A two pip stop sounds trivial. Yet the pain of watching a trade reach it can feel large, because losses weigh roughly twice as heavily as equivalent gains in how people experience them. Scalping multiplies the exposure: dozens of small losses a day, each one stinging.
The result is a pull toward behaviors that avoid the sting: moving stops, widening them just a little, or holding for a bounce. Each deviation seems minor, and together they transform the risk profile.
The antidote is framing at the right level. A loss on one trade is a cost of doing business, like inventory spoilage for a shop. The relevant unit is the result over a batch of trades.
Pre-committing helps. Hard stops placed at order entry remove the in-the-moment decision. Reviewing the results of stop adjustments, comparing actual outcomes with the original rule, often shows that the adjustments cost money.
It can also help to track the number of losses taken exactly as planned, as a measure of discipline, independent of profit.
How often do trades get stopped out at the planned level versus adjusted by hand?
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Loss aversion with tiny stops
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