tm_speedstyle371 wrote a post · Sep 29, 2024 19:27

Immediate stop loss in swing trading (short-term) enhances trading ability! ❗️

In swing trading, stocks purchased do not always rise, sometimes they fall. At that time, please cut losses immediately. There are two intentions, for example...

1️⃣ If purchased at $10 ➡️ drops to $9, immediately cut losses (P/L -1)

2️⃣ Drops to $7, then reverses and bought at $8 ➡️ rises to $10 (P/L +2)

3️⃣ Further decline without cutting losses (P/L -??)

With target 1, even if you incur losses and cut them, you can recover with a V-shaped reversal. Therefore, return to neutral once.

〈Intention 2〉Prevent being stuck in a further decline to protect assets. Being stuck lowers investment efficiency during that prolonged period.

When swing trading, taking losses is natural and not scary. In fact, it is necessary to take losses in order to win. Isn't this mindset the same in medium-term investments? Especially with stagnant stocks, one only holds them when there is a prospect of a V-shaped recovery in the near future.

Stocks will increase trading skills based on experience of buying and selling. Sometimes, it's better to acquire skills for the future even if there is a loss. Beginners 🌱, please take note.

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