Why is it hard to take profit?
When I started to write down all my trading rules, I quickly learned that I needed to make “TAKE PROFIT” a top priority. Why is it hard to take profit?? Because for me, I get greedy. I think that I can make more pips than what I already have made in a particular trade. I lose sight of a target price. So my top three rules currently are:
1. Protect trade account at all costs (capital preservation!).
2. When in a trade, if price moves above 15 pips profit, move stop to break even. Once in profit, move stop to +15 pips minimum acceptable profit per trade.
3. Use fibonacci extensions to find profit targets.
My criteria for entering a trade comes later in my trading rules, so that I see my top three rules first. For me, I learned that I must take greed and emotion out of the trading. I keep my trading rules on my desk in front of me as I trade every day, right next to my trade cheat sheet. So a minimum of +15 pips per trade sounds like small potatoes, but at the end of the month they stack up, big!