I just realized that many new traders entering the market do not fully understand how to manage their trading orders. Today, I want to share some very important things I’ve learned after years of trading.

First is the concept of Entry – simply the point where you decide to buy or sell an asset. If you close the order exactly at this entry price, your trade breaks even. This is the most basic thing everyone needs to understand.

But what’s really important is Stop Loss. I’ve lost quite a bit of money because I didn’t set a Stop Loss or set it too close to the Entry. Stop Loss allows you to automatically cut losses when the price moves against your expected direction. For a buy order, the Stop Loss must be lower than the Entry; for a sell order, it must be higher than the Entry. The trick is not to set it too close to the entry point, because the market often fluctuates strongly and can unexpectedly hit your Stop Loss.

Next is what is Take Profit – this is an order that helps you automatically lock in profits. When the price reaches your desired level, the order will automatically close the position. For a buy order, Take Profit must be higher than the Entry. For a sell order, it must be lower than the Entry. Understanding what Take Profit is will help you avoid greed and losing the profits you’ve already gained.

The advantage of setting both orders in advance is that you save a lot of time. No need to constantly watch the screen, and you won’t feel psychological pressure while trading. You can also optimize profits by setting a smaller Stop Loss compared to the Take Profit relative to the Entry. This way, you can offset some losing trades with profitable ones.

However, there are also risks. Stop Loss hunting is a common phenomenon – the market fluctuates strongly, hits your Stop Loss, then reverses back. Additionally, you might enter a good position but get stopped out early, only for the price to go further afterward. These risks always exist, but setting Stop Loss and Take Profit is still very necessary, especially if you trade Futures. Without a Stop Loss, you could blow your account in an instant.

I often say, “Eat little but long-lasting.” When you start trading more professionally, Take Profit and Stop Loss are two orders you must set for every trade. They not only save time but also create efficiency and discipline in your trading approach. That’s what I want to remind you all.