A A time-based stop loss is a stop loss that is initiated ... More is a that is initiated after a pre-determined amount of time has elapsed. It can be automated or manual and in both cases, your is closed to allow you to seek a better or opportunities for your .
Time-based A stop loss is an order that automatically closes your tra... More are also sometimes referred to as “time stops”.
How are time-based stop losses used?
Time-based stop losses are often used if the market does not seem to be moving in either direction, meaning that neither your stop loss norhas been hit for a certain period of time.
Rather than leaving yourtied up in a trade where there isn’t much movement, you can use a time-based stop loss to exit after a certain amount of time has elapsed, leaving you free to use that capital for other opportunities.
Remember: It is important to note thatrules still apply with time-based stop losses and they should always be used in conjunction with a pre-determined stop loss and profit target.
Also, if you prefer not to leave your trades open overnight or over the weekend, you could set a time-based stop loss to close your positions and avoid the risks associated with.
To learn more about the different types of stop losses, read our lesson: