When to close positions in Forex.

There are many methods for closing Forex positions, but typically, this action is based on two factors: achieving the required profit level and exceeding the loss threshold.

Consequently, Forex positions are closed either by triggering stop orders (take profit, stop loss, trailing stop), or manually at the trader's discretion.

How to close losing positions has been discussed many times, so we'll only briefly touch on this point, clarifying the main points.

Closing losing positions.

Forex risk management perspective , is that the loss from a single unsuccessful trade should not exceed 2-3%, but this option is suitable for fairly large deposits and when using low leverage.

After all, if you have only $1,000 in your account and use 1:100 leverage, even when trading a 0.5 lot volume, you'll have to close the position if the price moves against you by just 4-6 pips. This isn't much more than the minimum spread.

For this reason, I try to slightly increase my acceptable loss, within 5-8%, trade with a larger deposit, and open smaller trades. At the same time, I also remember to take the trend into account.

Closing profitable positions.

Here, things are much more complicated, as your hands are simply drawn to close the order and take the couple of pips you already have. But the main thing is to resist the first impulse and act not on emotions, but on the basis of analytical data.

So, about the options for closing profitable positions on Forex:

1. We proceed from the opposite approach: the order is closed as soon as a signal is received to open a position in the opposite direction. The source of such a signal could be a Forex indicator, a message from a signal provider, or your own conclusion about the market dynamics.

2. A sharp movement: as soon as you notice the market has become more active, try to close the profitable trade. True, you can risk taking a couple more pips if the price is moving in the desired direction, but as soon as it starts to reverse, do not close the trade immediately; better yet, set a safety stop in advance.

3. By time: if before trading, you determine that the average price fluctuation on your time frame lasts about an hour, followed by a correction, this will be the basis for exiting the market. You can also target the end of the working day or week, but exit approximately two hours before the specific moment.

4. Based on market volatility and movement amplitude – this option is usually used when trading in price channels. As soon as the price approaches the reversal point, the position is closed.

Eliminating emotions and trading solely based on the data obtained will immediately increase the profitability of your trades, and with it, your overall financial result.