In this video, you will learn about placing a stop-loss after the price breaks out of a channel. There are two ways to enter a short position after a channel breakout. You can enter after the candle that breaks the support or the lower line of the channel. A better way to place the trade which offers a great risk-to-reward ratio is to wait for a retrace to the upside and retest of the broken support or the lower line of the channel.
An aggressive way to place your stop-loss is to place it above the candle that broke the support. However, you have the market gapped down after the breakout. So, you can place your stop-loss above the previous candle.
When you have entered after the retest of the lower line of the channel, the market may spike higher and fall lower. In this case, you might have got stopped out of the trade and missed a nice trading opportunity. So, you can place the stop-loss above the swing high before the breakout occurred.
