Search the Community

Hey Everyone, Below is a great question one our YouTube follower's asked and is one that we get quite often, answering it on a post oppose to the comments in YouTube comments in case there is anyone that can benefit from it. Based on YouTube Recap: https://www.youtube.com/watch?v=aufaWi5VS4g The answer is: Absolutely! When I first started trading live, I used to take profits way too early... and this happens to a lot of us. I wanted to take profits off the table right away from Unrealized into the Realized and put money right into my account. And on the loser's I would do the opposite, let them run in hopes of it turn in my favor. Those trades turned into the biggest trading losses I have painfully experienced. I had to learn how to take profits and is not as easy as it sounds and is not clear cut neither which is what makes it harder to plan for. There are a lot of things that I have to determine to set realistic and effective profit taking, like support levels, moving averages, entry position and most importantly price action. I used to get really hung up on hitting a support level when the price action is telling me otherwise and I end up breaking even or with a small profit. For me the price action has been the number one thing for taking profits. If the price drops .30 to .50 I'm taking 25% off the table right away because on average that is a big move for the stocks we are trading. This secures some profit and I still have 75% left to play with. If it drops another leg 20 or 30 more cents than i'm taking another .25 off. So this is aside from looking a levels once I have already taking some profits out this way, I ease back a bit and start looking for more signs and levels that support my price moving in my direction. These are not hard rules, there is no set tragedy, I am simply reading the price action at the moment and seeing what is giving me at that time. Also if my entry is not great, like FSLR on the above recap video, I know that the probability of getting another big leg down were not high so the minute it dropped I took profits and got out, the stock did eventually sold off and I could had made tons of money, but that's not they way i want to play the game. The probability of that happening over and over are not high so why take that gamble that is not in my favor. I hope this helps, I know is not clean cut like an ABCD Pattern, a lot of it is on feel and price action which can give off so many difference signals. Andrew is the king at this I highly recommend try scaling out of a trade if you are having issues getting out too early. Thanks. Carlos