Profits and Pet metallized film losses go hand in hand. They feel if they use stop loss order, they will have to automatically move out of the market. After having bearing such a shockingly high loss, you tend to hold onto your position in the hope of recovering some amount. This in itself explains the reason why this market order is called 'stop loss order'. At the end of the day, you will walk out of the trading room realizing that you don't have substantial amount to trade again. Though, you cannot completely keep away from losses, but, you can definitely strive to minimize them to a considerable extent with the help of 'stop loss order'.
To trade in forex market, you have to think from your mind; not from your heart. At a later stage, the time comes when the forex trader does not have any option but to withdraw. Some people get traumatized due to the aftermaths of poor trade deal. He/she feels that now there is no other alternative because otherwise his/her family would have to live hand to mouth. Here it is important to note that even though 'stop loss order' is so important, still a large number of forex traders tend to ignore it.In forex trading, stop loss order is one of the most potent tools that you as a trader can use in case the market trend takes a turn, thereby moving against you.
The psychology of most of the forex traders is that it is better to wait and watch because you never know when things might turn in your favor.
If you accept profits in forex trade; you must agree with the losses also; which is obvious in any trade you indulge. It is basically a market order that prevents forex traders from incurring enormous amount of losses in case of unfavorable circumstances.
Before discussing further, let us first attempt to understand the relevance of 'stop loss order'. Quite amazing!
There can be times when there is nothing to gain on the trading floor but despite that if you do not place your stop loss order, it is likely that you might suffer heavy losses. But, unfortunately, humans are highly emotional and it is these emotions that many a times prevents them from putting a stop and closing the deal. In such a case, they won't even get a chance to try their luck again in the forex market. When losses are almost inevitable, it is better to improve your position in the market and prepare yourself for the tough time. They believe it so much that they keep sitting even when things turn worst but do not place the stop loss order to minimize further losses! They keep on following their instincts that everything is going smooth and as time passes by, the situation will be better. It is meant to safeguard the interest of the traders. To be successful, you need to do a technical analysis of the foreign currency exchange market. Forex market is governed by a trading pattern that you need to understand as well as follow. It is here that stop loss order comes to the rescue of forex traders