Determine Take Profit & Stop Loss (Support and Resistance)

There are 3 Main Points to consider

1. Let the chart/graphic that shows us where we should place the stop loss

Optimal Stop loss should be placed under the support (in long position) or above the resistance (in the short position).

The most important thing when we are trading is realized when we should exit from market when our position as opposed to the actual market direction, it mean we have to stay put a stop loss and change it when the market friendly to us. The best place to put the stop loss is above resistance or below support, and change to levels that may form later.

Determination of support or resistance can be performed after measuring the range of price movement and taken an extreme high level (Resistance) or extreme low level (Support) on the chart.

In a trending market conditions "Trend is your Friend" usakan trading just follow the trend form. If in the bullish trend condition it is preferred to only take long positions only and ignore the short position. In a bearish trend, the preferred conditions only take a short position.

2. Make sure that each entry position has a higher ratio of reward than risk.

On each trading make sure reward that we will receive greater than the risk. The greater chance of reward, and the smaller chance of risks that might happen, psychologically and reviewed from the risk management standpoint it is very helpful.

Always place the limit of profit as obejective price where we will exit the market in the profit.

3. Notice Time Frame to be used (1 minute, 5 minutes, Daily, weekly, etc)

- Each time frame has a profile of risk/reward and determine trading method that will be used.

There are other things also to be considered in the placement of stop loss:

• Watch another confirmation of the technical indicators, chart patterns or candlestick patterns.
• Do not make entry buy just because prices have touched the support but also note other indications that support a reversal signal when price touches the support.
• Take the profit should be placed before the price touched the resistance (for long position) and before touching the support (for short position). so the probability of take profit will be even greater.