from the three period graphs,daily,weekly & monthly.I have experienced more than 70% trades successful with big profit if not huge profit and minimum loss in case of unsuccessful trade.Market data is a deceiving activity and up /down of price rests only with technical machanism.
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admin Reply:
November 28th, 2010 at 4:57 pm
I don’t quite understand how what you’ve just said proves that stop-loss is used only by the traders who don’t know the trading mechanism? Are you confusing stop-loss with margin call?
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February 6th, 2011 at 12:33 am
stoploss is a trap used by wall street crooks to take money from innocent traders. Wall Street crooks never use stoploss, they know where they can take the market. They control the market, why bother with stoploss?
Only ignorant retail traders use stoploss “recommended” by wall street crooks.
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admin Reply:
February 6th, 2011 at 1:23 am
What do “Wall Street crooks” do when the market goes 10%/day against them and they are without stop-loss?
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March 16th, 2011 at 9:22 pm
I’ve been trading without stoploss for 5 years. However, I am very careful using my leverage. If I have 10000 in my account, I just buy 1 micro lot (1 lot = 1000). If I have 100000 balance, i just buy 1 mini lot (1 lot = 10000). It requires decipline and nerve of steel.
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July 27th, 2011 at 8:43 pm
Never put stop loss. I did one experiment with 100 dolars without stop loss and with stop loss. My strategy was if trend goes against you buy in another direction as it means same as stop loss just you not giving money for a big guys, so my 100 dollar in 1 moth grow till 4,500 and final stage it 100% profit, and after I did with stop loss I lost 100 dollar in 4 days, I did 3 times more and lost every time so in 4 days some in one week, I I was exhausted with stop loss. You never know what market will do next, only if you nostradamus or vodo or alien or educated in finance it may work, but not for ordinary people.
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admin Reply:
July 28th, 2011 at 7:19 am
You were lucky that the price fluctuated well through your hedged positions. What if you’d enter long position at near 1.4900 on EUR/USD without stop-loss?
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July 28th, 2011 at 5:25 pm
If you say enter long and after realised it against you, there is two ways, close position and give away yours hard earned many loss or sell it would be the same as stop loss except you are not giving your hard earn many for someone, and what warranty do you have if yours 1.4900 will go up to 1.6000 or 1.7000 it could go whatever it wants, do you know if it will go? probably not. only one man could tell you if it will go up or down, mother nature or alien or head of father bank.
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admin Reply:
July 28th, 2011 at 5:53 pm
You are right – it’s hard to know where the market will be going. But what you do is recommend to open a second position in addition to a losing one, considering that we don’t know where the price is heading. If one would open a EUR/USD long at 1.4900, it would mean more than 1,000 pips floating loss on July 12. If one’s trading on margin, it would probably hit a margin call for him. But even if it didn’t, it would mean that he’d still be in loss of ~600 pips and his money locked for almost 3 months. What’s the strategy if one has such position still open and the EUR/USD goes to parity? To 0.5?
If the main point is just in opening an opposite position instead of triggering the stop-loss, then it only looks that you aren’t incurring the loss from the first position. The moment you enter the opposite position is effectively the same as closing the losing. When you’ll close your opposite position in profit, if the first one (loosing) remains open, it would be equal to reopening the long position at that new level. It does nothing more than fooling you with false safety, spending more on margin and overnight swaps.
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August 1st, 2011 at 10:25 pm
Only one thing. I did experiment. It only my strategy. I know it crazy but for me its works. I can’t look every time I’m hit by stop loose, and for strange reason it always hits just in 1 pip and I’m off the market, after you hit by stop loss you have to think about new strategy. And just I’m not waiting till market will hit 600 pip loss, before open opposite position. And yes I’m closing losing positions but in only after I’m making profit. It just works for me this way, hate draining my account, better I will see in balance high amount of pips.
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September 29th, 2011 at 11:39 am
It is all about being patient. If u r using the bollinger indicator u should know the price will almost always oscillate between the two bands. It is a matter of waiting until the price recovers from one end to another. Of course a lot of adrenaline can flow but try to develop confidence.
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admin Reply:
September 29th, 2011 at 12:03 pm
Have you ever seen a long-term chart of a currency pair? You could get stuck for years (if not decades) with some positions without stop-loss,if you have enough margin, of course.
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November 27th, 2011 at 9:36 pm
I do know that, I could stuck for a years. I’m develop some sort of strategy without stop loose, it is pays off for me. Just I’m loosing confidence after putting stop loose and usually loosing, after confidence is gone what could be left. hopefully in time I will get enough confident and knowledge to trade with stop loss. And Thank you Pierre for advice I will take this in account. My personal indicator is stochastic slow and on some time frames RSI, I’m trying use indicators as low as possible, as in past they will miss lead you.
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admin Reply:
November 27th, 2011 at 10:02 pm
I am glad that trading without a stop-loss turns out to be a good strategy for you. Just don’t forget about the danger of margin-call/stop-out and that the money could be earn you more profit if you’d invest it in something other than the long-term losing position.
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December 2nd, 2011 at 9:00 pm
i think no SL is better ,but have discretionary exit based on chart.
e.g. i will give a good example. i did demo trades those who shorted AUDUSD,EURUSD,GBPUSD at around 1.0255, 1.3490, 1.5690, would have gotten stopped out last night, if they had a 70 pip stop loss. however those trades were with the underlying trend on all higher TF(which is down), and consistent with fundamentals (euro zone difficulty, US economic data still poor) and shorting after a large increase in downtrend is higher % probability, also they were close to their daily trend line a good place to go short
since i did not put SL in demo account( i am in asia time zone, so i will need to leave position running to gain max. benefit), i did not get stopped out for pointless 70 pip SL, instead it looks like i benefited:
aud/usd – 35 pip
eur/usd 85pip
gbp/usd 100 pip
or average since they are about the same thing about 80 pip, aud/usd not the best one to short fundamentally as higher interest rate(4.5%current – but if threat of eurozone it interest rate will go down causing panick to below 95 cents).
any comment. the only way i would have benefited would be to have an extra large stop loss(say 140pip), or no SL at all. my position was perfect 100% correct.
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admin Reply:
December 2nd, 2011 at 9:20 pm
Discretionary exit is also considered a stop-loss. You just don’t set it as an order with your broker, but you use it to prevent excess losses in case the trade goes in wrong way. Trading without stops means that you’ll wait until either profit target is reached or your broker stops you out due to the lack of margin.
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December 2nd, 2011 at 9:04 pm
another way would be have these factors if u are swing trader
1. hard wide stop loss like 140-150pip
2. good entry area(higher % entry)
3. helpful fundamentals for your position
4. extra discretionary exit based on chart, not related to no.1 (say if chart says bad on short term TF okay to exit prior to hitting full SL)
if u went short last night using those criteria u wouldve made gain. if u had a SL of 70 pips it would have resulted in a losser as eur/usd and gbp/usd had massive NFP spikes upwards, when the NFP numbers were disappointing
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January 14th, 2012 at 5:25 am
I was making more money on forex when I first started out because I ignored stop-losses and let my bad trades ride until they eventually came back and made a profit. Sometimes I would be down 70%, but I’d just leave it for three days and surely enough it would back and make a profit. Now that I’ve taken a trading course and continue to read trading books, I do nothing but lose money left, right, and center. For some reason practice makes worse. Stop-losses are death by a thousand cuts. I’m wonderin if perhaps the dumb approach is really the right one.
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admin Reply:
January 14th, 2012 at 9:45 am
The problem of comparing results of with/without stop-loss is that they produce extremely different trading outcomes:
1. With stop-loss, you are cutting your losses short and take many small losses with a comparable chance of getting some profit. In some short time you’ll be able to see if your strategy is profitable (has an edge) or it isn’t.
2. Without stop-loss, you cut your profits early compared to the losses and produce many small profits with a small chance of getting a huge loss (100% of the account usually). In some short time, you are likely to show some end profit, but in a longer period of time, a stop-out due to insufficient margin is inevitable and the end result is negative. But in the meantime it will give you an illusion of being right about the market quite a few times, preventing you from seeing whether your strategy has an actual edge or not.
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January 28th, 2012 at 11:34 pm
Here is the problem in these assumptions. You are discounting the one thing that makes any strategy work, and that it time frame. If you look at market trends, you wil realize that markets move in waves and wave within, that said no matter which way you will toss your trade you can expect that it will reatrace, or can you ?
The answer is not always!, but more often then not. The more often the not is the key. You cannot get attached to a single trade, and learn to manage your exposure and your margin accordingly.
They you can employ either strategy. The no SL strategy will be more profitable while you apply the rules above, but if you neglect the above you will fail. The SL strategy works well as well. Both are good, but no SL startegy MUST be augmented with Hedging. If you dont understand hedging, and are unwilling to learn then stick to SL.
Eventually if you look within a timeframe you will notice that it doesnt move always one way. For example USDJPY, even tho monthly keeps going down, there are spikes within, at which point you can downsize and reduce, or close even with profit on a well executed trade sequence.
It is about trade management and not SL vs NO SL, the one drawback to SL is that you have a fixed resolution on your trade management, and are unable to apply creative technique.
Best traders know both techinques and know to apply the right one at the right time.
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admin Reply:
January 29th, 2012 at 12:04 am
Wait, how do you augment no-SL trades with hedging? Because to me it seems that hedging can only worsen the case here.
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