Break-Even Stop

A break-even stop is a stop-loss manually or automatically moved to the trade's original entry price once the trade has moved sufficiently into profit, ensuring the position can no longer turn into a net loss (aside from spread/commission). It's a common way to remove downside risk from a trade without closing it and giving up further upside. Moving a stop to break-even too early — before the trade has enough room to breathe — is a common mistake that gets a trader stopped out on ordinary volatility, only to watch the original move continue without them.