Author's indicator for exiting the market. Forex indicator to close a position. The best ways to exit a forex trade. We use orders to exit the position. #8 - Time Based Exit

Indicators for the MT4 terminal are becoming more and more technical, have more correct predictions, but many traders and investors also want to see the best entry and exit points in the market. Most indicators only show the direction of the trend without showing exit points.

Often Forex indicators show much better profitability in the options market. Indeed, in binary options, in order to get up to 90% of the transaction, it does not matter at all what distance in points the price will run from the moment the transaction was concluded. In order for the trading position to close in plus, and the trader to receive up to 90% of the income, 1 point in the direction of the transaction is enough!

You can try your hand at option trading under fairly loyal trading conditions. For example, in a company, you can start trading with $10 in your account, concluding transactions of $1 or more.

Let's consider the indicator of 2017, showing for opening and closing orders, Ku Klux. This indicator is reminiscent of the famous pivots, it looks for rotating price levels on any currency pair, and each of its levels can be used as a level to enter or exit a trade.

Pivot indicator Ku Klux

The Ku Klux indicator is recommended to be used on the EURUSD, AUDUSD, GBPUSD, EURJPY, USDCHF currency pairs, on time intervals from M5 to H4. Trading can be carried out in all trading sessions, except for the Pacific, since during this period too low volatility makes it difficult to analyze the market. Recommended brokers for work - and.

It's better not to touch the input parameters if you don't know what you're doing. You can change the Text_Font_Size parameter to larger or smaller if you want to increase or decrease the font in terms of the indicator.

To work with this indicator, you need to use only pending orders. Buy with them from buy levels and sell from sell levels. Stop loss for purchases should be set at the BSL level, for sales - SSL. Placing stop orders is mandatory, this will reduce the likelihood of large losses and even reduce these risks to zero.

As soon as the profit begins to grow, the transaction must be transferred to breakeven, after the transaction reaches the nearest price level, then move it to one more level, etc. The deal is closed only by stop loss or breakeven, and also, when approaching the next important level for the trader.

This indicator is similar to the Murray indicator, but it is not a trading strategy. As with any indicator, it needs additions and filters, in the form of moving averages, MACD oscillators, RSI, etc. Active trading with Ku Klux, together with filters, can bring good income if money management is followed correctly. You should not exceed the risks of 2-5% per trade and open several trades on different currency pairs. If you want to trade on several pairs, it is better to break the total risk of 2-5% into several parts.

Sincerely, Alexander Ivanov

Good afternoon friends!

One of the most important rules in trading is: "It doesn't matter where you buy, it matters where you sell." So it turns out that money on the stock exchange brings us not entries, but exits from positions.How to make a decision to exit positions? How to reduce emotional pressure in those moments when you already felt profit in your pocket, your position began to turn around and squeeze out the hard-earned potential profit back? There is a solution - it is the systematization of exits from positions - fixing the rules under which you close the deal.Unfortunately, most newcomers, when they come to the exchange, are ready to suffer a big loss, sit out a deliberately false position, and close transactions with a barely appeared “plus”, deceiving themselves with the thought: “Well, at least not in the red ..” Recently, a “shock day” took place in shares of Sberbank, and it would seem that a powerful breakthrough has already occurred and the price has approached the level, and if you close, take profit, then now Here it is, the long-awaited exit from the range, and we caught some powerful impulses....We hide, we rejoice, but time passes and the market shows us all its power, all its potential. We understand that we missed a very cool move that we could have taken.disappointment, unpleasant sensations like this: “well, how is it, why did I close earlier, because you could still take ..”Let's look at the main methods of exiting positions.

1) The most common is a trailing stop, a trailing stop that follows a trend, is moved from one point to another. Trailing can move along fractals, along moving averages, along bar lows/highs in one sequence or another. pluses: allows profits to accumulate and grow, reduces psychological pressure on the tradercons: early exits due to market noise and, as a result, loss of potential profit can be provoked. If your trading system does not provide for re-entries, this will become a problem, a task that will need to be dealt with.

2) Target fix - the position is closed when the price reaches a certain level, say, a historically established support or resistance, a round price value, a place where large orders accumulate, while you need to understand that you should not set a take profit exactly on a round number, you should place your orders are either slightly lower or slightly higher.

3) The “enough is enough” principle- let's say you have calculated your trading system and it has approximately the following indicators for the profitability of transactions: the average profitable transaction is 6%, the maximum profit per transaction is 18%. Let's say that now at the moment you already have 15% profit on an open position, and historically it so happened that during the entire period of calculating your strategy you had 3 times when the profit was 17-18%, only 3 times!!! It would be logical to close your trade and take profit without waiting for a return signal or closing on a trailing stop.

4) The reverse signal is the simplest technique, we simply close the position when we receive a reversal signal from the Trading System.

You need to decide for yourself what you want to get from your Trading System, what should it do for you in the end? And in accordance with your goals - choose the method of exiting positions. All success and good mood.

Forex traders talk a lot about the perfect entry point, combining various indicators and basic conditions to find the best opportunities. Much less attention is paid to choosing a good exit point, although this is an equally important aspect. The best ways to exit a trade in our article. The correct choice of the exit point from the transaction in the forex market, read on.

One of the most logical way Exiting a Forex trade refers to the strategy you entered the trade with. You must have already planned the exit in advance. For example, if you enter a position at a moving average crossover, it is usually best to exit at the opposite crossover. In addition, if you bought on a breakout, you should sell when the price breaks the low mark. To exit a trade, you must have some predetermined criteria.

It can be used to protect against losses and fix profits. Used alone or in combination with another method. One of the difficulties of using a trailing stop is determining the distance from the price action. Placing an order too close results in taking profits too early. And setting it too far can mean that you don’t get any profit at all. Trailing stop testing using past data is a good way to find the correct distance.

The question is, is it possible to use these methods for i-trading?!

It is a good way to exit a Forex trade, provided you choose a realistic level. If the target price is too far away, it will not be reached and you will most likely end up losing money when the market reverses. Similarly, if your target is set too close, then you are not earning enough to justify your current risks.

Technical levels, such as pivot points, are an excellent price guide. They use the latest data to adjust to market volatility. Key reversal levels are realistic price targets for profit. In addition, pivot points are monitored by thousands of professional traders and are therefore better at predicting pivot points.

Technical indicators

Fibonacci, Elliot waves and other technical indicators are also good ways to exit a trade in forex, and are most effective in day trading. The mathematical Fibonacci sequence predicts tipping points with extraordinary accuracy, and the ATR indicator is a good tool for measuring price movements. Instead of choosing an arbitrary number of pips as your profit level, halving the ATR for the last 14 days will give you more realistic data.

Studying the statistics of the work of many traders, it is often possible to come across a situation where the trading analysis is done correctly and the direction where the price will go is correctly chosen, but due to the inability to determine the best entry point for opening a position, it is not possible to make money. A trader can catch one or even several stops, suffer serious losses, despair and decide not to trade, when suddenly the price, as if by magic, quickly flies in the right direction. Each trader is able to remember many similar stories, and in order to avoid such situations, you need an entry indicator to work on Forex, which will show exactly where to open a deal and where to hide the stop loss.

One of these tools will be discussed in this review, which will allow everyone to get an effective tool for opening deals. At the same time, the analysis itself can be made complex, relying not only on the indicators of the indicator, but also on macro statistics, the movement of futures, and so on. That is, nothing prevents making forecasting complex.

How to properly prepare for work

The main advice that should be given to every beginner before starting work is not to clutter up the price chart with unnecessary and incomprehensible tools. The workplace looks especially stupid, where trading instruments intended for the same purpose are located at the same time. For example, when there are several trend indicators or oscillators with the same principle of operation, etc.

Therefore, it is advisable to choose only the most necessary tools that will really help the situation, and not interfere with it. This is where you should definitely use the entry indicator on Forex, as this contributes to a significant increase in the chances of success.

Tool for pinpointing inputs

Most strategies and trading techniques are based on simple formations. One of them, without a doubt, is 1-2-3. This signal is of a breakout nature, which combines two important points - momentum and an accurate understanding of where the stop loss will be. This combination contributes to the formation of the best Forex entries, so we suggest downloading this indicator HERE.

Next, the file received in the archive must be installed in your MT4 trading terminal. To do this, launch it, click on the "Open data directory" item located inside the "File" menu, find the MQL4 folder and inside it "Indicators". Having placed the unpacked “Indicator” file here, MT4 is turned off and on again, and then on the left in the list of indicators of the “Navigator” window, they find the instrument of the same name at the very bottom and add it to the chart.

As a result, the price chart should take the following form.

When adding, in the "Parameters" tab, you can make additional settings for the indicator of inputs, if necessary.

How to access the settings and what to change there

If the indicator is already installed, and the settings need to be made in the process, then press the key combination "Ctrl + I", check the box next to "Indicator" and click "Properties".

Now for the settings themselves. For convenience, here is a screenshot where the main groups are marked.

The first three parameters, circled in red square, are the conditions for displaying the 1-2-3 model. If you increase the numerical values in the corresponding fields, then the pattern will appear less often, but its accuracy will improve. And vice versa - a decrease in digital values will give more signals, but the number of false ones will increase.

The following three options allow you to customize how the individual lines are displayed on the price chart.

The category of Show Targets settings, as their name says, is responsible for visually displaying targets after entering a Forex position. When catching movements, it is optimal to cover part of the position with a profit in advance, and hold the rest for a little longer. Therefore, there are two fields here. Target1 Multiply sets the first target separately, while Target2 Multiply, respectively, shows where you need to close the rest of the deal after entering.

The Hide Transitions option enables or disables channel building. Below in the screenshot you can see how the Forex chart looks like if the channel display is enabled in the entry indicator.

Having found out what can be configured and how, it is worth moving on to consider the practical value of the indicator.

How to use the indicator for precise entries in the Forex market

Before a trader who uses an entry indicator on Forex, there are 4 types of signals:

Opening a position on the market at the moment the arrow appears.
Wait for the arrow to appear, and then rollback, and only then enter.
Perform an operation upon breakdown of a local minimum/maximum (depending on the direction of the pattern).
Well, you can still enter, waiting for a signal to rebound from the horizontal levels that the indicator draws, in the direction of the index arrow.

Now let's look at examples for each situation separately in order to better understand when to make an entry on the Forex indicator signal.

Example of the first signal

The first option involves entering the market immediately after the arrow appears. In this case, the protective stop is hidden behind the last local extremum, and as a take profit, they are guided by the nearest border of the indicator channel.

It looks like this in the screenshot. Here is an example of buying and selling.

Example of the second signal

The second type of signal is more conservative, since here the entry to Forex does not occur immediately after the formation of an arrow in the indicator, but only when the price rolls back after the impulse. By the way, it is easy to guess where the correction will develop, since reversals usually occur near the levels.

In the screenshot above, you can see how, after the arrow appeared, the trader waited, and only then entered the market. The stop should also be hidden behind the previous local low for buy trades and behind the high for sell entries.

The risk of this approach is that there may not be a rollback, and the advantage is that the potential stop is much less than in the example of considering the first signal.

Example of the third signal

In the case of the third signal, there is a classic working out of the 1-2-3 pattern. That is, the entry point is a breakdown of the previously set minimum / maximum. That is, a trader enters on an impulse, risking a stop, but having a high probability of quickly reaching the target level.

Example of the fourth signal

An example of the last type of signal that the entry indicator gives on Forex looks very curious. It allows you to actually engage in scalping, opening positions at the moment of rebound from the level. In this case, the stops will be the shortest, and the ratio of profit to loss the most interesting.

Alternative ways to support transactions

Considering that trading is always carried out in the direction of the impulse and usually along the trend, instead of fixing deals on take profit at levels, you can try to hold the position counting on even more profit. In this case, the signal to exit the transaction will be the appearance of a reverse signal, that is, an arrow.

Below in the screenshot you can see how much profit the trader could get if he just held the position until the formation of a reverse signal. Compared to the classic option, where the deal would be partially covered, the exit after the appearance of the deal in the opposite direction gave more profit.

The numbers on the screenshot are chosen according to how the signals can be processed.

Time interval for entry

The indicator works equally well for finding entry points both in Forex and in others. financial markets. In this case, the time interval does not matter much. You can work equally effectively on M5, and on H1, and on D1. So here, as it is more convenient for anyone, the choice of a working timeframe does not give any special advantages.

If desired, the indicator's signals can be used to look for global trends, and then look for entries on Forex on small timeframes and hold a deal, focusing on a longer time interval. With this approach, the ratio of profit to loss can be 1:10, and even higher.

To improve accuracy, you can use the Forex entry indicator with other signals. For example, you can wait until the market breaks the trend line, which may indicate a change in trend, and then look for a pattern using the indicator and enter the market with a clear stop.

The outcome of the review of the entry indicator

You can use the operation of the Forex entry indicator quite accurately and without additional technical assistants. This tool gives the trader everything he needs to make a good trade, even taking into account some errors in the analysis, since the take profit is always an order of magnitude larger than the stops, and the entry occurs in the direction of the impulse.

According to statistics, the number of false signals is always slightly less than the correct ones, and given that the profit ratio is higher for successful signals, the trader will definitely always be profitable at a distance.

Each currency pair has its own version of the indicator; the authors of the strategy thought out the indicator separately for the required pairs in advance.

Introduction from the author

I am very happy to share this amazing package software with you. This product has been in development for several years and I hope you improve your trading and profit.

Please read the entire strategy before you start trading so you have the complete knowledge and fundamentals you need to make profitable trades. Please trade on a demo account before trading with real money so that you have trading experience and confidence in the strategy.

We are sure that if you apply the strategy in your trading, your profits will increase beyond your wildest dreams and you will enjoy a system with a high level of winnings and profitability.

We have made great efforts to present the material in this guide as simply as possible. If you have any questions regarding the material, feel free to contact us.

For your success
Forex Sabotage Team.

Characteristics and conditions

Trading platform: MetaTrader4 (MT4).
Currency pairs: EUR\USD, EUR\JPY, GBP\JPY, USD\JPY, GBP\USD, EUR\GBP.
Trading Hours: During the London and US sessions.
TimeFrame: M15, M30, H1, H4, D1.
Recommended Broker: Can be used with any broker.

Introduction to Analysis Technique

The main idea behind Forex Sabotage is to look at the big picture. The algorithm behind this uses cross pair analysis to determine the phases price is in, the start of new cycles, and the end of the current cycle. These are the ones we will trade.

Forex Signal Sabotage indicator uses dynamic D.S.P. An algorithm to find the relative strength of each currency as well as determine the "shift of power" that results in trading signals.

Each indicator line is tied to a specific currency pair, the list of pairs:

Blue color line: Euro
Red Line: Japanese Yen
Green Line: US Dollar
Gold color line: Pound

The second indicator of ForexSabotage is the Momentum Senes momentum indicator. It analyzes the momentum in the market and tells you when it is safe to enter a trade and when it is in a range you should avoid trading.

The 3rd and last indicator of ForexSabotage is the market information indicator. This indicator gives us all kinds of understanding of the current situation in the market: increase / decrease in volume, volume for buying / selling and a lot of valuable information about trading. 99% of this information you cannot see and is under the hood, this information can improve your trading.

The trading system is installed according to the standard instructions, which you can read in the following.

Interpretation and trading signals

In this chapter, you will learn how to trade with the ForexSabotage system.

You will learn how to use this system to achieve incredible day to day trading profits.

Purchase entry:

When Forex indicator Sense Sabotage Momentum changed color from blue to green.
If you are trading major pairs: confirmation from the Forex Sabotage Signal indicator is required. For example, if you are trading EUR\USD, make sure the EUR line is above the USD line.

Sale entry:

When the Forex indicator Sense Sabotage Momentum changed color from blue to red.
If you are trading major pairs: confirmation from the Forex Sabotage Signal indicator is required. For example, if you are trading EUR\USD, make sure the EUR line is below the USD line.

If you are trading on non-major pairs, ignore the last condition.

Trade entry examples

Exit a position

Stop Loss is calculated in the following way:

For long positions (buy), stop loss is set 1 pip below the lowest low of the last 4 bars.
For short trades (sell), stop loss is set 1 pip above the highest high of the last 4 bars.

The Stop Loss level for each trade is also shown on the Forex Sabotage Market Insight indicator. If you enter into buys, you need to look at the "Stop Loss for Long Trades" indicator. If you enter sales, look at the "Stop Loss for Short Trades" indicator

Trade Exit

Exiting a trade when Market Insight tells you volume is shrinking.
Another exit signal is when the Forex Sabotage Momentum Sense indicator turns blue. If the color changes and the bar is closed, exit the trade.

Money Management (determination of lot size)

The trade size for each trade is determined by the market indicator Info. It is calculated in such a way that you have a constant, 2% risk on every trade.

The archive contains several templates for the three main pairs, which were traded by the author himself, for all other pairs you can choose the settings yourself. Also in the archive there is a manual for English language from the developer.

I do not want to say that the vast majority of professional market participants use indicators to analyze the market. Most often, among the pros of the stock and currency markets, you will meet two types of traders: those who use trading advisors and those who use the analysis of trading levels and price patterns with volumes in their work. I do not urge you to make a choice between two styles of trading and I understand that for most beginners it will be easier and more accessible to analyze indicators of classical analysis.

Therefore, it is the use of classical indicators in determining entry and exit points that we will deal with in this tutorial. First, I would like to draw your attention to the fact that using only an entry and exit indicator would be unwise without determining the trend and other components of the market phase. In simple terms and discarding some of the nuances of the behavior of the exchange rate, we can say that there are only two phases in the market: a trend and a flat.

The constant change in the phase of the market prevents us from using the same trading strategy in different markets. Since, the one that works well on the trend will show disgusting results on the flat, and vice versa. This problem cannot be solved in one trading system, therefore, when developing the most profitable Expert Advisor in the world, we introduced a dynamic trading system into its algorithm that adapts to changes in the market phase. Only this made it possible to achieve such high results and get rid of the need for constant optimization of the strategy.

Therefore, before looking for an indicator to determine the best entry and exit points for a trade, think about how your strategy adapts to trend changes to flat and vice versa. Only such a concept in the development of a trading system will allow you to be sure that you have correctly identified the trend in the direction in which you will look for an entry point.

What are the ways to protect the entry point indicator from changing market phases?

Of course, there are no ideal methods, so I think that here the whole choice will depend on your individual preferences, which will allow you to confidently apply one or another strategy for determining the trend (market phase). In my opinion, the best tools for determining the market phase and its trend are trading levels, which are built according to the principle I have described. The ability to build consolidation, support and resistance levels will allow you to use exactly the trading strategy that is most suitable for the current market situation. And it has all the necessary properties for you to successfully earn money by changing the exchange rate of a currency instrument.

Therefore, my conclusion is disappointing: you must take into account the market phase and adjust the trading system to it (or use several for a specific market), otherwise you will never succeed in trading financial instruments. I say this for a reason, and I came to this conclusion quite recently, when we started developing win-win strategies for forex.

As you know, I don't draw conclusions until I automate a trading strategy and test it on a multi-year stretch of history. And I can say that it is the systems focused on changing the strategy for flat and trend that allow you to get stability on the exchange, everything else is a time bomb, because one day the phase will change and you will inevitably start to lose money. I am sure that each of you has already faced this problem for a long time and just now, I have announced to you the only possible solution.

Many developers of automatic forex robots try to solve the problem by stopping trading after a series of losses, but this method has big disadvantages. To voice which in this review seems superfluous to me. I will only highlight the main ones:

Closing a trade after a significant loss. It is psychologically difficult to wait a few weeks with such a large loss on the trading account, I am sure that only beginners use this method, and for them such trading is more like torture.

Impossibility to immediately win back the loss, and the market may recover after a negative series. Which again will unsettle you as soon as you see what you could earn here.

Probabilistic determination of non-trading time, since you do not analyze when the unfavorable phase will end and the next one, positive for your strategy, will begin.

What I have described above is only the tip of the iceberg, but it is useless to delve into the discussion of a system that is not well adapted to effective trading. So let's not waste time on it. Now let's move on to the description of indicators that will allow you to find the necessary entry and exit point from the market.

Why is determining the exit point as important as determining the entry point to the trade?

Perhaps some of the novice traders think that "I would like to find an entry point", but in practice, the inability to exit a trading position in time is much more important than the correct entry. Without knowing exactly where to take profits or limit losses, you will not be able to receive a stable income, this will only lead to even greater psychological problems in trading. I am a categorical opponent of manual trading, because human factor influences decision making too much.

However, if you are trading hands and still do not know the exit point of the transaction, then it is better to immediately sell your computer and spend more time away from on-line. This will bring more benefits to both psychological and physical health, not to mention your wallet. Therefore, when analyzing indicators of market entry points, I will pay special attention to the rules for exiting a position. And her support in the process of working with an open deal.

Forex trade entry and exit indicators. How to determine the exact trading signals to open a position?

We will consider with you two of my favorite classic indicators for determining the entry and exit points, but of course there are a huge number of them, listing which we will turn this review into a whole textbook on determining entry points. Therefore, I suggest that you start to value your time and study the most reliable entry and exit indicators.

Entry and exit point indicator - Stochastic Oscillator

If you do not know what this indicator is, then I recommend studying this review and be sure to use this analyzer in the first stages of your work on the market. It is a separate window on the chart of the financial instrument you have chosen and allows you to determine the points of maximum purchases or sales. It is calculated based on the square of the price for several price bars before the current moment, the square is determined by the analyzer period, and further price changes are diagnosed in accordance with the deviation of the current quotes from those in the "price square". The stochastic looks like this:

You may notice that when approaching the lower level (maximum sales), the price often bounces and goes up, and when approaching the upper one, the currency pair starts to decrease. This indicator works great on any financial instrument, many practitioners recommend using it on several time intervals for a more accurate trend analysis. If entry points for the stochastic indicator are less and less clear at first glance at the analyzer, then the exit point is determined when the main line of the indicator crosses with the additional one. Usually, this always indicates a trend reversal.

Entry and exit point indicator - CCI

I want to draw your attention to how accurately this indicator predicted the results of the Brexit vote and how well its signals are processed when approaching levels 200 and -200. I assigned these levels myself, there are no these levels in the standard settings of the CCI indicator. It is believed that it is necessary to make purchases when the level of 100 is broken and sells when the level is broken - 100. I recommend sticking to the CCI rebound rule from your levels: that is, when breaking the level of 100 or -100, we wait for a return to the level and a confirming rebound from it towards our positions. This is a more reliable signal from the CCI indicator or the definition of an entry point.

To determine exit points from a position, most in a simple way will wait for the indicator line to break through the level of 200 or -200 and take profits. At the same levels, experienced traders open trades against the current trend. Since the finding of the indicator beyond the levels of 200 and -200 indicates an imminent trend reversal. In addition, it allows you to get the most profitable trades, because the distance from -200 to 200 is much greater than from 100 to 200. I strongly recommend this analysis tool, both for a beginner and for someone who considers himself a pro.

Indicators for the MT4 terminal are becoming more technical, have more correct predictions, but many traders and investors also want to see the best entry and exit points in the market. Most indicators only show the direction of the trend without showing exit points.

Often Forex indicators show much better profitability in the options market. Indeed, in binary options, in order to get up to 90% of the transaction, it does not matter at all what distance in points the price will run from the moment the transaction was concluded. In order for the trading position to close in plus, and the trader to receive up to 90% of the income, 1 point in the direction of the transaction is enough!

You can try your hand at option trading under fairly loyal trading conditions. For example, in a company, you can start trading with $10 in your account, concluding transactions of $1 or more.

Pivot indicator Ku Klux

Sincerely, Alexander Ivanov

Editor's Choice

Very often in my articles I tell how to enter a position. Any strategy describes in detail the opening of a transaction, but, as a rule, pays very little attention to exiting it. Today I would like to correct this small flaw and talk in detail about how you can and should get out of their positions. I think that this article will be useful even for those who have their own strategy with a detailed description of the exit, because it can draw your attention to such nuances that you usually miss.

So, let's begin. I must say right away that there is no one - a universal way out of the transaction. It all depends on the specific situation. I usually open a trade on a price action setup and the correct exit strategy is very important for me, as there is a chance to lose all the pips earned in the trade. The first way (it is also the simplest) is to set the stop loss level two times less than the take profit level. For example, if your take profit is 100 pips, then your stop loss will be 50 pips. At the beginning of my trading career, I used this tactic very actively and I must say that it helped me out very well. With this exit tactic, you only need to slightly increase the ratio of winning trades to losing trades and you will always be in the black at the end of the month. However, this tactic has one significant drawback - it does not take into account market conditions. It happens that the trend changes, but you will know about it only after you are closed with a loss.

Another fairly simple exit tactic is the trailing stop. You can use this option in the terminal, or you can independently move the stop loss following the price. This strategy also has its pros and cons. The pluses I will attribute the simplicity and flexibility in using the market situation. Using this method is very simple, after the close of the next candle, you move the stop loss below this or the previous candle for buy trades and above for sell trades. The downside is that when there is high volatility in the market, you can easily be knocked out of a profitable trade.

Most often, I use exiting a trade by levels. For me, this is the most correct and logical exit from a position, both profitable and unprofitable. Let's start with the fact that I usually open deals at levels + price action signal, so it's logical to close at the level as well. For take profit and stop loss, I choose the nearest significant support and resistance levels. All the levels I have already plotted on the chart before the start of trading, so this procedure is not difficult. The main thing is that the levels are really strong, and not intermediate. I already wrote in detail about how to find levels.

Previously, I also used the technique of transferring a trade to breakeven, but after analyzing my trades, I abandoned this idea. In principle, this tactic is not very different from a trailing stop, so I see no point in describing it in detail. Let me just say that after several months of working with breakeven, I realized that I was losing a significant part of the profit due to the fact that my trades were closed too early. That is why I abandoned this tactic and do not regret it.

Another tactic, in my opinion, the most difficult and sophisticated exit from a position is a reverse signal. I advise only professionals to use it, I also use this method. As I said earlier, since I don't make any secret of my trading, I mark strong support/resistance levels and wait for a strong price action signal at those levels. If there are additional points of convergence, this is always welcome. I do not put a take profit or stop loss, although I mentally mark the level, if the price goes lower, then most likely my trade will no longer be profitable and I will need to close the position. I also know where price might have trouble moving further in the trend and I will keep a close eye on that level. If I see a reverse signal at this level, then I close the entire trade. If not, then according to the situation, it happens that I partially close part of the position and see how the price behaves. There are no ready-made recipes here, everything depends on the market situation, but this is the main advantage of this tactic.

I hope this article was helpful to you. Good luck!

The ability to exit a trade correctly is a key quality of a successful trader. Those who fail to become successful tend to get out of profitable positions too early and stay in losing positions too long. So how do you properly manage your exit from trades?

One of the main components of this process is the ability to manage your emotions such as fear and greed. Fear causes a trader to exit too early for less profit on his, and greed - holding a position too long. Having a clear exit strategy in place before a trade is made will help remove harmful emotions from the process. The ability to act consistently will allow the trader to tip the odds in his favor.

In this article, we will look at three methods that can help make trading more successful. Strictly speaking, the first method is not part of the exit strategy, but it plays a key role in correctly entering the trade when.

Position sizing is an extremely important step in every trade. However, most people do not bother with such calculations. When trading realistically, we cannot expect to be right on every trade. Some of the trades are bound to be unprofitable. Therefore, we need to be sure that the inevitable losses won't force us out of the game. How to achieve this? You need to consistently approach the choice of the size of your positions.

First of all, you need to set a limit for the position size. This amount will be different from the amount you are willing to risk on each individual trade. If you set your position size to 20% of your account, you can have 5 open positions at any given time. If you open positions no larger than 10% of your account, you can already have 10 open positions at any given time.

If, for example, your account balance is $50,000, and you decide that positions should not exceed 10% of the balance, then the amount of each open position will not exceed $500. In this case, you can buy 500 shares at a price of $10. Let's say you want to open a position in a stock that costs $25. Then you won't be able to buy more than 200 shares. By opening both of these positions, you will receive two identical trades, despite the difference in the price of the instrument.

By applying the uniform approach to position sizing described above, you can better manage your wins and losses by avoiding catastrophic account balance drawdowns even when you hit a losing streak.

Maximum risk:

Even though you limit your positions to 10% or 20% of your balance, that doesn't mean you're willing to risk all of that amount. The risk should be much less. If you risk 10% of your account balance on every single trade, then after ten wrong decisions, you will have to close this business. Your risk should be only 2% - 5%.

A 2% risk gives you the opportunity to be wrong 50 times before you crash. Such a scenario is extremely unlikely. A 5% risk gives you the opportunity to be wrong 20 times before you crash. By keeping your "risk per trade" low, you increase your chances of success.

Target Profit

How much can you earn in the trade you are about to make? When will you need to leave? By finding the answers to these questions before entering each trade, you can confidently move on the path of becoming a profitable trader.

Let's say you're looking at two $10 stocks that, according to your trading style, are ripe enough to start moving up. Both stocks have strong support at $9.50, so you plan to exit the trade if the price falls below $9.50. In other words, you are willing to risk 50 cents on this trade.

You then determine that one of these stocks has an upside resistance level at $10.50, and the other is near $12.00. Which of these deals is the best? Obviously the second one is better. Let's see why.

When a stock moves up, the logical place for it to reverse and pull back down is resistance levels. Unless you are an investor who buys and holds stocks for long periods of time, you are unlikely to want to sit out pullbacks in stocks. So in the case above, you could make 50 cents in the first stock and potentially take a $2 move in the second stock.

It's easy to calculate that $2.00 per share is much better than $0.50 per share. But it is even better to look at this situation from the point of view that in the first stock, your risk is equal to the amount of potential profit. That is, to take 50 cents, you must be willing to risk fifty cents. In second position, the willingness to risk 50 cents opens the way to $2 per share earnings potential. That is, the possible profit is four times the risk.

It is always necessary to strive to make trades for which the potential profit is at least three times greater than the required risk. Even better, if this ratio is 5:1 or even more.

Proper position sizing, risk management, and risk/reward ratio will help you become a successful trader.

The most undesirable scenario for traders is the return to the market of all profits that have been achieved in a transaction that has not yet been closed. The best way to protect yourself from such a scenario is to use a trailing stop loss order. Its idea is simple and quite corresponds to the name. He stops losses, preventing them from growing. It is very important to place a stop order correctly. If placed too close, it can lead to a premature exit from the trade. If you put it too far, then if the price goes against you, the losses may be unreasonably large.

When placing a stop order, you can bind to moving averages, trend lines and horizontal levels, since all of them can act as support / resistance levels. By hiding the order behind them, you can exit the trade if the price manages to break through a significant level.

If the trade is going in your direction, as the price moves, you can move the stop order beyond the next significant level or support/resistance zone.

If you have a plan in advance, according to which you are going to move the trailing stop loss, you can eliminate unnecessary emotions from the trading process. On the one hand, you should not place a stop order where, presumably, the price can go with a high probability. On the other hand, it should be exhibited at a level that makes sense. There is an old saying: "What goes up must come back down." No stock rises indefinitely. Any deal will have to exit sometime, the only question is when? A stop order allows you to exit at a logical level, rather than obeying emotions.

Using limit orders

A limit order is used to limit profits. If you are going to close a trade at a certain level, you can place a limit order there. It will only work when the price reaches the level you set and will close your trade. Remember that in this case you still need to apply a stop order. When one of these orders is triggered, don't forget to cancel the second one.

There is nothing wrong with taking profits. But if you limit your profits all the time, you will never be able to catch big moves. To do this, you need to sit out price fluctuations. It is very important to know in advance where and how you will exit the trade - by limiting losses or taking profits. Managing the exit from positions requires skill, but the effort expended will pay off with a vengeance.

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