In my decade-long journey in the trading world, Take Profit (TP) orders have been my go-to tool. But like any tool, if not wielded correctly, it can do more harm than good. I've made my share of mistakes, and through them, I've learned the importance of setting and adjusting TP orders correctly.
In my early days, I'd frequently set my TP levels too close to the entry point. It was out of fear, honestly. But time and again, I saw the market surpass my premature TP points, leaving potential profits on the table. It taught me to be patient and give my trades room to breathe.
During a particularly bullish market phase, I once set a TP without considering the looming resistance level. And as expected, the price stalled right before my TP. By skipping technical analysis, I was essentially trading blind. Now, I swear by my technical indicators—they've saved me from many potential pitfalls.
I remember setting a TP at $100 for a stock, thinking it was a solid target. But as it reached $99.80, it retraced. This happened more than once, making me realize the psychological game behind round numbers. They might look appealing, but the market dynamics around them can be tricky.
2018 was a volatile year. News events shook the markets repeatedly. I had set a TP on a forex pair, but due to sudden geopolitical news, the market dynamics changed. Had I reviewed my TP in light of the news, I would've saved myself from a missed opportunity.
I've dreamt of 20% returns within weeks, setting my TP accordingly. But markets don't care about our desires. They move on actual events and data. It was a hard pill to swallow, but I've learned to set TP based on market conditions, not personal wishes.
I once missed an earnings report of a company I had invested in. My TP was hit prematurely because of the price surge post the report. Ignoring fundamental analysis was akin to trading with one eye closed. Today, my trading strategies always blend both technicals and fundamentals.
Switching strategies frequently led me to a confusing phase in my trading career. While it's crucial to adapt, a core underlying strategy acts as a compass, especially in turbulent market times.
I learned this the hard way. After what I thought was a profitable month, broker fees ate into my profits significantly. Since then, every TP I set factors in all associated costs.
My experiences, both good and bad, have shaped my trading style. And while I still learn every day, I hope my journey can shed some light on the intricate art of setting Take Profit orders. As traders, our aim should be continuous growth, adapting from our mistakes, and sharing our knowledge with the community.
About Nadav Zelver
