As it was just mentioned before, it would be better to avoid trading during the days with the elevated volatility. Most of the traders close their positions at Friday noon to avoid exposing to risks of unexpected news and other events occured at the weekend. At the same time, Monday as the first day of the week is extremely volatile too because of the traders` reaction on all news and events took place during weekends. That is why it would be better to trade full lot size just from Tuesday to Thursday.
By the way, what are the main entering and closing signals for your strategy? Is it based only on MAs and RSI? Once I saw an example of such strategy, but have not tried to use it. Maybe, you should pay additional attention to the risk management rules. Appropriate risk management could help you to avoid large losses even in case of high volatility.
If we speak about such huge losses, the problem could be not even in risk management, but in money management in general as the menthod you use to define risk per trader and per day.
So, the checklist is the following:
- strategy itself (entry/exit rules)
- risk management (where to place stop)
- money management (risk per trade/day).