BABA's Big Break


BABA finally broke 300 this morning.

And Trade Unafraid bowled a perfect game.

See what I did there?  😄

BABA reached 299.00 on September 2nd, followed by a long, meandering drop below 265.  It formed a sort of a cup and handle over that time.  Today, it clearly wanted to break 300, and I wanted to be there when it did.

At 10:25am, I set up a Trade Plan to enter on a Break of 299.36, which was the high of the prior 15-minute candle.  Even though I wouldn't usually play the break of a round number from quite so far away, we had full time-frame continuity to the upside, an inside 5-minute bar, and price at the high of the day.

These were my Trade Unafraid exits.

It takes a little getting used to, but what this says is to take a 10-cent profit on 40% of the position, take a 20-cent profit on 20% of the position, and that's all.  I could have set a trailing stop on some other percentage of the position, but I chose not to.

(As I've said, we intend to do some major work on the user interface, but the backend trading system is our top priority at the moment.)

I opted instead to use a 1-minute candle trail as the exit on the entire position.  So, win or lose, if price ever dipped below the low of the prior 1-minute candle, I would have been out of whatever position remained.

Since my entry was very close to an inside candle, the bottom of that candle would have been my stop loss during the first minute.  I was okay with that risk.  There was also a $500 total loss tactic applied.  Whichever exit hit first, I would have been out.

So I set this up and literally stopped watching it.  I was doing some other work and realized that I was in a trade.  Within seconds, my two profit targets were filled.  I went back to work, leaving Trade Unafraid to manage the remaining 40%.  
Even if BABA collapsed, my Preserve Profit exit would make sure that my winning trade did not become a losing trade.  But after the first minute, the candle trail would get me out before it was even possible for this trade to go from green to red.  The candle trail is indeed how I exited the remaining 40% of the position.

The final result was a profit of $251.  Precision trading, emotion-free.