Hello! Forex Learners, as you know, Forex has lots of tools, the Stop Loss (SL) and Take Profit (TP) are the main tools of Forex. The Stop Loss meaning is to Stop the Loss, in the explanation I would say that means you are ordering to the MT4 that if position reached to your Stop Loss price the trade should close automatically at the specific price in the loss. And the Take Profit means to Take the Profit. Same goes here as well that means you are ordering to the MT4 that your position must close at the specific price which you have set in MT4 chart.
For Example: After analyzed the chart of EURUSD Pair, you decided to buy at the price of 1.3350 and want to stop the trade automatically after getting the profit according to your analyzation at the price of 1.3390 (40PIPS), and the profit will auto added to your account.
So to do this, you need to set the ‘Take Profit’ price=’1.3390′ in EURUSD pair to close the position after completing the target automatically. The same with Stop loss, if you not sure about the market condition and you want to keep your account safe from big amount loss, you need to set the Stop Loss. For Example: If the market goes up, you’ll get 40 pips profit that’s good, but if in case market goes down it means against your trade you will get loss, so now you want to set the loss in your MT4 terminal to auto close the position if the market reached your Stop Loss Price, to do this you need to set the Stop Loss at the price of i.e. 1.3330 to automatically close the position, when your trade goes 20 pips down.
As you can see, after setting up the Stop Loss and Take Profit, you can keep control on your trade. And also you don’t need to sit in front of your computer or laptop to manually close the position. Also, your account will also be safe from any sudden moves in forex market due to any fundamental news. That’s why we said, the Take Profit and Stop loss are the main features of Forex Trading Software.
The use of Stop Loss and Take Profit feature is not only for those traders, who can’t sit in front of this PC or laptop but these tools can also be helpful for other purposes, like: any sudden movement of the market, this is kind of warning you that do not trade without Stop Loss because, forex market can make any sudden moves anytime and can move 100 – 200 pips up or down, so there is the highest chance of getting loss/profit that’s why we recommend each and every of our Forex students to always set the Take Profit and Stop Loss immediately whenever you open up the positions. It can also help us if in case suddenly we have internet or electricity down or cut off etc. but our positions will still safe if we have set TP& SL.
I think, I have tried my best to cleared you everything about Stop Loss and Take profit features of Forex Trading Software, However, if you still have more questions related to Forex Trading, then Please go ahead and ask us on a comment section below of this article.