This YouTube video (Kardec Trader, Dec 31, 2025) teaches a risk-management strategy for traders using 'action lines' and 'safety lines'. The speaker explains how to set stop losses when price fails to respect these lines, stresses that placement is subjective, and recommends conservative stop settings for beginners based on risk tolerance, position size, and experience.
So I'm thinking Price is going to respect and boom, obviously it doesn't. This is what's the coolest part about these action lines and safety lines. Even when something scary like that happens, which a lot of traders will freeze up, they don't know what to do. Maybe they'll set their stop at, you know, the last low. This is my safety and my actions. So if Price didn't respect it, I'm going to know immediately. This part is subjective. Am I putting it this close? Am I allowing that much room? This part is going to be based on the trader. If you're brand new, you could put it just below break even. So these are all stop losses for the beginner traders. I'd say something in this range, but these are going to be based on risk tolerance, position, size and experience.
