Hi Jpygbp,
Placed your 20 and 200 SMA's on the 5 minute chart. Then follow the 20 SMA to the left of the chart to where the last 20 SMA and "price" cut occurred. That is where your resistance (in a downtrend) or support (in an uptrend) is. If the currency fluctuates or turns, those 20 SMA & currency price areas can either be your profit target objective if the trend has turned or 5 pips further away from that point can be your stop if the currency has just fluctuated.
This is for Forex1:
The CHF/USD runs quite a distance everyday. On a good day up to 250 pips. This is of course not a straight run in one direction. Because it runs a longer distance than the other majors it usually fluctuates a greater distance than the other majors. When I look at a major breakout and I am set for a momentum run, then for CHF/USD I look at a stop of about 50-55 pips. Anything smaller will just take you out of the market. However you have to make some sort of calculation prior to entering your trade in terms of risk/reward. If the reward (potential profit target is at least 2 times your risk of 50pips then I don't short change myself.)
Good trading
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