Entry and Exit Strategies
Your entry and exit determine whether you make profit or loss. Even with the best strategy, a poor entry or exit can wipe out your profit.
Entry Strategies
1. Pullback Entry
In an uptrend, you wait for a pullback to support. When price forms a bullish reversal pattern there, you enter.
2. Breakout Entry
You wait for price to break through an important level. You enter as soon as the candle closes above the level.
3. Retest Entry
After a breakout, you wait for the retest. When price returns to the breakout level and holds it, you enter.
4. Reversal Entry
You look for patterns that indicate a trend reversal.
Exit Strategies
1. Fixed Target
You set a profit target in advance, for example, 2x your risk.
2. Trailing Stop
You use a trailing stop that moves with the price.
3. Support/Resistance Exit
You take profit at the next important support or resistance level.
4. Time-Based Exit
If price does not reach your target within a certain time, you close your position.
Entry and Exit Combinations
Conservative
- Entry: Retest after breakout
- Exit: Fixed target + trailing stop
Aggressive
- Entry: Breakout
- Exit: Trailing stop
Trend Following
- Entry: Pullback in trend
- Exit: Structure-based trailing stop
Common Mistakes
- No clear entry plan
- No clear exit plan
- Emotional entries
- Taking profit too early
- Taking loss too late
Tips
- Determine your entry and exit BEFORE you open a trade
- Write them in your trading plan
- Follow them strictly
- Analyze afterward if your plan worked
Conclusion
Your entry and exit are the two most important decisions in every trade. A well-thought-out plan for both is essential for success.
