How to Exit a Profitable Position? (Part 1)

There are only two ways to exit a position - your way and the market way.

You can’t find a third way.

Your way requires you to have a predetermined profit target. 1x, 1.5x, 2x, 2.5x, 3x or even 10x of the risk taken, it’s completely up to you. I’ll assume that you’ve established a solid rationale for each of your profit target set.

If you set it at below 1x, I’ll be envy that you’ve got a strategy with super high win rate to justify the risk. My king, could you please share with me?

If you set it at 10x or higher, come on, man! Are you sure that's even realistic?

However, once the profit target is set, you must 100% commit to it. There should be no room for tolerance. You should not adjust it until the position is closed. Any attempt to lower or raise the profit target when the position is open is unethical. It is a sin. Why? Because it will disrupt you from being disciplined.

“I’m sure it will continue to go up. I don’t want to miss any profits. Let me just raise the profit target a bit higher. I promise I won’t do that in next trades.”

“I think my profit target is too high. Now that it brings in some profits, let me just lower the profit target and pocket the money while it’s still on the table.”

Sound familiar? Are you one of them? You change as the market changes. You're a slave to the market. What is the consequence? Absolutely. Being punished. You pay the price for committing a trading sin and not being disciplined.

Here’s how I do it.

After the profit target is set, I immediately close the chart, step away from it, work on something else and wait for the notification of profit target or stop loss being hit. I NEVER adjust the profit target when the position is open.

By doing this way, I’m controlling my own trade. I am the king to the market. The market is the slave to me. I let the market to fit into my strategy. I refuse to be controlled by the market. I refuse to be bossed around by the market. I refuse to be undisciplined which is costly to my trading career.

When the profit target is hit, I get the money. When the stop loss is hit, I get a highly disciplined self. Either way, I never lose.

If you set your profit target as $100 and stop loss $100, remember, it is either you win the $100 or lose the $100. Never other amount. Even when the price did go up to $99 and then reverse to hit your stop loss. No regret. Do not take any profits that sacrifice your discipline.

Now, pen this down:
It is either I win the $xxxx or lose the $xxxx. Never other amount.

This is your way to exit a position.

---Your Way to Becoming a Profitable Trader---

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