I was stopped out of this position yesterday as a relatively-poorly-bid US Treasury auction and an agricultural report that presaged further food price inflation sent bond yields higher and risk assets into reverse. Palladium had advanced over 6 risk units and I had narrowed the stop to four risk units. I am still not sure whether this is the right thing to do, but it did mean that I took a decent profit out of this trade.

Should I keep the stop at its initial level and always sell into strength, accepting that sometimes a winning trade will turn around and come all the way back to the stop before I get a chance to sell? Or should I narrow the stop as the trade runs? I really don’t know. I need to do some back-testing in Tradestation to help me resolve this.