A Trailing Stop is a type of Stop Loss that automatically moves as the market price moves in your favour.
It helps traders protect profits while limiting potential losses without needing to manually adjust the Stop Loss.
The trailing stop follows the market at a fixed distance (in points or pips):
For Buy orders, it moves up as the price rises
For Sell orders, it moves down as the price falls
If the market reverses, the Stop Loss remains at its last adjusted level.
Example
Let’s assume:
You open a Buy order on EUR/USD at 1.2550
You set a Trailing Stop of 50 pips
If the price rises to 1.2600, your Stop Loss will automatically move:
From 1.2500 to 1.2550
The Trailing Stop will remain at 1.2550 unless the market moves another 50 pips in your favour, in which case it will adjust again.
If the market reverses and reaches the Stop Loss level, the position will close automatically.
Important Notes
Trailing Stops only move when the market moves in your favour
Trailing Stops do not move backwards
If your platform is closed, the Trailing Stop will not update
Trailing Stops are not supported on MT4 mobile apps (Android & iOS)