Lets say i am long and have a 4 handle profit. (so no misunderstanding the SP500, ES, NQ, trade in handles and fractions of a handle. The term points is old fashioned and comes from the out of date DJIA itself, the DOW reported is for the publics consumption.)
So LONG and +4 handles and looking for 5 handles to ring the register. Using stops when in profits is a seperate animal than when first entering a trade. So if +4 the trade is a success and the only subjective part left to ponder is would you ring the register now or try to nail the 5 handle and even more. First things first..............what is price action showing? Is the move at least an up bias? If price move slows i will yank it fast and not give back more then 25% of the profit. Taking profits actually is not using STOP LOSS. One would like to assume when entering a trade with a minimum goal in mind (5 handles) that you could use a STOP LOSS of 25% of the goal. That is a scary thought when considered naked. To defeat the math of making back losses and adding in commissions the trader must have good setups and be willing to ring the register and REENTER hopefully even better as the prior trade setup is still valid even if you took profits. Your job is to milk the trends and not let the STOP LOSS on entering trades milk you.
Beginners get hurt after they enter the trade because they do not use proper trade management once filled. More experienced traders know full well the hardest part of trading will always be trade entry because even a well disciplined trader can get out of a loser fast with a small loss but never be sure if even a well defined setup will play out correctly. Now combine both ways to get hurt as a beginner and this is not as easy as it looks.
Here is the simple math on taking 3 good setups but 2 do not work out. 2 are exited with small loss and the 3rd eliminates the small losers and gets you in the black. Thats a minimum daily goal and maybe even do that 2 or 3 times a day. The good news is some days price just throws you hugs and kisses and takes off early.
Making a run this weekend to Chicago. Have a good day all.
So LONG and +4 handles and looking for 5 handles to ring the register. Using stops when in profits is a seperate animal than when first entering a trade. So if +4 the trade is a success and the only subjective part left to ponder is would you ring the register now or try to nail the 5 handle and even more. First things first..............what is price action showing? Is the move at least an up bias? If price move slows i will yank it fast and not give back more then 25% of the profit. Taking profits actually is not using STOP LOSS. One would like to assume when entering a trade with a minimum goal in mind (5 handles) that you could use a STOP LOSS of 25% of the goal. That is a scary thought when considered naked. To defeat the math of making back losses and adding in commissions the trader must have good setups and be willing to ring the register and REENTER hopefully even better as the prior trade setup is still valid even if you took profits. Your job is to milk the trends and not let the STOP LOSS on entering trades milk you.
Beginners get hurt after they enter the trade because they do not use proper trade management once filled. More experienced traders know full well the hardest part of trading will always be trade entry because even a well disciplined trader can get out of a loser fast with a small loss but never be sure if even a well defined setup will play out correctly. Now combine both ways to get hurt as a beginner and this is not as easy as it looks.
Here is the simple math on taking 3 good setups but 2 do not work out. 2 are exited with small loss and the 3rd eliminates the small losers and gets you in the black. Thats a minimum daily goal and maybe even do that 2 or 3 times a day. The good news is some days price just throws you hugs and kisses and takes off early.
Making a run this weekend to Chicago. Have a good day all.
