When your trading strategy is based on cutting losses and letting profits run, and you do not seek for your operations to close after having set a target, you will have to face various situations, not technical ones, but mental ones so that the final balance of your operation grows as much as it needs to grow.
What I have clear is that by trading with targets I have never managed at any moment to achieve the profits I have achieved by letting them run.
That said, it is not easy to do. Let's see why:
Not putting a stop in front of possible losses is only within reach of those who think they will never fail in any operation. And not calculating the number of stocks, cryptocurrencies, or contracts to enter, referencing the total capital of the account, is like driving with your eyes closed.
But this is not the difficult part since, once accepted, you only have to do some calculations and that's it.
The difficult part comes when allowing profits to run when the operation is already in profit:
I didn't even close when the quote began to reverse along with my profits. I have learned the lesson well. I even allow my stop to be hit before not letting the position run, even if good profits end in losses.
(There were not few operations where the quote dropped to the stop and then continued in my favor but with me out of the market.)
They say you learn from losses. I had many back in the day, so I had a good teacher. Many times, when I traded without a stop loss, I recovered the losses, and just when they were about to enter profit (sometimes by a few pips), it would turn around and incur even greater losses.
Now I use this experience to my advantage, but with the profits, that's why I never move the stop (I know that the quote will often try to come for it and then turn around) unless the profits are very abundant. I always move everything to Break Even, but even to do that, the profits have to be large and consistent.
Entering the realm of profits means entering volatile territory, no technique works, everything is at the mercy of the trader's feeling and experience.
I only use horizontal support and resistance lines on the chart.
At first, I included everything, but the signals interfered with each other. One indicator gave me a buy signal and the other a sell signal. If I lowered the timeframe, it was chaos; it gave me entry and exit signals all the time. Everything was more complex and confusing.
As I eliminated elements from the chart, everything seemed simpler and easier to interpret, until I left it almost 'bare'.
I don't remove the candles because that can't be done anymore 😀
Well then:
It's very difficult to hold a position without closing it when you see that while being in profit, it is reduced and threatens your stop, but then it is easy to do when you understand perfectly that if you do not give up the crumbs, you will never aim for the most important profits.
It is very difficult to hold on, due to boredom, when the quote is lateral and you don't know where it will break out, but it is also easy when you understand that the money is in that boredom.
It is also very difficult to withstand a second blow from the quote against you without closing. These are direct hits to your buoyancy, and if it is difficult to withstand the first blow, the second and third are even harder.
But the wait has its reward, and after trying, the market mentally crushes you with its best weapons, it is when the reward arrives, the quote moves decisively in your favor, and now you can raise the stop to Break Even.
Therefore:
Consistency is not in trading with targets but in letting the position run in your favor. If you do this, you can even grow a small account. If you trade with targets, you cannot.
It is crucial to understand that there is no suitable technique to let profits run and even less to exit a position. This is clearly at the mercy of the particular interpretation of each trader, being at this point where traders differ the most from each other, just like their profits. As always, experience is key.
