Placing your initial stop loss
Where to place your initial stop loss.
Multiple articles in these docs show you how to enter a TrendMaster-based trend. However, it is part of good risk management to have a stop loss in place in your initial trade plan. With TrendMaster your initial stop loss placement is simple.
- When entering a long your initial stop loss sits at the low of the signal candle.
- When entering a short your initial stop loss sits at the high of the signal candle.
If you want to give your trade a bit more breathing room and decrease the chances of getting wicked out you could turn your attention to the ATR ribbon once more and use its values instead. However, this adjustment should also impact your position sizing since you're widening your stop.
The initial stop loss placement is on the candle low or high.