Stop Losses and Risk Management [FX] - Where and how?

So I have been trading the FX Markets for a while now, with my own Trading Plan where I put a 10 pip stop loss and 15 pip profit target. It works well with my entry signals and usually gives me a proper exit.
I am usually trading the 15 min charts.

Recently I have been trying a new trading system which generates more frequent and decent entry signals for me. This makes it easier for me to enter the market with more confidence.

The problem with the system is, I still desire only 15 pips profit a trade with 10 pips stop loss, which is reasonable, however the system dictates to put my stop loss over the recent swing high or the recent 5 EMA and thus providing more breathing room to the market

My dilemma is that this stop loss place does not match with my risk tolerance of 10 pips, and most recently I took a 3 % hit because of this requirement.

How can I find the balance between my trading plan and this system's requirement?
Do I need to adapt position sizing to every trade based on where the stop loss is bound to be? If I did, than don't I need to target more pips in profit to make up for the position sizing?

I would really appreciate the guidance.

Hi Mystery,

Well, without going in to too much discussion right now, it sounds as though you're experiencing a conflict between the requirements of two different "systems".

One approach you are taking speaks of placing initial stops near (what I would say are) "better" places in the market (I say this, not knowing your method), and I assume also (though you did not mention this in your post), that you would place your TP's at swing/fib/%/S&R/discretionary levels etc.. as well, and manage trades similarly while they are open.

Remember stops and profit levels are adjustable, yet you are discussing now what seem to be fixed and inflexible targets.

Anyways, you seem to be telling yourself you *must* use this 10/15 fixed criteria, while some other method you've learned or read about more recently says otherwise - can't do both! Can I presume you started trading with the 10/15 levels, and cannot "let them go". Can I suggest that you do so?

Personally (and I mean, this is just my opinion), I'd proceed with the setting of SL & TP levels, and all other trade mamagement, based on the levels that your particular pairs, their volatilities and peculiarities deem appropriate for your timeframes. Also consider MM, your risk profile etc etc, blah, blah... I'm not gonna give a trading lesson here (I'm not qualified to do so), and I reckon you know exactly what I'm talking about anyway...

In my humble opinion, 10 SL and 15 TP are WAY off for 15min trading - really. Killing yourself slowly with small losses and endless frustration on the SL, and dudding yourself substantially on the TP when you're right, or even just a bit right.. Your timing would have to be PERFECT. If it were that good, you would not be posting here, I assure you...

Sounds more like a scalping method, when at the same time you're talking also about S&R or swing trading...

How 'bout you let it all "move", and "breathe". Sounds like you're close to it. Just drop the "fixed" pip stuff. Flex with your pair, your timeframe, and the levels and behaviours they indicate at any given time. Look at other timeframes, be aware of big news events, etc etc...

Maybe look at what your stop "should" be as a first priority, then work your position sizing, TP and other trade management from there. If you really think, for instance, that you Risk/Return *must* be 2/3, then look at your required SL 1st and figure out if the necessary TP level(s) meet your needs and seem appropriate. Else, don't take the trade. I could go on, but I am digressing.

Good luck mate.

Looks like the OP found his help elsewhere... Luck to him.

I took what you said, looked for more information on it and opened a few new doors for me.

Your advice paved the way for me to seek out better information.

So thanks for that and the priceless info.