Staying alive!!! Image from Game Mission
I must tell you, how many times I was close to hitting “SELL” and closed my eyes logging off! Everytime I read the news, checked out the chart, it’s screaming “get out” and I did not !If you think I have acquired the strength of an elephant (the body of which I am also beginning to resemble!) — I really have not. It’s mostly, thanks to my busy “new normal” of unfolding book promotion, “business as usual” demands at work and the things that still need to be unpacked at home, I’ve stayed away from my trade and all the better for it. My oil stock, STO had again defied gravity and negative market sentiment floating everywhere and moved up again. So yes, I’ve stayed away and kept the prospect of more profits alive. Funny right?!
But really, this is why we have a system, the set of trading rules that will form the basis of our trading success. With the rules, there’s no emotional rollercoaster ride. Yes, there are all these indicators, and my comprehensive set of questions (that I’ve shared in the book) to determine the opportunity — like the price information, volume, the number of buyers vs. sellers , but the bottomline is, what does the “rules” (system) tell me to do? Is the trailing Stop breached? If not, are the Exits satisfied?
Let’s check the trade so far — I’ve left the stock at 12.50, with the initial risk (1R) of 30c. With that 1R of 30c, and the stock moving to 13.76, the profit on the trade is 1.26 which is equivalent to a 4.2R profit. My target is 3R so the position has exceeded that profit.
Now how about when do I really get out? My trailing stop remains to be 30c from the last stop which is 13.76 less 30c which is now 13.46, up from the 13.30 I’ve set previously. We move the stop up as the trade moves in our favor to let us grow the profits while still providing that elbow room.
Do I think the “end is near” for this trade?
No – I don’t think. I let the stock defy gravity if it wants to and let the market take me out!
(Book available to buy online here!)
STO's gravity-defying ascent 7 Feb
