Placing profit targets is often a difficult task, both technically and emotionally. The problem is that none of us want to exit a profitable position when we think that there is more money to be made. However, it is far better to take a reasonable profit rather than lose everything because you have overreached. Your profit target should take into account the amount of risk associated with the trade – if you can’t see your way to making that profit level with the current trading conditions, then you shouldn’t open the position in the first place.
Again, specific profit target positioning depends on the strategy that you are trading. However, the first thing to look at is where a reasonable profit is given the risk in the trade, and then to see out there any barriers such as resistance levels between the current price and that target level. If there are, then don’t execute the trade – don’t kid yourself into thinking that your trade will breakthrough levels and achieve profits if a completely logical look at market conditions says otherwise. Read More
Again, specific profit target positioning depends on the strategy that you are trading. However, the first thing to look at is where a reasonable profit is given the risk in the trade, and then to see out there any barriers such as resistance levels between the current price and that target level. If there are, then don’t execute the trade – don’t kid yourself into thinking that your trade will breakthrough levels and achieve profits if a completely logical look at market conditions says otherwise. Read More
Do you want to learn more?
REPORT: How to set profit targets and control losses - Neil Rosenthal
REPORT: S.E.T. It Up – Three Parts of a Trade - Rick Wright
REPORT: Money Management and Determining How Large Your Profit Target Should Be - Rob Booker
Editors’ Picks
EUR/USD retreats below 1.0700 as USD rebounds
EUR/USD lost its traction and retreated slightly below 1.0700 in the American session, erasing its daily gains in the process. Following a bearish opening, the US Dollar holds its ground and limits the pair's upside ahead of the Fed policy meeting later this week.
GBP/USD holds positive ground above 1.2500 on weaker US Dollar, Fed rate decision looms
The GBP/USD pair holds positive ground near 1.2520 on Monday during the early Asian session. The uptick of the major pair is supported by the softer US Dollar below the 106.00 psychological mark. Investors will closely monitor the Federal Open Market Committee interest rate decision and Press Conference on Wednesday.
USD/JPY recovers toward 157.00 following suspected intervention
USD/JPY recovers ground and trades above 156.50 after sliding to 154.50 on what seemed like a Japanese FX intervention. Later this week, the Federal Reserve's policy decisions and US employment data could trigger the next big action.
Editors’ Picks
EUR/USD retreats below 1.0700 as USD rebounds
EUR/USD lost its traction and retreated slightly below 1.0700 in the American session, erasing its daily gains in the process. Following a bearish opening, the US Dollar holds its ground and limits the pair's upside ahead of the Fed policy meeting later this week.
USD/JPY recovers toward 157.00 following suspected intervention
USD/JPY recovers ground and trades above 156.50 after sliding to 154.50 on what seemed like a Japanese FX intervention. Later this week, the Federal Reserve's policy decisions and US employment data could trigger the next big action.
Gold holds steady above $2,330 to start the week
Gold fluctuates in a relatively tight channel above $2,330 on Monday. The benchmark 10-year US Treasury bond yield corrects lower and helps XAU/USD limit its losses ahead of this week's key Fed policy meeting.
Week Ahead: Bitcoin could surprise investors this week Premium
Two main macroeconomic events this week could attempt to sway the crypto markets. Bitcoin (BTC), which showed strength last week, has slipped into a short-term consolidation.
Five Fundamentals for the week: Fed fears, Nonfarm Payrolls, Middle East promise an explosive week Premium
Higher inflation is set to push Fed Chair Powell and his colleagues to a hawkish decision. Nonfarm Payrolls are set to rock markets, but the ISM Services PMI released immediately afterward could steal the show.
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