Stop-loss first, take-profit later—is this trade a gain or a loss?
Suppose you buy 1 unit for 100 USDT, plan to set a stop-loss at 98 and a take-profit at 106, and indeed sell the entire position at 98. The price then rises to 106.
The trade still lost 2 USDT, not counting trading fees. The subsequent price rise can help you review your entry and exit criteria, but it cannot rewrite the loss that already occurred. A single rebound also isn’t enough to prove that your stop-loss was set incorrectly.
I prefer to record three things separately: the expected direction, whether the original plan was followed, and the actual net profit or loss. We can debate the judgment, but we can’t revise executed trades after the fact.
What evidence do you usually use to decide whether a stop-loss was normal or whether the trading plan needs adjusting?
——Lin Yi’s Road to Freedom · Lin Yi Freedom Community
Suppose you buy 1 unit for 100 USDT, plan to set a stop-loss at 98 and a take-profit at 106, and indeed sell the entire position at 98. The price then rises to 106.
The trade still lost 2 USDT, not counting trading fees. The subsequent price rise can help you review your entry and exit criteria, but it cannot rewrite the loss that already occurred. A single rebound also isn’t enough to prove that your stop-loss was set incorrectly.
I prefer to record three things separately: the expected direction, whether the original plan was followed, and the actual net profit or loss. We can debate the judgment, but we can’t revise executed trades after the fact.
What evidence do you usually use to decide whether a stop-loss was normal or whether the trading plan needs adjusting?
——Lin Yi’s Road to Freedom · Lin Yi Freedom Community