Friday, March 27, 2015

Monitoring the Market while Your Trade Is Active

No matter which trading style you follow, it pays to keep up
with market news and price developments while your trade
is active. Unexpected news that impacts your position may
come into the market at any time. News is news; by definition,
you couldn’t have accounted for it in your trading plan, so
fresh news may require making changes to your trading plan.
When we talk about making changes to the trading plan, we’re
referring only to reducing the overall risk of the trade, by
taking profit (full or partial) or moving the stop loss in the
direction of the trade. The idea is to be fluid and dynamic in
one direction only: taking profit and reducing risk. Keep your
ultimate stop-out point where you decided it should go before
you entered the trade.

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