MANAGING A TRENDING TRADE

When you are in a trend trade, it is important to protect the money you have made on that trade. One of your daily routines should be to reevaluate where your stock is based on technical analysis, and adjust your stops accordingly. What this means is, if the stock is trending up, you want to move your stops up as the stock moves up. You may want to put it 50c to $1.00 below where the stock is, depending on how volatile the stock is. If the stock is trending down, you would do just the opposite. You may be using a 10 day or 20 day moving average. Be aware of where those moving averages are.