... and I'll call it a day

So I've started getting to a point where I'm having consistent green days now (trading FX) and I began thinking about when to stop trading on any particular day. I'm sure there are millions of ways to assess when you should switch the screens off, and I'm pretty interested to hear some of your targets or otherwise for 'calling it a day' and stopping your trading.

I used to toy with a daily pip target which, once met, would signal enough was enough. But now I'm looking at all sorts of other metrics, e.g. account value percentage increase, a win:loss ratio given a minimum number of trades, etc etc.

On the other hand I think, if it's a good day and everything's going well, why bother stopping? But a defined 'target' is definitely something that I'm trying to incorporate into my overall strategy and discipline now.

What t/f are you trading?

I trade 4hr, daily and weekly so generally look at the charts 7am, 11am, 3pm, 7pm and 11pm each day and just trade what I see. Don't think I would ever set any daily/ weekly targets, would prefer to just take whatever is on offer.

Use your research and backtesting to identify the optimum times to trade.

Decide on set hours that integrate these periods satisfactorily with your social life and commitments.

Then form a set of rules and stick to them.

I need to learn when its a good idea to stop, too often i have a great start...

Then have a few losses, get brave trying to regain them and lose my winnings + more.

Something someone said to me a couple of years ago - 'When you're hot, you're hot and when you're not, you're not'.

Knock it on the head if it isn't working out and preserve your capital. Tomorrow is another day.

I think daily targets are a bit daft in terms of slacking once you hit the target... generally if you're doing well I would suggest continuing trading until market closes.... conversely if nothing and you're below target, then stop ffs...

agreed with arabian and robster,

if you're making money then continue until the market closes. You could make your whole months p/l on one good day. No point stopping if you are up a certain arbitrary number.

arabianights said:

I think daily targets are a bit daft in terms of slacking once you hit the target... generally if you're doing well I would suggest continuing trading until market closes.... conversely if nothing and you're below target, then stop ffs...

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Mostly agree with this, but a slight different opinion with regards to "generally if you're doing well I would suggest continuing trading until market closes"

If you're doing well on a particular day, then it could be advisable to stop. If you have a number of profitable trades in succession (without a loser), then the probability of the next trade being a loser gets higher and higher. Of course, you can keep your losers small, but you are more likely to give back some of your profits the more you keep trading on your good days.

Today I had three profitable trades consecutively and met my daily target minimum. I will likely stop now and just preserve what I've got.

So perhaps it could be wise to have a target and completely restrict yourself from trading when a target has been met.

On the other hand, stopping because of targets is unprofessional.

It's a tough decision.

sk1105 said:

So I've started getting to a point where I'm having consistent green days now (trading FX) and I began thinking about when to stop trading on any particular day. I'm sure there are millions of ways to assess when you should switch the screens off, and I'm pretty interested to hear some of your targets or otherwise for 'calling it a day' and stopping your trading.

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A few ideas:

1.Take all valid setups as per trading plan until end of your trading day, regardless of today's P/L status.
2.Stop trading after profit target is hit. Ideally this target will equal to greater than you biggest ever expected losing day.
3.Have a trailing stop on your daily P/L, if you give back 20% of the days profits stop trading.
4.Once profit target is hit, continue to take trades but only the ultra best looking ones (assuming you are a discretionary trader).

I use #1 but i am automated.

dmt257 said:

What t/f are you trading?

I trade 4hr, daily and weekly so generally look at the charts 7am, 11am, 3pm, 7pm and 11pm each day and just trade what I see. Don't think I would ever set any daily/ weekly targets, would prefer to just take whatever is on offer.

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this.
you can't know whether each trade will be a winner or loser so you have to go with the equity curve. I sometimes take a Friday off if all was well the first few days and I have an unofficial monthly target but if I hit that with 2 weeks to go, I just keep trading. You might make a load one month and nothing or a loss the next so stopping at the target cuts you short during good times.

Interesting feedback, thanks. For the record, I trade outrights and fully discretionary. No coding or system mumbo jumbo for me!

I'm somewhat confused at the notion that it's "unprofessional" to stop trading after reaching a predetermined profit target. I've had days where I've started out amazingly, only to give back significant chunks of those successes later on in the day. It's what got me thinking about profit targets in the first place, and the reason for this thread really.

There is nothing to say that, as an integral part of your trading plan/strategy you have a target included. i.e. strategy is x if y then z, up until you have reached T number of pips for the whole session. The strategy may well still throw up ample opportunities after the target has been reached, but by calling it a day you have guaranteed you won't lose those winnings. Yes, you also limit yourself to those winnings alone but (depending on what target you set) surely that's far better than the risk of giving some of it back.

Today I hit a profit target by about noon and, instead of switching the screen off altogether, decided I'd just reduce my size for future trades for the rest of the day. Another possibility I guess?

Really that's the point of this thread. Just wanted to see if any of you did use targets to either stop altogether or just chill out a bit, and get some ideas for "target strategies" if you will. I'm sure many of you will use (or have used) downside limits? i.e. after losing X pips in a session, stop or have a break. Why not also have one for the other way round?

Appreciate the input so far.

I don't have an upside target.

I do have a downside bail target though and that's if I take 2 back to back losses out of the blocks, I call it a day. There is a reason for this though as it's telling me something about the market state being untradeable for how I trade (i.e. there is no predominant directional bias established on my TF). Hence I stay out until it decides where it's going and then invokes another valid set-up. For me that's usually not during the same trading session.

The point I'm making is that set-up validity and market state is determining whether I participate.

well really this is one of the things that seperates trading "in theory"to trading "in practice".

Yeah, there is the whole thing like "make hay while the sunshines" and so if you have a +ve expectancy then keep trading if your up and stop if you're down. BUT "you can't hit a target you can't see", so profit targets / loss limits are important parts of a strategy IMO.

the way i went was to have a target / loss limit / trade limit and kept on going until I got to it. Often I would get to it pretty early on, and from then I switched to the simulator and kept on trading my strategy. Sometimes I missed out on great profits but not as much as I would have given back money Id already made - most people have probably experienced this in there careers. You just get cocky.

Anyway then I would try to do the same thing again, trade (on the sim) until i hit one of my limits. And then wipe the slate clean and try again, rinse and repeat innit.

i would compare the first "session' of real results to the next session of "sim" results. When they were looking the same on average (and obv profits) I would do 2 "sessions" of proper trading and then go back to SIM until end of trading; when the first sim "session" (i.e. 3rd time I hit one of the limits) was, on average, same as the others, I made it "proper" session, and so on and so on.

yeah of course everyone would always like to trade exactly the same whatever their p and l but it just aint that easy. imo the trick is to have targets/limits, and have them big enough for you to ride out a few bad trades, but tight enough to catch you when your on tilt. Then start all over.

(one other thing, you should try having fixed TIME limits on your trading 0 like 9am - 3pm or whatever. overlooked by alot of people, and look if your flat after 10 hours, go home!)

If you're up you keep trading that way you can lose the money and have something to moan about later on.

If you're down on the day keep going to make it back. I'm not in the market for short term loans.

sk1105 said:

I

I'm somewhat confused at the notion that it's "unprofessional" to stop trading after reaching a predetermined profit target. I've had days where I've started out amazingly, only to give back significant chunks of those successes later on in the day. It's what got me thinking about profit targets in the first place, and the reason for this thread really.

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It's not unprofessional but mathematically and theoretically it is incorrect.
Psychologically it could be correct for your system, it just depends.
I trade a system of around 1::3RR and it would say it is is barely better than 50:50 and I never know exactly at what time the next trade will be (an average of 1 a day) so I take the trade whenever the opportunity comes up.
If you are a scalper/day trader type then a daily target could be useful.

If you have an edge, keep trading through both winning and losing periods. Refine your system to increase the edge, but never stop.

If you're basing profitability on luck (or unknown factors), quit as soon as you're £1 ahead.

I find it best to decide which times of day genrally provide the best tarding oppertunitys and what times of day you are free to trade and work it round that.

I mainly trade the ftse and dow and find the best times are 8.30-10.30 15.00-16.00 and 19.30-21.00