A very good example that you should trade with stoploss!
Traders often use different ways of working, technical, fundamental, price action, mathematical or combinations of these. I believe that no matter what strategy you use, you should always watch the fundamentals and use some form of stoploss, a killswitch if you want.
Yesterday there was a situation that could send you out in a big drawdown if you are a technical trader who does not use stoploss. Technical traders follow systems and signals that the charts give, some say they do not watch fundamental news that much because if you look back, the news is priced into the historical charts that are giving the technical setups, and this is very true but .. should that be a cushion for not having to pay attention when important news is actually on the stairs? I do not think so.
Back to Yesterday … on the chart here, there are probably some traders who sold on signals given by the market here, but at one point there was an announced news on GBP that sent the price over 100pips the other way! If you were in a sell without a stop loss at this point because it looked like the price was going to continue down, the market was calm and you had not watched the news, you went to grab a bite to eat and came back to this. The chart here is M15 where each candle is 15min, so already after 15 minutes you would have been in trouble.
My point is, “Yes, thank you both” With stop loss here, you would have taken a small controlled loss, if you had followed the announced news about GBP, you might not have been in the trade at all. Be careful and take precautions, the market can always turn around very quickly and then it may be too late.
Here on Trendline Magic you are very welcome to use the Trading Dashboard with a lot of tools like News calendar, technical summary, trader sentiment and more… a perfect place to start your trading day. Trade safe, have fun and prosper 🙂