Buy Signals Sell Signals: Strategic Stock Market Entries and Exits pdfdrive com

Price targets are for maximum profits on the exit
Price targets should be set at levels where your risk/reward ratio has skewed
against your trade and the odds of a reversal from an extended price level is
greater than the odds of it going in your favor. Price targets can be set at key
round price levels at overbought/oversold oscillator levels like the 70 RSI to exit
longs, the 30 RSI to exit shorts, rallies back to key price support or resistance
levels, or to key moving averages.
Trailing stops allow your profits to run as far as they will go
A trailing stop is when you allow your stop loss to stay close as your trade
becomes a winner. A short-term moving average is one way to do this. If your
trade reverses back under the 5-day EMA or 10-day SMA you would stop out. A
strong trend could use the 5-day EMA and a trade with a wider price rang could
use the 10-day SMA. I like to use a close below a key moving average for my
trailing stops so price confirms at the close, and I am not stopped prematurely
intra-day due to noise. You should be very careful with position size based on
volatility to be able to hold to the close. Another trailing stop could be a loss of
the previous day’s low for long positions, or the break above the previous day’s
high for short positions. These can be intra-day or end of day depending on your
time frame.

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ATR stops get you out of a trade after a few bad days.
The ATR% stop method can be used for any type of trade because the width of
the stop is determined by the percentage of average true range (ATR). ATR is a
measure of volatility over a specified period of time. Normally a high ATR
indicates a volatile market, while a low ATR indicates a less volatile market. By
using a certain percentage of ATR, you ensure that your stop is dynamic and
moves with market conditions. Widen your stop in more volatile times and lower
it in less volatile markets to keep from being stopped out too soon and to account
for noise in price movement.