For many forex traders managing a trade simply means entering a position with a stop loss (SL) and a take profit (TP). Done. So when price hits TP, trade over or hits SL, trade over.
But for YOU PERSONALLY what do you think is involved in managing a trade?
I think the process starts before opening a trade. Good analyzing and setting good SL and TPs are important.
But if we forget about that preparation, in my opinion managing a trade means to trust your analysis and do not change it when something unpredictable happens while the trade is open.
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I don’t wait until price hit my SL,i stop out if price go against my will.
The ultimate goal is not winning,but suffer less losses than expectation.
Exactly right, and even top pro traders fail to understand that. I have a pro friend who relies on past history chart patterns being repeated, and to a point up to this year that was a workable strategy.
However, he will leave losing trades to run longer than winning ones, and add to losing positions in an attempt to average out.
That is the fast track to becoming a loser.
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what if i tell you ,your friend could be right ,if only he figure out doing all these without blowing his ac ,if he did it i must congratulate him ,because that’s the holy grail he got there.
Like @PrestonRiver, most of the work for me is done once I open a position.
There is no room to move my SL once it’s set, except to protect profits. If/when it gets hit, I’m out of the trade and move on. And there’s no reason for me to close a trade early just because it’s going in the wrong direction. I fully expect price to move against me and test the SL level at some point.
This happened Friday with AUDCAD, price came within a few pips of taking me out then shot back down in the other direction.
TP is different, I aim for a recent swing low/high, but at around R:R 1:1 I move my SL to BE. I’m not stuck on RR’s but I look for min 1:1.5.
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hello nature girl. :))
never open a trade without a sl or tp limit.
Tasks in trade management include setting position size, monitoring the transaction, and executing exits.
It may contain a trade check list. Something along the lines of:
Check the balance of your account and any open positions.
Examine the Overnight Session.
Find out what the market sentiment is.
Examine the Economic Calendar…
Keep an eye on market news and events.
Look for key levels of support and resistance.
There are surely many ways how to manage a trade, but what does it mean “to manage” a trade?
For me, personally, managing a trade means monitoring it to ensure one of two alternatives:
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That it remains within the parameters and objectives originally set for it according to the overall parameters and objectives in my strategy (e.g. a typical TP/SL type trade where I might close it manually as “good enough” if I see it missed my TP by a few pips).
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That its parameters and/or objectives are changed according to changes in the discretionary elements associated with it as the trade evolves (e.g. increasingTP and moving SL to B/E or scaling in/out of the position size if the move is stronger than originally anticipated or some new external factor changes the original scenario from which the trade originated).
Sounds wordy but in practice it is usually pretty obvious what needs to be done. My overall aim is to ensure that my trades continue as trading (i.e. within my strategy) and not degenerate into gambling or wishful thinking…
In a briefer sentence: Managing my trades is about controlled flexibility rather than stifled opportunity.
Naturally, there is pre-trade planning and post-trade journalling/analysis but I am assuming you are referring to the time while the trade is live?
So what does it mean to you @THE_GOATE to “Manage a Trade”?
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I think that is the basic rule underlying trade management. To try to keep trades being trades and as you said not gamble or wishfulthinking.
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