The Tradesy, my Holy Grail of entry systems in StocksBacktesting my 50% retracement system for Apple stock is a perfect example of how it works.
Drawing my bespoke fib levels from the previous low to the new high gives me my entry point, stop and initial target.
ENTRY 50%
STOP 25%
TP1 100%
Closing (selling) 50% of the initial position at TP1 allows the remaining 50% of the position to be risk free.
There are two methods to manage the trade beyond the initial target:-
Scaling out (conservative) = Closing 50% of the remaining position at each TP.
TP2 (4R)
TP3 (8R)
TP4 (16R)
TP5 (32R)
etc,etc.
Balls deep (aggressive) = Moving the stop to the previous entry price as each new TP is hit, accumulating a large risk free position which will eventually close out as structure breaks down.
