Stop-loss orders in forex

How it works

It can automate risk control and reduce the need for constant monitoring. The order is only as effective as the execution rules and available liquidity when the stop is triggered.

What to check

Place stops using the market structure and the amount of loss the account can tolerate, then confirm whether the broker offers ordinary or guaranteed stops.

• Define the risk before entry
• Check trigger rules
• Do not assume a guaranteed fill

Limits and risks

An ordinary stop-loss limits decision delay, not necessarily the exact loss. Gaps, slippage and widened spreads can produce an exit beyond the selected stop level.