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A small detail that changed my results: I no longer place stops a fixed distance beyond a level like the Asian high. I place them beyond the furthest wick that tested the level.

Example: Asian high at 1.0850, but at 05:30 a spike went to 1.0856 and came back. A long breakout trade would have its stop below the structure as usual, but for a short fade at the high, my stop goes above 1.0856 plus spread, not at 1.0853.

Why:

• Stops above the level but under the old wick got hit by spikes that simply revisited the wick.
• The wick marks where orders already got filled once, so price returning there is normal.

The cost is a wider stop and smaller size. In my log, the stopped-out rate on fades dropped from about 48% to 40% after the change, while the average risk went up by around 1.5 pips. Overall R per trade improved a bit.

Do others do this, or do you prefer a fixed buffer beyond the level?

Choosing a stop is often treated as a matter of taste. Tight stops mean small losses, which sounds good. The market, though, has a noise level, and a stop inside it gets hit by randomness and not by being wrong.

Noise at short horizons has two parts: the spread, and the typical wiggle that price makes before moving on. A stop smaller than the spread plus a normal wiggle will trigger on many trades that would otherwise have worked.

A way to measure the floor is looking at the maximum adverse excursion of winning trades, how far price went against the position before it eventually won. If most winners dipped three pips before succeeding, a two pip stop kills them.

Plotting that distribution shows where a stop can sit with a minimum of cut-off winners. Often there's a clear shoulder in the curve, a distance beyond which few winners dip.

Tightening below that point raises the loss count with little saving, and widening beyond it raises the average loss with little gain.

The numbers differ by pair, session and strategy, so the exercise needs repeating when conditions change.

What does the adverse excursion curve look like for winners, and where does the current stop sit against it?