As traders, we are often anxious to get into a new position.
If the price gaps against us, we naturally want to chase it. Even if it gaps in favor of our trade direction, I find we want to do the same.
This is a trade plan detail that must be hammered out. There are many different theories on this very subject matter.
But personally, I’m a “let it come to me” trader…
If the price action doesn’t work out, then the trade wasn’t meant to be.
You have to be indifferent about it…
Because if price gaps in favor of my objective and I chase it, I’ve just added to my risk.
If it gaps in the opposite direction, it may never go in the right direction, and now I’ve just bought myself a stopped-out position.
I take extra time and effort when it comes to setting up my trades for this very reason.
Don’t Let a Good Trade Go Bad
I place three orders when I trade, and I set one alarm with each position.
My first order is, of course, my entry. Second, I place my stop. And third, I place my target.
Then, I head over to my favorite charting platform and set up my alarm.
I set an alarm 1% from my target. Why?
So I can move my stop to breakeven if price action comes that close to hitting my target.
I’m not going to let a good trade go bad on me!
I basically just set it and forget it…
Trade the Plan
Now, I really like end-of-week trading because I can set up my orders for the following week over the weekend.
They enter on their own, and the stop and targets are in place.
I simply set all of my orders to “good till canceled,” or GTC, meaning I don’t have to worry about them disappearing.
I can live my life and let my money make more money for me as I’ve laid it out in my trade plan.
Join Us for a Special Alpha Stocks Session
Before I go, I want to personally invite you to a special LIVE presentation with my colleague and expert stock trader Ross Givens.
Ross’s premium Alpha Stocks research service focuses on only the very best stock trading opportunities — both on the long side as stocks rise and on the short side when markets are crashing.
He recently recorded a huge winning trade on the downside in only eight days as Pegasystems Inc. (PEGA) stock plunged…
Rules to Live By
“A man who dares to waste one hour of time has not discovered the value of life.” Charles Darwin
Until next time, I wish you a beautiful and blessed day!
Yours In Trading Success,
Anthony Speciale Jr.