In the last two weeks I have taken several long trades on EURJPY. Over the last two weeks the pair rallied 700 pips (!!) from 133 to 140, after hitting a high of 141.
Overall I lost 0.22R. But have a look at the charts below. on the first three I was right, but tightened my stop too quickly. In each case my initial stop would have allowed me to stay in the trade and hit the target. Thus instead of losing 1R across the first three trades I would have gained 3-4R at least. For the 4th trade everything went ok. I managed to squeeze out some juice at the end of the day.
The 5th trade was a case of staying in the trade when price retraced to the EMA (I was not going to repeat the same thing that I had done for the first three trades, even though it had actually entered my mind to do so). Then of course comes the question of whether I could have stayed in the trade for longer. I think this should depend on what time of the day the trade is on. If entry is around the start of the London session then price could go quite far. However this is not the case if entering halfway through the New York session. So maybe in the form use a trailing stop and/or partial exiting and maybe for the latter use an all-in/all-out approach at a justifiable level.
The 6th trade didn’t work out – sh*T happens.
The first USDJPY trade from Thursday provides yet another example! My overaggressive tightening stopped me out of long position before the rally.