"At a certain point, there are factors in profit-taking that...

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14/09/20

22:43

Post #: 47336410
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Originally posted by YLJ: ↑

Good morning and good questions.

I'm sure a lot of people saw what I pointed out on that Wednesday bar a warning sign.
The failure to hold 0.78 after the top, as you mentioned was also a signal for some.
Some took profit right then (a valid intraday signal to do so) other took profit on the bounce
(such a bounce is common enough before the next leg down, which I why I believe it did not
succeed in retesting 0.97. There are day traders who will take profit on any strong daily move
regardless. I also think $1 is a significant physiological level and 0.97 is close
enough. If one tries to only take profits at exact numbers (however they are derived), it is usually
detrimental. Excuse all the down ramping lol...

If there was a perfect science to it, I would be richer than Bill Gates lol.
I do not believe it is possible to accurately pick tops consistently.
The first thing in protecting capital is not to keep real losses as small as possible.
The erasing part of paper gains is also a form of capital protection but a much more
difficult one. The trader who I respect most of all often says that the hardest trades
to manage are the winners, not the losers. Nothing could be more true. I do not
ever expect to fully master that aspect of trading and I am okay with that.

On a regular trade, I take partial (sometimes entire) profits at targets (which are usually
measured moves from chat patterns). If it shoots up through those levels I edge up my
stops incrementally unless we hit a major resistance where I will close out completely.
I often miss some further upside, but more often save myself from a drawdown.
At a certain point, there are factors in profit-taking that have more to do with money
management than with technicals. Nothing is accurate enough overtime to trump taking
(at least) some major gains off the table, even when there is some technical possibility of
further upside. The large percentage fluctuations between relatively close levels are the
difficulty of trading low priced stocks (works to the upside that way too though thankfully)...
I do not see how one can be a "LTH" and avoid the possibility of a 20% drawdown on stock
priced at these levels and still want to be an LTH.. It's a catch 22.
If that is the goal, best to use a trailing stop after a strong move but that is not an LTH strategy.
A lot of what I would say would depend on your entry price and some other factors...
It is precisely because there is no prophecies in technicals that those factors play a role.
All the best.

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"At a certain point, there are factors in profit-taking that have more to do with money management than with technicals."

Well said YLJ! This goes beyond even the management of your trading capital - you really have to consider using the sums as they mount or go down in the context of your own financial situation.

Thanks for your time in making your replies.

Phant

BRN Price at posting: 67.0¢ Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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(20min delay)
Last 24.5¢		Change -0.005(2.00%)		Mkt cap ! $454.7M

Open	High	Low	Value	Volume
24.5¢	25.0¢	24.0¢	$2.007M	8.185M

Buyers (Bids)

No.	Vol.	Price($)
21	1092673	24.5¢

Sellers (Offers)

Price($)	Vol.	No.
25.0¢	600300	28

View Market Depth

No.	Vol.	Price($)
20	1126537	0.245
45	1479660	0.240
25	854353	0.235
35	512381	0.230
13	261748	0.225

Price($)	Vol.	No.
0.250	588854	22
0.255	1166663	31
0.260	423475	10
0.265	222707	7
0.270	846109	16

Last trade - 14.36pm 03/05/2024 (20 minute delay)


Last 24.8¢		Change -0.005 ( 1.00 %)
Open	High	Low	Volume
24.5¢	25.0¢	24.0¢	5558375
Last updated 14.54pm 03/05/2024 ?

BRN (ASX) Chart

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