In the previous post (Forex Investing- Shorting the GBP/JPY) I showed you why I wanted to short the GBP/JPY.  The order was filled at the entry point of 141.10 where I took a 2% position.  The pair rallied up to 141.71 but then reversed down missing our stop at 142.05.

I took half the position off when the pair made it down to 136.10 as the position was up 500 pips on the trade and there is never anything wrong with taking a profit.  It is also right at the trend line support of the 0.5% point and figure chart below.  The pair continued down to 135.55 before reversing back up.

Because the initial position was 2% capital risk with a stop loss only 95 pips away when I sold half the position at a 500 pip gain the trade put the account up over 5% on the trade.  At this point I moved the stop loss down to 141.05 just below our initial entry point.  On the 0.5% chart this would be a double top break, it would also assure that the trade would not loose any money.

As you can see on the chart below the trade was stopped out as the pair went up to 141.50 hitting the stop loss at 141.05.  Should I have kept the stop loss at 142.05?  Maybe.  It is tough to say really and that is why this is more of an art form than it is a science.

At the end of the day the trade was profitable and increased the account by 5% so all things considered it was a great trade.