This deviates slightly compared to what I previously always shared and focus on a profit target and that just.. Only take it when it hits, right? So this is the part where I actually did not elaborate more. This is slightly more advanced because it requires more effort to monitor, right?

Because if you set the profit target you just let it hit then you get out.

So you don’t let your emotions get swing in the wind.

However, if you are to a point where you are very comfortable with cutting losses, you are really comfortable with just getting out on your profit target or whatever, you want to be able to optimize your exit further.

The one way you can go about doing it is to monitor how the price developed along the way.

If you do notice that the price as it comes to your profit target, which usually in this case is going to be somewhere near a support level, right?

Okay, so when it comes near to that, sometimes you might notice that it will start to turn back up even before it touches your profit target in terms of this short trade that you have.

If you see a bullish candlestick reversal pattern and it’s a very pronounced one, then it is actually okay to consider getting out when you see the bullish reversal candlestick pattern, okay?

So in this case you are deviating away from the profit target that you have set, all right? Okay, but however if you decide to do this now, you must make sure that in your trading plan, you must factor for this possibility and contingency.

Interested to receive mentorship opportunities like this with Philip?

Find out more at traderwave.com/innercircle

Philip Teo

Founder & CEO at Traderwave Pte Ltd
Philip Teo is an entrepreneur, speaker and trading coach who specialises in the field of Technical Analysis of the financial markets. He is currently the Founder and CEO of Traderwave Pte Ltd, a financial technology company that offers a web charting application to global traders. He has conducted many trading seminars and appeared on national television before. He is also currently an official speaker and trainer with SGX Academy. Learn more about him at his Google+ Profile, LinkedIn Profile and Facebook Profile

Ready to Trade Profitably?

Get our latest updates and trading ideas in your inbox