In practice
A target set in advance turns a hope into a plan and makes the reward to risk known before entry. Traders place targets where price is likely to pause or turn: prior highs and lows, opposing zones, or measured levels.
Many use more than one, taking part of the position at a first target and the rest at a second.
What to watch for
A target just beyond a level may never fill; place it slightly in front. Closing by hand long before the target out of nervousness cuts the average win and can ruin a profitable plan.
Related terms
3 terms- Partial profitClosing part of a position at a first target and letting the rest run.
- Risk to rewardRRThe distance to your target compared with the distance to your stop, decided before entry.
- Draw on liquidityDOLThe pool of liquidity or imbalance price is most likely heading for next, which sets your bias.