Lessons From CHF/JPY Pair

I was trading 1 minute candlesticks.

I entered a short position at 11.04 am.

Immediately the price shot up 27 pips in a steep climb until it hit the peak at 11.36 am !

I had a stop above my short position, but I had to adjust the stop at least 6 times to keep it
at a constant distance of 20 pips above the climbing peak. If I had not adjusted it, I would have exited earlier and lost 20 over pips.

LESSON: Make sure you have a very wide stop loss, preferably at least 20 pips above the highest high (if selling short) and 20 pips below the lowest low (if buying long).

So far, in all my previous trade, all of my lost trades were because of very narrow stops.

The price only came down to my sell position at 2.40 pm - i.e. 3 hrs 37 mins from my market entry point. Once a confirmed candlestick closed below my short position, I immediately adjusted my stops just below it - to lock in the profits (although it wasn't much).

I adjusted the stop loss downwards one more time to lock in more profits as another candlestick began its decline. The price immediately shot up and triggered my stop and i earned 3 pips which translates to about 3 cents.

I know it's not much, but this seems to be quite a promising formula.

LESSON: Patience - when the price goes against you, increase your Stops and wait. If you have to leave your PC, put a narrow Take Profit close to your entry point.

LESSON: Don't be greedy - once the price surpasses your entry point and you are already profitting, adjust your Stop to lock in the profit. Continue to adjust the stops little-by-little. If the candlestick hits and activates the stop - so be it. You would already have profitted!