Ultra-Conservative Approach to Trading

May 23, 2006 by Trader Rich 

I don't know if it is possible but the last couple of weeks I've been taking the ultra-conservative approach with tight stops and non-greedy limits.  It seems to be working for me so far but I have to be careful not to suddenly change my method and set a wider stop because doing so can easily wipe out all of my tiny gains. 

I'm actually very proud of a trade I had this morning because even though the USD was strongly pushing upwards against the CAD, I took my 25 pips that I set out to take when I opened the trade.  The proud feeling was when I saw the price immediately turn back down.  This brings me to my main point, should I be patient and let my profits run or take a small profit.  Over the last couple of weeks, I've seen some huge days especially with the Sterling where if I was patient, the gains could have been 100+ and even 200+ pip profits.  But if this market is trending only 20% of the time or less, am I doing the right thing by taking a profit one-fifth or one-tenth of the potential profit.  I really don't know the answer to this.  I'd also like to know if any of you think that a 60 pip profit target for a week is "weak."

I have to say that the more I think about my 60 p. profit target for the week, the more I like it.  Why? Because it fits my personality.  I have a hard time sitting around for days, even hours, while the price moves ever closer to stopping me out or eating into my profits.  I've also found that even when I think I'm trading the daily charts, I'm really not because I'm entering on the daily chart and exiting on either a 15 minute chart or strictly on discretion.  So what I'm getting at is for now, I'm sticking to the small time frames and depending on my progress may keep it that way at least for a while.

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Comments

One Response to “Ultra-Conservative Approach to Trading”

  1. Patahul Ariffin Abas on December 29th, 2006 8:29 pm

    TARGET? LET THE PROFIT RUN!!! safe guard your profiit with stops.

    BIG MOVERS are the BANKS All the spikes are created by them! Follow their leads you’ll make big

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