this may or may not be mentioned in the school of pipsology, but i learned it from a seasoned trader in a chat room i hang out in.
after the trade has gone a few pips in your favor, exit half the trade and set a trailing stop at break even. this way you are already in a profit situation with much less stress.
good luck
Very good point but this may also cause you to miss a bigger move…
That’s one of many solid exit strategies. If you follow the blogs of Pipcrawler, Cyclops, and Happy Pip, they are fans and users of the strategy.
It sounds too me as if this is the �I need to be right strategy�. Not sure as I really don�t know how it is used. Is this a day trading technique? Sure from what I�ve herd you quickly reduce your risk, but how is the profits working out?
Why not scale out � at least at initial risk then set stop to break even?
For the past 2 months I have been doing pyramaiding (just the opposite) after I am up 100 pips I add the same amount i.e. if I entered a trade with 1 pip at 100pip I will add another 1 pip. My stop loss is 100 pips. Sure I am giving back 100 pips but if my math is right with just 5%risk I will double my account at a 700 pip gain. The down side is at 100pips up I am still risking 5% of my account but at 200pips I break even the rest is all up hill.
For the MT4 platforms that i use my trailing stop has to be 15 points behind the current price, so i would need to be up more that 15 pips for a trailing stop to work.