Essential 6 min read
Where to put your stop loss
Not "below the candle." Below structure. Here's how to find structure on a 4H chart.
A stop belongs below the level that, if broken, actually invalidates your thesis — not an arbitrary distance below your entry. For a breakout trade, that's below the pattern's low. For a pullback-to-support trade, that's below the swing low that defines the support.
Tight stops that ignore structure just mean you get stopped out by normal noise and then watch the trade work without you. If the structurally correct stop makes your position size too small to matter, the answer is to skip the trade — not to move the stop closer.