Most traders focus on when to enter a trade. The pros focus on when to exit.
That's where Stop-Loss (SL) and Take-Profit (TP) orders come in — and mastering them is the difference between protecting your capital and watching it disappear.
What are they?
📉 Stop-Loss (SL): An order that automatically closes your position if price moves against you — capping your losses before they spiral.
📈 Take-Profit (TP): An order that locks in your gains at a target price — so you don't give back your profits waiting for "just a bit more."
How to calculate them:
🔸 Percentage Method
Set SL 2–5% below entry, TP 2–3x that distance above. Simple and beginner-friendly.
🔸 Support & Resistance
Place SL just below a key support level, TP just below major resistance. Let the chart guide you.
🔸 Risk/Reward Ratio
Aim for at least 1:2. If you're risking $100, your TP should target $200+. This alone can make a losing strategy profitable.
🔸 Technical Indicators
RSI, Bollinger Bands, and Moving Averages can pinpoint smarter SL/TP levels based on momentum and volatility.