Scaling-in
There are times when I will scale into a position.
When the price dips into the black EMA pullback zone, I'll typically get 25% of my position there.
I'll then add a full position if the price dips past the black EMA
Don't add to winners
I don't advise adding to winners
I only advise adding to losers IF it's part of your plan.
You should always have a stop in place and get out at your stop (or preferably use our hard exit system)
NEVER add to your position after your stop has been hit
That's not what I'm advising
I always make sure to get in a very small position early in case I miss the real entry.
It allows me to still have a decent entry if the price drops lower AND allows me to catch the move if the price decides to rip
Alright, let's talk about exits👇
Scaling-out
Your exit strategy will ultimately depend on your overall strategy
However, for ALL small accounts, I'd recommend NOT to scale
Scaling exits should really only be for accounts that can afford to take multiple contracts (5-10+)
Otherwise, it's better off just take 100% off at your first target
If you do have a larger account, here's how I'd recommend setting up your exit strategy
IMO, it's best to only have 3 targets/exits MAX.
After 3, there's really no need to complicate your trading anymore
I advise taking MAJORITY of your profits out at first target...
70-80% of your position
I like moving my stop to breakeven after I've taken my first partial
After you've taken your first partial, that's when you can leave 20-30% for runners.
You can either take the remaining runners out at your second target
or
Take half out at your second target and leave 10-15% for your last target
The larger your account size, the more targets I recommend you have
I also like moving my stops up after each target to make sure the trade doesn't go red
Why do I use this scaling strategy?
By taking the majority of my size off at my first target, it allows my strategy to keep a decent R/R rate, assuming I move stops to breakeven
It also leaves my trading more stress-free
since I have less of a position on.
Allows for the trade to come back breakeven and I've already taken most off
On top of that, I have 20-30% of my position as runners in case this stock starts to explode
Doesn't happen often, but sometimes the remaining 20% ends up netting me more profit than the original 80% did.
At the end of the day, it's up to you how you want to scale
These are the methods I found most effective, depending on your account size and your strategy