There's no pain quite like it...

Well, after watching this trade get up over 180 pips, I had to watch it go back and take out the stop at breakeven. I did keep one pip for my trouble... not that it matters a whole lot. I didn't even get the consolation prize of positive carry, so in reality, this significant winner turned into a very small loss.
Why would anyone do this to themselves? Trades like this are what make trading so maddeningly hard. It is why 95% of retail forex traders lose all their money. It's placing too much significance on one trade in a series of hundreds that causes the trader to take the actions that lead to big losses instead of big gains.
What could I have done to make sure this trade landed in the 'WIN' column?
1) I could have trailed the stop closer. That would work, but it means that over time I'd be limiting myself to small winners. Unless my entries are always optimal, there will usually be significant retracements in trades that go on to make big gains. Trailing too closely kills good trades too soon.

2) I could have taken some size off along the way. The problem with scaling out is that you don't have much size on if you get a major move. Your equity curve will be smoother and easier to handle psychologically, and each trade will be easier to handle psychologically, but gains will not be maximized.

3) I could have set a closer target like 100 or 150 pips. Sure... but then I couldn't get 200, 500, or 700 pips on this trade... and if you look at the recent action in the Euro, you can see that such moves are possible in a couple of days. Moves like that are where the real money is.

It comes down to the fact that the psychologically most difficult way to trade is the most profitable way to trade. He who wants to make the money no one else is making must be willing to bear the whips and scorns that others are not willing to bear. Imagine how hard it will be when the money on the line is $20 per pip, instead of $0.20!

So what's the plan now? Looking at the EUR/USD, it would appear that we have a potential reversal pattern on the daily chart. We are already significantly above today's open, so I'm going to look to get long on a pullback. Hopefully the PPI and retail sales releases will give us one to work with.

Current closed equity: $59.15
Current position: flat
Current exposure: 0