I'd argue that you can lose money buy taking profits. If you take big losers and small profits you'll eventually go broke. However, I agree with most of what you say. I usually let my trades run with a stop under the 23.6 fibonacci retracement of the current move. Since when the price breaks that point it's usually going to keep going down. I also usually don't like to lose more than 50% of my paper profits, so moving my stop loss up is a combination of that, and what my gut is saying about the movement of the market currently. My best tip for the OP is that you should define the objectives you wish for your profit taking to achieve and then design it accordingly. No set strategy will work for all traders, try what feels right for you and just keep improving it.
I had this problem many years back, then I added options to the equation and it solved my issue. If that's something you are interested in...
I trade mega cap with dividends, cost average with otm short put whenever a correction below the mean occurs, look forward to assignment. Also sell otm calls beyond my assign price close to top or resistence. mega cap seems to revert back to the mean. Touch wood but loses rarely occur.
It's great that you found a trading style that suits you, I have not looked to deep in to options yet personally as I found another style that suited me. I trade intraday and try to pick tops and bottoms risking only a small amount on entry. When momentum turns my favor I average up and move my stops based on TA. When I feel the move starting to exhaust I tighten my stop to lock in more profit, when I am a bit into profit I move stop to 50% guaranteed, and later 75% when it starts to exhaust. Only use fibonacci and looking at candlebars on 1m chart, and rigorous risk management/position sizing.
Additionally; Trailing stops are a sub-optimal exit. Assuming there's minimal alpha available, how can one expect to be long-term profitable with a sub-optimal exit? There's no such thing as locking in profits when it comes to systematic trading, you're either optimal or you're not.
When price in it’s current channel fails to traverse. The resulting retrace becomes a reversal. Posting a PV chart of your marketview would support the effort in understanding ftt’s.
I did not ignore all this advice.... @Xela great advice on looking at previous S/R and using ATR.... I have been playing with using a multiple on ATR for Stop/Target....seems like 1X to 1.3X is just right.... any thoughts
Well, that one was very much number 5 on a list of 5 possibilities ... but it's still probably an improvement on what you were doing before ... I'm quite surprised, to be honest (but I'm saying that without knowing anything about your trading plan). If you look in beginners' textbooks (such as Van K. Tharp's or Tushar S. Chande's, both recommended in another thread), you'll see that although they (wisely) don't give a number as "general advice", when discussing this subject, the examples they describe all have a multpiple of at least 2 x the ATR. And Tharp gives some explanations of the relative advantages and disadvantages of higher/lower ATR-multiples which really would help you. Honestly, without wanting to sound like I'm "dismissing the question", the answer's basically the same as the one for the subject you asked about in another thread yesterday, i.e. "test and see". Anything else is just guessing. You surely don't want to put your money on guesses, when you can learn the answer fairly easily by testing, for whatever you're doing? Granted, you still have to decide what to test. For myself, I probably wouldn't look at anything below 1.5, because I'd expect to be stopped out early too often, that way, on trades for which I've actually got the overall direction right. But checking it out for yourself is worth far more than asking other people their guesses (because that's all they are). Hard to say much more, helpfully, in abstract ...