Help needed....I hedged using buy and sell in same pair USDJPY...any strategy to exit

Hi All,

I am new to the forum and forex trading. I trade on MT4. I opened a Sell position in USDJPY (at price 108.76) but market went against me and I hedged it with a Buy in same pair (at price 112.660). The gap between the two trades (floating loss) is over $3000. I have $1000 equity left. I have learned my lesson from the mistake of hedging and not using stop loss. USDJPY is still going higher. Can some experts please suggest a way out. at what price and how can i exit. I have a couple of thousand dollars available in reserve that I can deposit to increase the equity. Thanks

Have you checked the fundamentals?
BOJ will extend the QE beyond 2017.
FED will wait and talk options.
Your short is a mistake.
The price will move way upper.
I would take out the short, but not the full position at once.

Sorry about your situation.

You should read this:

http://forums.babypips.com/beginner-questions/85841-currency-carry-hedging.html

Can I have a look at your screen shoot? 10m and 1H chart.

Hedging can b done n v profitable if u do the to the way, but most importantly u must know what kind of strategy and layout n ofcourse must know price action well in order to do hedging… This tread may b able to help u. 301 Moved Permanently

Hot tip for the day:

Cut your losses and start again. You’ll need an awful dose of luck to bring back the gap of 390 pips.

I saw the 1h chart now. Usd is v high right now… 390 pips is really alot… If don’t cut losses, it can be done too. But hv to b real slowly to earn back the pips. But if he don’t hv confident as what u say. Heart pain… Cut losses start over again… Is the best choice for him… For my hedging most is 15pips different. And must win back once price pull back… But I don’t understand there a few pull back n he didn’t win back the pips??? Maybe I’m a scilper not long term trader. So trading habits is different.

Another way is trade breakout… This is what I do yesterday night.



Close the short immediately. Put a stop-loss in on the long.

If TA shows this pair is going up, add to the long at a suitable entry point as long as you can see a suitable place for a new stop in the TA. If better opportunities present elsewhere take them instead; remember, money lost to USD/JPY does not have to be regained from USD/JPY.

Yes true, money lost to usd/jpy does not hv to be regained from same pair. Well said to more, good point

i partially agree to what others said. partially not.

hedging is used to secure gained profits in a period where the market is acting against you. you did tje opposite. you secured a loss while the market was acting against you. thats one big mistake that you-im sure- will never do again.

the solution to your problem is a very easy one- and reverse common logic aswell.

for now keep both trades open. you are not winning and not more and not losing more. you froze your trade.

at some point you must find a good exit point for your profitable trade and keep the losing trade open. (not close the losing one and add to the winning one)

once you see the pair is turning again you close your winning position and hold the losing position open. when the market has moved down enough you can close your loser at a better rate and lose less- or if lucky- close at 0 or even profit at some point (depending on luck and your patience).

this will take time but you can leave this trade at a lower loss if you show patience and do not panic.

where you see the peak of the upmovement (better after confirmed peak and downmovement started) you close your winning long position and let the losing short get as close as possible to 0.

This is relying on his ability to pick a top. Given he waited 390 pips before entering a hedge, I’d suggest he’s not capable just yet.

Close them both, start again.

thats the point. it isnt. he can close his profiting long after the top and still close it in profit. closing both now is one option but then by tomorrow he will be opening a new trade with a salty psychology and the feeling he must make up for his big loss- and most likely continue losing. patience is key in trading. cutting loses short should have been done long ago in his first trade, now he is in a messy situation and can get out if he practices patience.

Just don revenge trading… Do it slowly… As a new trader I feel 390 pips is super alot and… Plus u trade alot of lots… I think shouldn’t do it tat way. I don’t know what kind of trading strategy u using. But anyway… Always test water water…Don’t jump into it too fast… The advice u need all trader have already given u in here. So buddy don’t rush, don’t panic, trade wisely.
May God be with us.

Nero, what you suggested makes. However one more thing should be considered if he chooses to close just the wining trade he might get stopped out eventually if he doesn’t use the reserve to increase the equity. I didn’t see a lot size mentioned in the thread so far, but if 390 pips generated over 3000$ loss it should be around 1 lot, I believe. Indeed “patience is key in trading” but considering how messy the situation is + the pair maybe going up until 115.00 before turning, a huge amount of patience will be needed. IMO hedging such huge minus and compensating it after that is barely possible, so maybe a start over (after a week or two of cool down period) would be a better option.

I agree, size matters :slight_smile: