Three exit methods and choices in foreign exchange trading

[JRFX Forex player]

In foreign exchange trading, one of the key links that determines the outcome of a transaction is exit. How to effectively manage the exit timing of profitable orders has become an important issue that traders need to face. You can also share your exit experience.

The following are three exit methods I have summarized:

1. Fixed stop loss exit method

This method is to set a fixed stop loss point, and close the position immediately when the market price hits the stop loss point. The advantage of doing so is that it can stop losses in time and avoid further losses. However, it also means that you may exit too early in market fluctuations and miss out on subsequent possible profit opportunities. This method is suitable for traders who pursue high winning rates and smaller losses.

2. Partial profit protection exit method

Under this strategy, after making a certain profit, traders adjust the stop loss point to near the cost line to ensure that they can at least protect their principal or make a small profit. This method is more flexible than fixed stop loss, and can capture longer trends to a certain extent, while also reducing the possibility of losses. It is suitable for traders who have a certain degree of judgment and patience in the market.

3. Profit-running exit method

Profit-running means retaining positions to pursue higher profits when the market trend is favorable. Traders can adopt a strategy of gradually increasing the take-profit point to maximize profits when the market continues to move in a favorable direction. This method has a higher winning rate, but it is necessary to endure some profit-taking that may be caused by market fluctuations. It is suitable for traders who can wait patiently and can track market trends.

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[Polakandil]

I trade at FXOpen mostly using stop loss and profit target strategies because they are not always in front of the screen, but when I am focused in front of the screen, I like to modify the stop loss to lock in profits when I get floating profits. Meanwhile, for exit points, pay attention to price behavior as reflected in candlestick patterns and price reactions.

 

[mecbelly11]

I do a lot of momentum scalp trades myself. Entry can be a bit tricky, usually some indicator + price action. As for exit, sometimes I'll just do a straight +1.5%/-1% (or +3%/-2% depending on the stock) as my TP & SL points. SL can be trailing if the stock price isn't too jittery/volatile.

Kodi​

 

[Polakandil]

Using a trailing stop is quite effective for scalping, which can maximize profits when prices rally strongly. Using the MT4 trailing stop feature must be turned on because it will only work if the MT4 platform is connected to the broker's server.

 

[Fin_Trader]

Using a trailing stop is quite effective for scalping, which can maximize profits when prices rally strongly. Using the MT4 trailing stop feature must be turned on because it will only work if the MT4 platform is connected to the broker's server.

trailing stop is best used on a strong trend, because if you use it in a flat, you can lose part of your profit.

 

[Polakandil]

trailing stop is best used on a strong trend, because if you use it in a flat, you can lose part of your profit.

Yes, that's right, in a flat market using a trailing stop is easier to hit due to short-term volatility, traders also need to identify the possibility of a strong or weak trend to take advantage of this feature.

 

[kplFX]

Thank you to the author of this post for sharing. The information provided is very helpful in gaining a deeper understanding of forex strategies.