Hi!
I am in a phase very I have some strategies that is, or is close to, profitable. However I struggle with setting Targets.
The thing is: I identify multiple support and resistance zones on the chart. Some stronger then others of course. Then I get an entry signal. However, placing the Take Profit on the first support/resistance level usually gives a pretty poor R:R. Placing it on a second, or a third, gives bettter R:R. However I feel very insecure about knowing which levels will hold and which levels will fall, when it comes to my Take Profits. (Weirdly this does not apply to my Entry-zones, which I feel relatively comfortable with.)
I see charts on twitter from some of the more serious range-traders and they almost always have an entry in on end and a take profit multiple support or resistance areas away. I’ve studied a lot and tried to figure this out but I struggle - hence this post.
I’m very greatful if anyone are willing to provide me with some insight.
Greetings,
Ben
The concept of R:R is a very tricky one, but let’s focus on the profit target level which I believe you are more interested in. The profit level is not necessarily on the price level of the next or next higher support/resistance.
Price range has a lot to do with it depending on what time frame you are trading. For example, GBP/USD has an average daily range of let’s say 90 pips. Let’s say you entered just when the pair has moved 25 pips already then it is reasonable to set your profit target at not more than 65 pips. However, if you entered at 70 pip range, then you cannot set your target more than 20 pips because it has a low chance of hitting it. If you think 20 pips is too low, then you may opt not to trade because you might be risking too much compared to what you may gain.
In my case, I look at daily range as boundaries, but my profit level is precisely based on what occurred on my analysis. I’m an intraday trader and my profit targets ranges from 12.5 pips up to 25 pips depending on what pair and I hold positions for about an average of 2 hours and maximum of about 4 hours.
I hope this helps. 
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