My stock market trading tips about using stop loss order

I do not do any trade without using stop loss order. I learned several lessons in the past how it can be bad to trade without good stop loss policy in any stock trading strategy

So here is list of my stock market trading tips for using stop loss:

1. Do not enter your trade if you do not know your max. risk level
   Plan you trades. Every trade must have defined entry, stop loss and target levels before you will enter trade.
   
   
2. Place stop loss order immediately after you enter the trade
   I enter stop loss order immediately after I enter stock trade. I do not use mental stop. I want to be out as soon as my stop loss level is hit. Any more thinking is way to bigger losses.
   
   
3. Regularly evaluate and monitor your trade and trail stop loss level
   I monitor my open trades. I move my stop loss level into more favorable levels any time I see that trade is moving enough into right direction . I have several rules for moving stop loss.
   
   
4. If you are daytrader then use trailing stop loss order
   Day trading is very quick style of trading and therefore using of trailing stop loss order is good solution how to use computer to automatically move you stop loss level into right direction.
   
   
5. Define your stop loss strategy for special purposes like gap down or gap up open
   Open time is special case for stock markets. Sometimes stock opens with gap - it is when opening price is much different then previous closing price . And it can be much worse then your stop loss level. So it is good to have prepared special set of rules how such situation will be handled.

Any time I tried to avoid my stop loss level I prepared in advance, I was beaten. Every time I thought that price will return to previous level, I finally realized bigger loss then I planned. It is not good to use hope in your trading.

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