Dear FXCM,

My question are in a few parts. Before I start, thank you for reading =)

Last night (Thursday 5/9/07) I was researching to see what positions I could open. I usually do this at night 11pm - 1am, because this is the only time I have free (so I really don't have that much time). Reports said GBP's value have accumulated in the recent weeks in expectation of the rate hike, so the 25bp rate hike would effect the pound by little, if any. I figured I would long the GBP/USD with a 40 pip limit to catch some uptrend before the rate decision. However, overnight the pound dropped 100+ pips, and my GBP/USD long position took an obvious lost. What did I do wrong here? What signals could've told me about such a large dip? What didn't I take into consideration? I wanted a short term trade to take some quick profit, and I failed miserably.

My second question, is a reoccurring situation when I place trades. I try to stick to a 1:2 reward ratio, where the 1 is the stop and the 2 is the limit. I often find myself setting a stop near support in the range of about 30-40 pips, and when i multiply that by 2 for the limit, I find the goal to be higher than I think is possible (for the short time frame I want to hold the position). The currency often reach near my limit, and reverses, and sometimes end up in a lost. When i want to average 30-40 pip gains overnight, where should I draw the line for stop/limits. Is going 1:1 ratio a mistake?