Where to Set the Stop Loss?

When you open a demo account you will find on the online trading platform that you will always be able to enter a stop order level that will automatically stop out your trade at the level you set, or a limit order that will close your position at your desired profit level.

Using the FPS means that you should always set your level just below the EMA 50. As your position moves in the right direction, you should move your stop accordingly. Then if your position moves against you, you would have locked in your profits by moving up your stop order. It is important that if the prices cross back over the 10, 25 and 50 that you close your position.

Here is an example of how the FPS works on the 15 min charts:

Using the FPS on the 15 min charts is more volatile, but it will give you more trades on an intra-day basis. On the example above you could have sold the USD/CHF ‘short’ at 1.5060 and closed your position at 1.5000 for a 60 pip profit.

One note of caution trading the 15 min charts: there are often times when the price will ‘whipsaw’ back and forth, up and down through the 10,25 and 50 moving averages. If this happens soon after you entered a trade, close your position and wait till the moving averages fan out and the Parabolic SAR signals strong.