Stop-Loss (SL)

Definition

Stop-Loss (SL) in plain English

A stop-loss is an order you set in advance that automatically closes your trade if the price moves against you to a level you've chosen, so a bad trade can't quietly bleed you dry. Think of it as a pre-set 'get me out at $95' instruction on a stock you bought at $100 — the moment it hits $95, you're out, no agonizing decision in the heat of the moment. Its whole job is to cap your worst-case loss before the trade even starts.

Learn these first

• R:R (Reward-to-Risk ratio)

Related Volume Profile Analysis terms

• Absorption
• Developing POC
• Initiative activity
• R:R (Reward-to-Risk ratio)
• Rejection
• Revenge trading
• Session Profile
• Trailing stop
• Value Area High (VAH)
• Value Area Low (VAL)