What is Trailing Stop?

Updated October 17, 2026

A trailing stop is a stop loss that follows price as the trade moves in your favor.

A trailing stop moves up with your winning trade but never moves back down. It locks in profit as price runs.

If price turns around, the stop catches it and closes the trade.

It's great in trends. In choppy markets it can close you out too early.

Example

You set a 20 pip trailing stop. Price runs 60 pips up, so your stop is now 40 pips in profit.

Does a trailing stop work when my platform is closed?

On MetaTrader it only runs while the terminal is open, so many people use a VPS.

Is a trailing stop better than take profit?

Neither is better. It depends on whether the market is trending or ranging.

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