Stop loss is the last line of defense to protect the principal. We have always stressed that any analysis is naturally unstable, because the biggest feature of the market is change. Stop loss means that the facts have denied your previous analysis. Although you are not sure whether this denial is correct, your client has asked you to retreat strategically, so that the stop loss is absolute and the scope is conservative, and you can no longer rely on technical analysis.
Extended data:
Turn the tide and stop profit. Traders have a set of trading and fund management plans, and when making plans, they should have market entry prices and profit targets. When you trade with the trend, as long as it is a profitable position, you should hold it, the trend remains unchanged, and the position remains unchanged.
When the market price reaches the important support level and resistance level, we should pay close attention to the market trend and use various methods to analyze and study whether there are signs of improvement in the market. If you think the market has turned, you should stop making profits.
When you choose the right time to enter the market and trade according to the trading plan, it turns out that you are following the trend, so you should firmly hold your position and make profits with the changes of the market.
When there are adjustments, there is no need to make a fuss, or to hold positions. However, there is a situation where you need to close your position, that is, when the market price is adjusted back to the price at which you opened your position, and the profit of your position is almost completely eaten, you must stop closing your position.
References:
Baidu encyclopedia-take profit and stop loss