GBPJPY at the London open: sizing stops by the pair's own range

[FXS London Scalper]

GBPJPY moves a lot in the first hour of London. Using the same pip stop as on GBPUSD is a common way to lose money on it, because the stop that's fine on one pair is noise on the other.

Check the ratio on your own data: average 08:00 to 09:00 range for GBPJPY divided by the same for GBPUSD, over the last 20 days. If it's well above 1, a GBPUSD-sized stop is too tight.

A sizing method that scales properly:

• Stop based on the 20-day average of the 08:00 to 09:00 range, around 15% of it. On GBPJPY that often lands in the 9 to 12 pip area.
• Position size reduced so the money at risk equals GBPUSD.
• A spread check before entry. At 08:00 many brokers quote GBPJPY at 3 pips or more for a minute or two; wait for it to come down to your threshold.

A worked example: account risk $50, stop 10 pips. A GBPJPY pip at a 1.0 lot is roughly $6.5–7 depending on USDJPY, so about 0.7–0.75 lots, against 1 lot with a 5 pip stop on GBPUSD.

Expect fewer trades per morning with wider stops. Log win rate and R per trade before and after the change to see whether it helped.

How do others set stops on yen crosses at the open?