Comments on the losing trade on 26.04.2012

In the night from Thursday to Friday, after the closing of the U.S. trading platforms, the rating agency Standards and Poor`s published news on the rating downgrade of Spain to BBB +, which caused an immediate reaction from the market, and as a consequence, the EUR/USD pair fell by 80 pips. This sudden movement during the Megadroid trading session triggered the opening of two tradings, one of which was closed by a stop loss of 60 pips. The stop loss was set at the minimal size due to the small amplitude of the previous day.

In order to avoid similar situations, in the updated version of the Megadroid EA, there will be implemented a tracking system for sharp price movements. Once the system goes on, stop losses of the opened orders will be growing by 15-20%, in order to wait out the market’s reaction to the distractors. This system has already been developed and is in the testing phase. In addition, our analysts team will focus on the publication of the credit ratings.

    1 Comment

  1. James
    2012/04/30 at 22:56

    Thanks for posting this. There’s a war brewing over the blogosphere about this latest loss. However I like that you have already started work on addressing this condition.

    You strat to increase S/L seems sound since the market recovered only a few pips beyond s/l and eventually reached B/E.

    Keep up the work guys and thanks!

    Reply

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