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Beginners look for promising entry points and they believe that when they find them that will give them money. Professionals on the other hand, spend a lot of their time managing their trades and looking for exits. If you truly want to trade with more profits than losses, you should consider the information below.
There are 2 kinds of exit signals: Stop Loss and Take Profit
Setting the Stop Loss
Your stop loss depends on your entry point, and so for each entry point we analyzed in the previous section you already know where to set your stop loss.
Trading the Bounce
Example for Buying the Dip: The stop loss should be below support G.
Example for Selling the Rally: The stop loss should be below resistance G.
Trading the Breakout
Example for Buying the Break of a Resistance: The stop loss should be below EMA (55).
Example for Selling the Break of a Support: The Stop Loss should be above EMA (55) 1-minute chart.
Trading the Trend Reversal (Failure Swing)
Example for Buying the Trend Reversal (Failure Swing): The stop loss should be below the failure level H.
Example for Selling the Trend Reversal (Failure Swing): The stop loss should be above the failure level H.
Set Your Take Profit
Close 50% of the position at 161.8% Fibonacci extension level and change the stop loss of the remaining at the opening price. At the next resistance close 50% of the remaining position (25% of the original position) and move the stop loss higher. At the next resistance close the remaining 25%.
