Chapter 16
Closing the Position and Evaluating Your Results
In This Chapter
Closing out trades to maximize results
Taking profits and stopping losses
Exiting trades at the right time and price
Looking at your trading results to improve performance
Deciding how and when to exit, or close out, an open currency position is obviously one of the last steps in any currency strategy, but it’s also one of the most important. In my trading experience, no other part of a trading strategy has the potential to stir up greater feelings of self-recrimination by traders.
The classic trader’s lament is “coulda, woulda, shoulda.” And at no time is that sentiment more palpable than after a trade is closed out because that’s when the profit or loss has been registered and you’re looking at real money made or lost.
Coulda, woulda, shoulda refers to actions you may have taken in the market, but for some reason didn’t. In the context of exiting a position, it captures after-the-fact thoughts like “I could’ve taken profit when it was testing x level,” “I would’ve cut my losses sooner if I’d known it was ...
