What is a Stop loss / Take profit?

A Stop-Loss (SL) is a commonly used risk management tool that limits potential losses in trading. If the market moves against your position, the SL automatically closes the trade at the predefined level, preventing further loss. 

A Take-Profit (TP) does the opposite: it closes your position at a predefined level to secure your floating profits before the market reverses. 

You can set SL and TP levels either as specific prices or as a number of pips from the entry price, depending on the platform settings. In Forex trading, these tools are essential for managing risk effectively. 

For more details, check out our article.