How to get out of USD/JPY losing trade

I am too embarrassed to ask but I will anyway because of my fear of losing over US$3,000.

I bought USD/JPY pair at 119.9370, which proved to be the worst entry. The trade went south on me quite rapidly. Too fast for me to do anything. Being an inexpeerienced trader, I did not put a stop. I have been holding this position for over two weeks now. It ha snow worsen because the non-farm payroll figures last Friday. What should I do?

Desperately seeking advice.

You’ll probably want to hear from one of the more experienced traders on this forum. But lets first examine what we can probably expect from the USD/JPY in the coming sessions. Below is what was posted today in the Analyst Arena on this site…

[I]Dollar/yen consolidated sank to close on Friday at its lowest level in four months. This is the fourth consecutive week of losses and the selling pressure should continue this week as well.

Initial support is 117.60. Next level is 116.85 from a 50-point pivot that targets 116.35 and 117.35.

Immediate resistance is at 118.25 from a 50-point pivot that targets 117.75 and 118.75. Above 119.20, resistance is seen at 119.65 from a 50-point pivot that targets 119.15 and 120.15.
Oscillators are falling.

LONG-TERM: Bullish[/I]

And from my analysis of the Daily chart, I can find nothing to dispute this. Because the Stochastics are quickly approaching over sold conditions, I would expect the pair to fall some more, then slightly rebound, before continuing its course south.

You mentioned you entered around $119.93. Barring an asteroid striking Japan and sinking the entire country, I don’t see any technical indication this currency pair will be back up around $119.93 anytime in the near future.

Best course of action IMHO, is to take your loss now. Get out now, and save what remains of your account. Learn from this mistake. If your new to trading, I would seriously recommend NOT TRADING with real money for a while. Open a demo account, and learn a system. There are some nice, simple systems you can learn on this site. And then successfully apply the system, to your demo account for at least 3 months. The goal here is to grow your demo account first, prove you can do that.

Then, once your confident again, and have a working system, go back and trade with your live account. Thats the best advice I can give.

Good Luck!!!

dont close ur trade now it is late to close it, u r in a big losss, the only way when the indicators reach the oversold level, just try to buy arround 117 level, in that case u will be having an average 118.50, and soon the yen will rebound dont worry they r talking about raising the yen interest:confused:

"dont close ur trade now"
I’m totally new to this, but isn’t it difficult to advise Sleolaya not to take his loss without knowing how much margin he has? how much more loss he can withstand without getting a margin call? If he risks getting wiped out if there’s another week or two of the dollar going south then shouldn’t he close his trade ASAP?

first tell me quickly what is your account size
I just did a quick technical analysis and it looks USD/JPY will move up, its in correcting phase.
And 117.95 - 118.05 is the support as far as i see at the moment.
And this is the resistance level of 3rd March 2006.

What should you do?

We cannot repair your entry so…

Face the fact that you will make a loss. Rule : set your stop losses. The first loss is always the least.
Go thro the Babypips school if you have not already done so. If you have restudy the sections on money management and have a plan before you attack the market.

Regards, Tymen Wortel, Perth, Western Australia.

Cutting your losses is all well and good, but you must also give your trades time.

The carry trade isn’t going anywhere anytime soon; I think this dip is a bit of profit taking/temporary risk aversion and shaking out the weak longs for a better buy in price. Thankfully you’re interest positive, which will help reduce your losses and payoff in the long run.

No one has a crystal ball; at least not one that works. However, if I was in your position I would hold onto the trade. You can consider scaling out, and then scaling back in when it starts to clearly go your way again. Based on that entry price you’ve told us, and your posting time, your loss should be significantly less by now anyways.

Word of caution though for tomorrow’s FOMC rate decision. I really doubt the fed is going to change their stance, but if they do make any significant changes I would close your position immediately.

Regardless of what happens, write a journal entry regarding what happened and all of your mistakes. Make sure you don’t get into any trades without having a planned exit from now on. It also sounds like you’re trading too large for your account/experience.

I hope you are doing fine in this trade of yours?

Thanks for the thought. I know I should be doing fine just right now. However, my broker automatically liquidated my posiiton two days ago. My lost is staggering (at least for me). How do you keep yourself motivated to continue doing this?


The one thing you need to ask yourself is are you in a position to live your life as it is if you loose the entire account? If you can then don’t worry if you can’t then I don’t think you should be trading in a live account.

You got margin called and that’s not very nice but you need to learn from your loss… I would take a break for a bit (not too long) and go back to the demo accounts and work out some bugs in your system. Don’t be to eager to regain the loss as this will lead to over trading and loosing even more. Just adjust your system to the new account balance. over time you will build it up again…

Another option is to increace the leverage amount if you can… if you were at 200:1 go to 400:1. Pips are only .08-.10c per pip but they add up.

check out the thread “Micrapip’s back” this demo account is at 400:1

Keep your chin up and learn learn learn


Micrapip how would increasing his leverage help? This would not change the pip value unless he purchased a larger lot size and that would only increase his risk?

It’s pretty simple…

at 100:1 one standard lot ($100,000) nets ~$10/pip costs $1,000
at 400:1 one standard lot ($1,000) nets ~.10/pip costs $10

The cost to get into a position drops… and the net loss if incurred is less… so less risk…

It will take you longer to reach massive gains (losses) but sleolaya would be able to stay in the game and demo the system without risking the big denaro


Ok. So on a 400:1 leverage account the standard lot is only 1000? I was assuming you were buying 100,000 on it as well. I have never had a demo with that kind of leverage.

For a micro lot (1000) on 400:1 leverage which would net you .10 a pip, would this not only cost you $2.5 of used margin instead of $10 to get in the trade?

Micrapip, I think you’re a bit confused about leverage.

Account leverage has nothing to do with your lot size, only the amount of margin required for your lot size.

100:1 leverage = $1,000 in margin per 100k lot
400:1 leverage = $250 in margin per 100k lot

What you’re trying to convey to him is correct though.

Sleolaya does not need higher leverage, he needs smaller position sizes. Such as a micro lot (1k) or a mini lot (10k), whatever is suitable for his account size and strategy.

Ya I see your point… In my brokers software you can select the amount of margin (50:1,100:1,200:1 or 400:1) on the same screen you select your default lot size (1000,10000,100000 etc)

I have mine set to 400:1 and lot size of 1000 therefore when I go to the pip calculator for a 1000 = .08 - .10/pip.

And Will… my bad… it is $2.50 per lot as per the parameters above.


I’m fairly new to this too (been trading for about 2 months now). Got margin called about a week ago on a USD/JPY ‘mistake’ similar to yours. I felt tears come to my eyes and became very demotivated, especially since the market turned back upwards just a couple of days after. I eventually picked myself up off the floor and reminded myself of all the reading I came across that said that many of the best traders out there totally blew their first account.

Three things/lessons have come out of this for me:

  1. Use stop losses…and stick to them. Its one thing to set a stop loss, but its another thing to resist the urge to keep moving the SL in the hopes that the market will turn around.

  2. (Learnt this one too late) If I’m already up to my knees in a crappy position, but all indicators show that the market in about to reverse in a favorable direction pretty soon, one way to buy time is to increase the leverage to maximum in order to avoid a margin call. (Please don’t attack me, I know this is risky…yes…but it would have helped me the other day had I known this).

  3. I now keep a journal where I write down all the mistakes I make on ‘bad’ trades and record what I learnt from it.

So dust yourself off…probably go back to demo until you’ve developed a system you’re confident in…and get back in the game!

OK here is what you do and in this order.

  1. Do not tell anybody (except us) what you just did. They will only call you a fool and say “I told you so!” Stay away from negitave people.

  2. Close your account take what ever money is left and go get drunk!

  3. Take a month off, don’t look at the market. THEN open a demo and trade until you have 3 months of profit in a row.

  4. Dont look at that pair for about a year.

  5. read my post

  6. Learn from your mistakes but don’t let it haunt you.

You had me at getting drunk. :smiley:

Thank you all for the good advice. After getting drunk, I am now on my way to the casino. I live in Vegas, I thought I have a better chance with my money in forex trading. Seems like I am better off at the casino. At least I can get some free beers and gawk at pretty girls. :slight_smile: :smiley: Instead of staring into my computer for hours on end.

Ah … there’s life after forex!!

I will not give up though. I will keep the account but not trade on it for a while. I have requested my broker to re-open a demo account for me. I still have a mini account where I can trade small amounts for smaller risk/gain.