I timed the entry on this AGNC short trade perfectly

I timed the entry on this AGNC short  trade perfectly, but tightened up my trigger way to much when it started to show some profit. So I came up with some revised rules about how to set trade exit triggers. Triggering too early in this AGNC short trade, I covered my commission, but then adjusted the trigger too soon and too tight. The trigger closed the position at a negligable profit, but the next day there was a huge gap down to the price that would have allowed taking a 3% profit in only 3 days - which is right on target for my desired profitability of 1% profit per day in the market.

First cover your commission, to make sure you are not preoccupied with commissions eating into your profits because of trading too much. If you a just a small investor where you are measuing the success of a trade in how it compares to paying your monthly electricity bill, this is a factor, even with $10 commissions.  


Next set the trigger to about the Average Daily Range above the closing price, on a daily basis for the sort of momentum/swing trades I do.  On the AGNC trade, this would have been about 40c above the Friday close, so $28.98. That would have locked in a good chunk of the gap down, but leaving some space for the likely volatility that may occur because of the sharp dip in price.