Trailing stops in forex

How it works

The trailing distance can be fixed in points, pips or another measure depending on the platform. Once price reverses enough to reach the updated stop, the exit instruction is triggered.

What to check

Check whether the trailing logic runs on the broker's server or only while the trading platform is connected. Also check the minimum distance and whether the stop moves continuously or in steps.

• Check where the trailing logic runs
• Choose distance deliberately
• Expect ordinary volatility

Limits and risks

A trailing stop can lock in gains but can also close a position during ordinary volatility. Like other stops, it may experience slippage unless execution is guaranteed.