{quote} thanks Zondervan, appreciate the immediate response...So, do you analyse this daily and place trades on a daily basis or you change the bias of a currency only once in a week? Also, once your TP is hit and all trades are closed, then you will look for another opportunity immediately or you wait for a daily close? And what made you to choose the TP as 340 and SL as 180? any reason or some random number? And as you mentioned, the lot size for each pair should be unique based on that particular pair's qualities as each pair is different...
In an hour or so I will place my next basket trade (sell JPY)
There will be 3 outcomes to this basket trade:
1) Basket SL hit lose $180 (this tends to happen within a few hours of opening the trade basket)
2) Basket TP hit win $340 (this can take between 6 and 23 hours)
3) neither hit- so I will take what the market gives me (either profit or loss) before the daily close 17:00 EST
I am completely happy with any of these outcomes as I know I won't win every trade (historically 3 out of 10 will lose).
The amounts $180 and $340 are again set by averages.
If my basket trade is successful it normally doesn't have a draw down greater than $180. So that is where I set the basket SL. Basically I want to close out a loser as soon as possible but give it a bit of room to move if it becomes a winner.
The $340 is a slightly above average winner. There have been opportunities to make over $500 per trade basket, but these are rare. So I have picked $340 for now.
Perhaps in the future I will play around with these numbers a bit more to optimise profit and risk to reward. (It is amazing what moving a SL or TP by just 10% can do to your bottom line). Also yes I might play around with the lot sizes in the future. But my next step if February is successful, is testing with a small live account, which will only allow me to trade the same small lot size 0.01. So for now I will just keep the lot size the same.
