Not long after I placed my buy order on Friday morning, AUD/USD came up and hit it.  The pair flirted with my profit target, but never hit it before the market closed for the week.  So I'm long AUD/USD to start the new week.

With this trade I've modified my position sizing strategy.  My previous position sizing strategy was as follows:  First determine where I want to place my stop (based on support, resistance, a prior high or low, etc...).  The distance from my entry to my initial stop loss is my initial risk (R).  Then set three orders where I want to enter the trade.  The size of my orders is based on the initial risk.  If I want to risk no more than 1.5% of my account on a given trade, my three positions are sized such that the distance from my entry to my initial stop is about 0.5% of my total account balance (3 positions * 0.5% = 1.5% risked).  When I enter my first order, I use a profit target of 1/2 R (meaning that my profit target is half the distance from my entry to my stop loss but the other direction).  When I enter my second order, I use a profit target of 1 R (meaning that my profit target is the same distance as that from my entry to my stop loss but in the other direction).  When I enter my third order, I don't set a profit target - this is the part of my position that will catch the big move if the trade takes off in my favor past my first to profit targets.  Once in the trade and my first profit target is hit, I move my stop to just above break-even.

The new strategy that I'm testing out is as follows:  do the same as above, except combine the first two thirds of my position into one with a profit target of 1/2 R.  So, as soon as the rate moves one half the distance from my entry to my initial stop loss in the other direction, I bank the profit on two thirds of my position, and let the remaining third run.

"So why am I changing my position strategy?" you may ask.  The reason is that I've seen an unusually large number of my trades hit my first profit target and then head back toward my entry, allowing me to profit on only a third of my position.  I'll stick with the new strategy for a while and see how it works out.  I'll keep you posted...