Free Exit Guide
When To Exit A Trade: Where To Put Your Stop And When To Close
A practical stop and exit method for ProvenSignals alerts on XAUUSD, ES, NQ, EURUSD and BTC.
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When to Exit a Trade (And Where to Put Your Stop Loss)
Every quick trade ends in one of two ways. Price reaches your stop, or you close the trade. Most traders plan the first exit and then invent the second one while the trade is open. That is how good trades turn into bad ones.
This guide answers two questions: when to exit a trade, and where to put your stop loss. The method is built for the quick trades that come from ProvenSignals alerts, and it works the same on XAUUSD, ES, NQ, EURUSD and BTC. If you are new to the alert format, start with how to read trading signals.
You will see where the stop goes on a buy and on a sell, how the 3-5 candle exit works, a ten second check that tells you when to skip a trade, and how to size all five markets from one stop with the free position size calculator.
The Two Exits Every Quick Trade Has
The first exit is the stop. It is the price where your trade idea is wrong. The second exit is the move. It is the point where you close a trade that has worked. A complete plan has both, and both are decided before you enter.
A ProvenSignals alert gives you the market, the direction and the chart timeframe, for example XAU/USD Buy Signal, Chart 1-minute. It does not give an entry, a stop or targets. You open the same chart, place the stop yourself, and close after about a 3-5 candle move in the direction of the trade. The full routine is in the guide on how to read trading signals.
- The stop: the level where the trade idea is wrong.
- The exit: about 3-5 candles in your direction on the alert's timeframe.
- The size: set from the stop distance, never the other way round.
Where To Put Your Stop Loss
Stop loss placement starts with the chart, not the account. Look for a level the market has already respected, then put the stop on the far side of it. If price trades through that level, the reason for the trade is gone.
Stop Loss On A Buy: Below Recent Support
For a buy, find recent support. That is the low of the last few candles, or a clear swing low on the alert's timeframe. Place the stop below it, with a small gap beyond the level so that a brief touch does not close the trade. Then measure the distance from your entry to the stop. That distance is the number you size from.
Example on gold: you buy XAUUSD at 2400.00 on the 1-minute chart and recent support sits at 2398.00. A stop at 2397.50 puts the stop distance at $2.50.
Stop Loss On A Sell: Above Recent Resistance
For a sell, find recent resistance. That is the high of the last few candles, or a clear swing high. Place the stop above it with the same small gap, and measure the distance from entry to stop.
Example on NQ: you sell NQ at 21000.00 on the 1-minute chart and recent resistance sits at 21015.00. A stop at 21020.00 puts the stop distance at 20 points.
| Direction | Where the stop goes | Why |
|---|---|---|
| Buy | Below recent support | Price trading through support means the idea is wrong. |
| Sell | Above recent resistance | Price trading through resistance means the idea is wrong. |
This placement rule is the same on ES, EURUSD and BTC. The chart picks the stop. The account picks the size. If the stop feels too wide, the answer is a smaller position, not a closer stop. Sizing from the stop is covered below, and the position size calculator does the math for you.
The 3-5 Candle Exit
Now the exit when the trade works. ProvenSignals trades are quick, so the exit is a count. After your entry, count the candles on the chart named in the alert: one, two, three, four, five. When price has moved in your direction for 3-5 candles, you are in the exit zone. Close the trade.
On a 1-minute chart each candle is one minute, so the exit zone is about 3-5 minutes after entry. On a 5-minute chart the same count is about 15-25 minutes. The clock follows the chart in the alert.
| Alert timeframe | One candle | 3-5 candle exit zone |
|---|---|---|
| 1-minute | 1 minute | About 3-5 minutes |
| 5-minute | 5 minutes | About 15-25 minutes |
The same count applies on XAUUSD, ES, NQ, EURUSD and BTC. What changes from market to market is how far price travels in those candles. That is why the stop and the size come from the chart and not from a fixed number.
The One More Candle Mistake
Here is the mistake that ruins a good exit. Price has moved four candles your way. You are in profit, the exit zone is here, and a thought arrives: one more.
Now you are no longer following the plan you made. You are making a new plan with a live position, in the middle of the move. Sometimes the extra candle is fine, and that is why it is tempting. It teaches you to break the rule that makes a quick trade repeatable. A trade that ends on plan is a good trade, whatever the next candle does.
- Decide the exit before the entry.
- Write down the candle count.
- Close when you reach the count.
Never Widen Your Stop
The same discipline applies to the stop. If price goes the other way, the stop closes the trade. Never move the stop further away from price. That turns a planned loss into a larger one.
The 10 Second Check Before You Enter
Before you take a signal, run a check that takes ten seconds. It tells you when to skip a trade before you enter it.
- Look at the last 20 candles on the alert's timeframe.
- Estimate how far a typical candle moves.
- Multiply that by 3-5. This is roughly how far a normal exit move travels.
- Compare it with the stop distance you need.
If the stop you need is far bigger than a normal 3-5 candle move, you are using a large stop to chase a small move on a quick trade. Skip it, or wait for a cleaner level. The check keeps the stop honest and the exit realistic.
| Market | Typical candle | Normal exit move | Example stop |
|---|---|---|---|
| XAUUSD | About $1.00 | $3 to $5 | $2.50 fits |
| EURUSD | About 2 pips | 6 to 10 pips | 8 pips fits |
| ES | About 1.25 points | About 4 to 6 points | 4 points fits |
| NQ | About 5 points | 15 to 25 points | 20 points fits |
| BTC | About $80 | $240 to $400 | $250 fits |
On the gold example, a stop of $2.50 sits inside the normal $3 to $5 move. A stop of $15 does not. It is several times larger than a normal exit move, so skip the trade or wait for a cleaner level.
How To Calculate Stop Loss And Position Size
Once the chart sets the stop, the position size has to flex. Pick the amount you are willing to lose, divide it by the loss per lot or contract at your stop, and round down.
The examples below use a $10,000 account risking 1%, so the risk amount is $100. All five use the stop distances from the placement examples above.
XAUUSD Stop Loss And Lot Size
One lot of gold is 100 ounces, so a $1 move is $100 per lot. A $2.50 stop is $250 per lot. $100 ÷ $250 = 0.40 lots.
EURUSD Stop Loss And Lot Size
Sell EURUSD at 1.0850 with a stop at 1.0858, which is 8 pips. A pip is $10 per standard lot, so the stop is $80 per lot. $100 ÷ $80 = 1.25 lots.
ES Stop Loss And Micro Contracts
ES is $50 per point, so a 4 point stop is $200 per contract. That is above the $100 risk amount. MES is $5 per point, so the stop is $20 per micro contract. $100 ÷ $20 = 5 MES.
NQ Stop Loss And Micro Contracts
NQ is $20 per point, so a 20 point stop is $400 per contract. MNQ is $2 per point, so the stop is $40 per micro contract. $100 ÷ $40 = 2.5, which rounds down to 2 MNQ. The loss at the stop is $80.
BTC Stop Loss And Position Size
Bitcoin is sized in coins. With a $250 stop, $100 ÷ $250 = 0.4 BTC.
| Market | Stop | Loss per lot or contract | Position size |
|---|---|---|---|
| XAUUSD | $2.50 | $250 per lot | 0.40 lots |
| EURUSD | 8 pips | $80 per lot | 1.25 lots |
| ES | 4 points | $20 per MES | 5 MES |
| NQ | 20 points | $40 per MNQ | 2 MNQ |
| BTC | $250 | $250 per coin | 0.4 BTC |
Only the stop and the value per point change. The method does not. Use the free position size calculator to run the math and round down for you, and the pip and point value calculator to see what a move is worth on each market.
Match The Exit To The Session
The session changes how fast these trades move. The same five candles cover more price when the market is busy and less when it is quiet. Gold and the index futures tend to be most active when London and New York overlap.
The free market sessions clock shows every session in your own time zone, so you know whether you are trading a busy part of the day or a slow one. Check it before you size, because a quiet session changes what a 3-5 candle move is worth.
Take Or Skip Checklist
Keep this next to your charts.
Take the trade when
- The stop sits at a real level: below support for a buy, above resistance for a sell.
- The exit count is decided before entry.
- The stop fits a normal 3-5 candle move.
- The size fits your account percent.
- You checked the session.
Skip the trade when
- There is no logical level for the stop.
- The stop is far bigger than a normal 3-5 candle move.
- The size needed breaks your account percent rule.
- You are looking at a different timeframe than the alert named.
Frequently Asked Questions
Decide the exit before you enter. For a quick trade, close after about a 3-5 candle move in your direction on the chart named in the alert, or when price reaches your stop, whichever comes first.
On a buy, put the stop below recent support, with a small gap beyond the level. On a sell, put it above recent resistance. The stop belongs where the trade idea is wrong, so price trading through that level means the idea has failed.
About 3-5 candles in the direction of the trade on the alert's timeframe. On a 1-minute chart that is roughly 3-5 minutes, and on a 5-minute chart it is roughly 15-25 minutes.
No. Never widen the stop. Moving it away from price turns a planned loss into a larger one. If the stop feels too wide at the start, reduce the position size instead, because the chart sets the stop and the account sets the size.
Place the stop at a real level, then measure the distance from entry to stop. Divide your risk amount by the loss per lot or contract at that distance and round down. With $100 at risk and a $2.50 gold stop, the size is 0.40 lots. The position size calculator does this for every market.
The count is the same on XAUUSD, ES, NQ, EURUSD and BTC, and the clock follows the timeframe in the alert. How far price travels in those candles differs by market and session, so run the ten second check on your own chart before you enter.
More Free Tools
Position Size Calculator
Turn your stop into lots, contracts or coins for gold, ES, NQ, EURUSD and BTC.
Pip & Point Value Calculator
See what one pip, point or tick is worth in dollars at your size.
Market Sessions Clock
Live Sydney, Tokyo, London and New York hours in your own time zone.
Get The Signals
Keep the checklist next to your charts. Join the free Telegram channel for signals on XAUUSD, ES, NQ, EURUSD and BTC, then size every trade from the stop with the position size calculator and check the market sessions clock before you enter.