A trailing stop order sets the stop level at a fixed amount of pips below or above the entry price with a set "trailing" amount. As your trading position moves into profit, the trailing stop moves accordingly to the set mumber of pips, to secure your profits. If the price doesn't change, the trailing stop does not change as well. When the trailing stop is hit the position will be closed.

Part of our multimedia library, learn in this video what is a trailing stop loss in Forex, how it works and how to use it in your trading strategy.

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If you would like to know more about the different order types available in Forex trading and how to use them, please read our complete article Understanding Forex Order Types: Buy Limit, Buy Stop, Sell Limit, Sell Stop, & Market Order.