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Forex indicators How does trailing stop work?
avatar Catkathy
Question by: Joseph - 27 Jul 2016, 08:35:12
How does trailing stop work?
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Answers (1)
avatar user 10227
Answer by: Samanthar - 27 Jul 2016, 09:14:50

The trailing stop is used to lock in profits. For example, you buy GBP/USD at 1.8241, and place a stop at 1.8231, with the trailing stop feature set at 50 pips. If and when the GBP/USD rate goes to 1.8291, your stop loss order will automatically move to 1.8281. This would lock in a profit of 40 pips. The stop loss order would move up continually every time the GBP/USD rate increases by 50 pips.

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