Your set up gives you an entry; you have a stop loss and a target in place; the stock trades in a range between the target and the stop. Do you have a guideline as to how long you hold a stock?
When this happens I always exit for a smaller profit than intended. Notification that I've closed my small position is immediately released to institutional traders everywhere as a "breakout trade entry signal". I am not making this up.
no kidding, I could probably make more money just charging 99 cents a minute telling hedge funds what I am doing otherwise, that bracket trade is a rough way to make a living, ok for you youngsters, but it takes it's toll on you but to answer your question, the best quote is from Keynes, "The markets can stay irrational longer than you can stay solvent."
A good measure for this is to use momentum. As soon as momentum starts to slow, price will follow. The 9EMA is also a good tool if you are using a momentum system.
You been reading my mail; My other option is to tie up my capital for another week or so and wait for my stop to get hit. That way my small gain looks pretty good. How the Hell do "THEY" know what I'm doing? Could it be that I'm doing exactly what they expect me to do?
Are you looking for the price to come back to the 9EMA as a signal to get out? Do the following rules make sense? For Long position: Sell if price closes below the 9ema: If price trades below the 9ema but closes above it: set a stop just below that bar/candle. I have my stop set and am comfortable with the risk Iâm taking; Iâm wondering if there is a optimum holding period after which youâd be further ahead to cancel the trade and look for new opportunities for that capital. I remember watching a video years ago where the mantra was âenter on this criteria and hold until the stop or target is hit or for 5 days then exit the tradeâ. Just wondering if anyone does this type of thing.
If you're ever waiting for it to get back to where it was, that's the time to get the hell out of there, win lose or draw