i don't trade mean reversion, but when you do, you must expect price to move in your trade direction, ie trend direction. cheers toucan
Now it's too philosophical considering the thread starter posted no charts and did not define what was a trend on the chart. Regardless, I never go anywhere without knowing my destination point. Simply, I don't take trades without knowing my profit targets and stop loss although I may exit a problematic trade before it reaches a stop. Just the same, I may exit a problematic trade before it reaches a profit target because shit can happen between point A (departure) and point B (destination). wrbtrader
I think an argument can be made that having a profit target is akin to calling a turn well in advance, in the context of one’s time frame. Why else would you exit at a profit target absent any additional consideration? The underlying assumption is that the market will likely change course at that point, otherwise it makes no sense to exit on that basis alone. And I can tell you that calling turns in advance is something I cannot do.
Profit targets should be based upon the performance of your trade strategy...not calling a turn in advance. For example, if your trade strategy averages about +5 points (your destination)...why would a trader set a profit target of +20 points in hopes of catching a trend ? A profit target doesn't imply you must exit at + 5 points or any other target your strategy has identified but it does imply when you reach that target...you need to do another assessment to determine whether to take that profit or stay in the trade because of something had showed up between point A (departure) and point B (destination) that would merit staying in the trade a little longer beyond the profit target (destination). wrbtrader