A recap of today's market movement in our trades.
It was really good day for us and both the contracts are almost 50% up from the point of our entry. At this time it will be difficult to resist the temptation and take home some profits.
My entry point was 55 and a gain of 50% minimum is what I look forward to. 50% of 55 is 27.5 and hence my first target was (55+27.5) 82.5 which was achieved today. I sold part of the position to book the profit partially. Accordingly I reduced hedge position also. This kitty already is in the bank and gives me good leverage cushion for the remaining position. I can be more aggressive with the stop-loss and wait longer for next target... correct?
No, I do not work it that way. I will, on the contrary, move my stop-loss closer to the present price so that my already booked gains are not wiped clear by remaining position. I will rather book a modest profit in the remaining position... close this trade completely and move on to next trade. Old adage is let your winning horse run and cut the losses in other cases cannot be more true.
One more thing is I would have been happy to close the trade completely today itself and have fun for the rest of the week 
. This would have been completely acceptable if our target was 50% as usually the case with me. However this target cannot be a rigid thing and you have to adjust your expectations dynamically. Looking at the events in Europe where Italy is trying hard to join the party with Greece... things can get extremely messy. Present stress in the market due to Greece would feel like a bruise against a full body fracture that Italy can induce across the world markets. Hence stayed on the short side (with hedge off course... you can never be sure). However the trend is clearly downward. Have a look.
. This would have been completely acceptable if our target was 50% as usually the case with me. However this target cannot be a rigid thing and you have to adjust your expectations dynamically. Looking at the events in Europe where Italy is trying hard to join the party with Greece... things can get extremely messy. Present stress in the market due to Greece would feel like a bruise against a full body fracture that Italy can induce across the world markets. Hence stayed on the short side (with hedge off course... you can never be sure). However the trend is clearly downward. Have a look.
As of now US Markets are down (more than 2%) in line with Europe and that bodes well for our trade. The chances of them coming back to positive territory are not very bright but respect your stops and targets. I will book full profits if 5200 PUT reaches 100 tomorrow.
Happy Trading.
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