From TradingView · · 50s
Where to Put a Stop-Loss: Swing Level + ATR Buffer
How to set a stop-loss using swing levels and ATR buffer for EUR/USD trading.
In brief
How to set a stop-loss using swing levels and ATR buffer for EUR/USD trading. For EUR/USD, place a stop-loss beyond the swing level by 0.5 to 1 ATR to manage risk effectively. Originally reported by TradingView.
Where to Put a Stop-Loss
Most beginners place a stop-loss a fixed number of pips away, like 10 or 20.
Step 1: Find Invalidation Level
For a long trade, the most recent swing low invalidates the trade.
Step 2: Add ATR Buffer
Add 0.5 to 1 ATR beyond the swing level for volatility-based buffer.
Step 3: Size Position from Stop
Calculate position size from stop-loss to manage risk at 1% per trade.
The short version
For EUR/USD, place a stop-loss beyond the swing level by 0.5 to 1 ATR to manage risk effectively.
