There is no perfect time to bank your
profits
Many people simply focus on the trading setup and how to enter the trade
http://www.netpicks.com/day-trading-books/
Think of trading as being an exceptional risk manager first
Are entries important?
Get trade on in consolidation
Give stop wide berth for flushes
…it's probably going to end up being a wasted opportunity for you.
It's impossible to get your exit (or entry)
perfect even if you've done everything right
We never know the right decision until some time in the future after we've made the decision
Big winner turns into big loser
Lead to a trader acting more quickly in taking
their profits in the future
Snatching at profits
More and more trades continuing way past
where they have exited
Rabbit in headlights
No idea whether to hold or exit
Acting decisively when sufficient information is available is a key
attribute of successful traders
Have pre-planned method of exiting trades before you
take them
Target Levels
Fixed targetDynamic targetMarket levels
Profit Stop Triggers
Trailing stopReversal activity
www.netpicks.com/failure-test-trade-setup-in-action/
Flexibility of size
Let's look at a hypothetical trading
example
Buy 3 contracts of NQ @4170.00 - stop of 5 points.
Your risk on the trade is $20 per NQ point x 5 points x 3
contracts = $300
Risk on the trade falls to $20 x 5 points x 2
contracts minus $20 x 3 points x 1 contract =
$140
Another 1 contract off @ +6 points - risk on trade is $20
x 5 points x 1 contract minus $20 x 3 points x 1 contract minus $20 x 6
points x 1 contract = - $80
Your trade will be up $80 if the market comes all the way
back to the initial stop
Trading is a marathon not a sprint
A smooth equity curve leads to emotional stability as a trader and to bigger size
Until you make that cash register ring your
profits are not real