From Mark Mark Deaton newsletter mark@renegadetrader.com
We'll first thing you need to do is understand the stages of your potential exits - when MIGHT you get out.
1.STOP LOSS - Step 1 is a stop loss - Literally when the trade goes against you from the start, this is the first time you would consider an exit.
2. IMPULSE MOVE UP - The next point of exit is when price is extended in the direction you forecasted, when price begins to move up, are we tolerating a pull back ?
3. MULTIPLE IMPULSE MOVES UP - The last time at which you would consider an exit is after many impulse waves up. In other words price went up, pulled back, went up and pulled back again and now went up. At what point to we decide to remove the position and take profits?
Before you enter any trade you need to think about all 3 scenarios you need to decide in advance what your going after, hopefully you have a plan of action and you know in advance EXACTLY what sort of target your shootin' for.
For example many times after I enter price prints a low that is lower than my entry, sometimes its much lower - My strategy ? When price prints this low I know that there is a very good chance that it will close up higher. If it closes low I'M OUT IMMEDIATELY.
If you want detailed info., on how to plan all these potential outcomes in advance you would do yourself good by checking out my complete traders arsenal for here -
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