Let?s get it straight forward. I earned some money today. But, the problem is, according to plan, I should have earned more. Instead of closing the day with 3.5-R profit, I should have closed it with 5-R or maybe a little bit more.
Dow mini trade was the mistake of the day. I again closed the trade prematurely due to my psychological weakness. In fact, I did plan the trade before that, however, I decided to chicken out again, forgetting the darn rules.
Well, on the hindsight, I did see the improvement after when I start to work the plan, follow the rules and let the profit run. E-mini Nasdaq trade went pretty well with 3-R gain. My main problem now is EXIT. I have no problem with my stop loss execution. However, when it comes to exit a profitable trade, I do not have a concrete plan yet.
I had some discussion with Vincent on the topic of profit taking. We review some strategies used by bloggers like Mike and Maoxian. Maoxian was right by saying that
?in the end, everyone is different. i might be comfortable walking away from the screens and do OK and someone else finds they do best by never missing a tick … you have to know yourself, figure out what makes you tick.?
No single strategy is perfect, it comes down to trader?s personality and his/her ?Needs? of profit. Here are some links I have found related to this topic.
Taylor tree?s Scale Fish Not trade Part I
Taylor tree’s Scale Fish Not trade Part II
Trader Mike?s Note to self: Look to sell half
I enjoy reading your blog, and trade almost the same way (Thanks to Chairman Mao and Trader X).
I had the same problem with exits (and still do), but I learned a few things from great traders.
First, Dave Landry – try to sell half when you get to 1R. Thus you’ll have a “free position” as he calls it.
Trader X uses fibonacci extentions in his day trades. Try his blog for further info. It works for me too when I’m making a day trade (I don’t daytrade to much as I lack the funds).
Shay: Thanks. I will have a look at Trader X’s blog. btw, do you trade stocks or futures? Have a good day.
I trade only stocks, for now, since I lack the funds and platform to trade futures. However, I paper trade the Nasdaq and Russel 2000 futures almost every day.