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This question is kinda like how do I tie a knot, there are tons of different ways to fish eels depending on your situation and a lot of it is personal preference.
Are you fishing from a boat or from shore?
Shore - I like live eels, I fish them so slow you would think I wasn't even reeling. 20 inch leader to a 7/0 J hook through the head and drag it over a boulder field. The info up top is right, you will lose fish to premature sets so drop the tip and let her take it before setting the hook. If your using a conventional as soon as you feel the tap dis engage and let her run, then set up on her.
Boat - Use a 3 way swivel at the end of your braid, then 24 inch leader to a weight (depends on depth and current) and off the other side a 12 inch leader to the circle hook. Drag this SOB real slow over structure and get ready. You can also cast and retrieve eels over structure, just remember SLOW is the way to go.
Google fishing with eels and more info than you'll read in a day will come up on this topic.
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