Whenever I enter a swing idea and the stock blasts higher and exceeds +10% on an intraday basis I automatically close out 1/4 to 1/3 of the position into strength. No questions asked! Depending on the average true range of a stock and/or closeby major PLL levels, this threshold could vary. Origin of the rule was a tweak to avoid that gains in swing trades entered via quiet & tight setups vanish one day after a one bar wonder and to secure or lock-in the setup specific R-multiple in general. Subsequent trigger events call for reduced scale-outs.

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Disclaimer: This article is my opinion which stems from my own experience gathered trading real money in the stock market. It represents my style and it fits my personality and risk allowance. More power to you if you are a net profitable trader despite violating everything that’s written above!

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