This trade looked very promising on paper, but in reality, it didn’t turn out as planned. The issue was that I set my stop loss (SL) at break even or slightly above. As a result, it was triggered, and the trade closed at the next available market price. Typically, this matches my SL price exactly, but this time, it didn’t, leaving me with a 5% loss on the trade.
What could I have done differently? First, I’m not very familiar with this asset pair. It’s possible that it exhibits more volatile movements, which I should account for when trading. Second, I could have left the trade as it was and avoided moving my SL to break even. However, I was very tempted to adjust it because my trade’s risk/reward ratio (1.58) wasn’t ideal. Determining an optimal ratio remains a challenge for me.
Additionally, I might reconsider trading on eToro. There could be platforms that offer better tools for managing risk. That said, I’ve been generally pleased with eToro. Over the past two years, I haven’t experienced any issues. Even with this trade, I reached out to customer service, and they responded quickly and transparently, explaining what went wrong.
In conclusion, I think I’ll focus on improving my risk/reward ratio to at least 1.8, and ideally 2, to better manage future trades.
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