How to Set Stop Loss and Targets: Risk Management Made Simple
TradeCraft makes it easy to set smart stop loss and target levels for every trade. Get optimal levels based on volatility, support/resistance, and your risk tolerance.
1. Volatility & Support/Resistance Analysis
- ATR-Based Stops: Calculates stop loss using Average True Range to account for normal price swings.
- Support/Resistance Anchoring: Places stops just beyond key levels to avoid getting shaken out by noise.
- Dynamic Adjustment: Adapts stops for high-volatility or news-driven stocks.
2. Target Setting Logic
- Risk/Reward Ratio: Default targets are set for at least 2:1 reward-to-risk, but users can adjust as needed.
- Measured Move Projections: Uses chart patterns and recent swings to estimate realistic targets.
- Multiple Targets: Optionally set partial exits at different levels for scaling out.
3. Visual & Workflow Features
- Chart Overlay: Entry, stop, and target are shown visually for every plan.
- Editable Levels: Users can drag and adjust stops/targets and see updated risk/reward instantly.
- Risk Calculator: Shows position size and dollar risk for every trade.
Why Use TradeCraft?
TradeCraft makes disciplined risk management easy and visual. You’ll never have to guess where to place your stops or targets again.