SKILLS TO ELIMINATING RISK OUT OF ANY
TRADE--PROFESSIONAL TRADING
I don’t
trade with TAKE PROFIT!
You never
want to close out a profitable trade in haste! The pain to sit and watch market
move heavily in your direction, soon after you closed that little budding profit
is so excruciating, and could lead the amateur trader to chase after spilled
milk. You want to first erase the RISK from the trade and then ride the profit
thereafter with great patience and skill.
Place
StopLoss at a logical price level where you would not be easily blown out
thereby missing out on what is later to become a huge potential profitable
trade.
You make a
miserable mistake by thinking that that little budding profit you’ve seen from
the trade you just placed is a real profit for your taking. This initial
shooting profit is to be seen as a bud of a little seedling or plant which is
sprouting and yet to grow into a full plant. You hurry to take it, and you are
cut from a potential huge profit soon to develop. This skill requires great deal
of patience! and patience!! and patience!!!
Be patient,
calm down your emotions; tell yourself “I aim for the bigger profit” and now,
allow the profit to grow for a while [Have you observed in wonder how a loser
unguarded can fly??????]
As the
profit grows, you now professionally erase the INHERENT RISK by gradually
moving your STOP closer to entry price level but not so close as you could
easily be taken out with the least surge in price movement. [Price ebbs
naturally. Get that! And, if you’re taken out, it’s not your grandmother’s
wish; it’s price nature]
You do this
step by step till you wisely and skillfully eliminate risk by replacing your
Initial StopLoss with your Entry price level. This is called Break-Even. Should
price soon kick you out of the trade, you gain nothing at all. The better side
of it all; you lose nothing!!!
Haven erased
the trade off risk; tis now time to consider paying yourself by locking in part
of the profit. This is the reward for skillfully, and professionally
eliminating the risk! This is done by moving the STOP beyond your Entry price
Level. And this literally locks up some cash!
Nobody said
you would not be kicked out of the trade. You could! I have often times been. If
you give greed a chance, you’ll find yourself moving your stop too close to
current price, and before you
realize, you’re taken out, and you miss the huge
profit the trade could bring.
When you
have eliminated risk completely, and have locked in some cash for yourself,
relax now and manage the trade for profit maximization. You shouldn’t get
emotional since you’re now in a risk-free trade. This is a whole task, as you
decide to trade manual, and you’ll get used to it with time and constant
practice.
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