TRAILING STOP

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A stop that moves up automatically with the price when the trade for which it’s set is in profit. For example, if a trader buys cable at 1.29000 with a trailing stop of 100 points, this trailing stop will be activated when price reaches 1.29101. If price them moves up to 1.29200, the trailing stop would move up to 1.29100. A downward movement to that level would cause the trailing stop to trigger and the order to close in profit. See also ‘stop’, ‘target’ and managing risk.

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