Exit plan
I'm all about having a plan. A plan I can stick with no matter what the circumstances or market conditions. I really do feel like I have a great plan for entries, but my exit strategy has really been suspect, especially this past week.
As I posted last weekend, I tried to stick with exiting off the 5-min chart, but frankly, that took me out of good positions too early. I had been exiting off the 15-min chart prior to that but I felt I was giving up profits by waiting to be taken out. So... I thought to myself, why not use both timeframes - but with a plan.
As most of you know, my entries are almost always above the OR low for shorts and below it for longs. With every trade, I typically have 2 price targets - the OR low (shorts) or high (longs) and the fib. ext. The OR low/high is a high resistance/support area so sometimes it's good to take notice of how price reacts at this level. However, there's no need to exit completely.
NOTE: FOR THE PURPOSE OF SIMPLICITY, I WILL WRITE THE REST OF THE POST ASSUMING I AM GOING LONG ON A PARTICULAR TRADE. I WILL USE THE SAME LOGIC (EXCEPT IN REVERSE) FOR SHORT POSITIONS AS WELL.
What I will try to incorporate is following:
-use the 15-min timeframe as soon as I enter the trade. If price does not reach to the OR high, I will look for a candle to penetrate or close below the 5ema and then sell on a break of that candle's low
-if price reaches the OR high and looks like it's stalling, I will look at the 5-min chart. If a candle penetrates or closes below the 5ema I will sell HALF my position on a break of that candle's low -if I have sold half my position, I will then solely look at the 15-min chart for my exit... no matter what (even if it hits my original stop)
-if price does not stall at the OR high, I will solely look at the 15-min chart for my exit. However, if price reached the fib. extension during this time, I can feel good about selling all my position or what's left at or above the fib. ext.
Example of selling half at the OR high
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4 comments:
wiol be interesting to see how it works out.
as an aside... the 11:45 bar on AKS looks like a decent entry?
good luck
QQQBall
It was something that I worked on during my 2 days off. Very similar but I use 5, 10 & 15 (10 min as main exit)
QQQBall... the 11:45 bar was a nice X-style entry.
jerry... I was thinking about using the 10 as well, let me know how it works out.
just noticed that based on this exit plan, I would've actually been stopped out on a break of the 14th bar low (15-min). Oh well... maybe not a good example.
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