Suppose there’s a person named Zheng who works the evening shift at a neighborhood parcel pickup station. He doesn’t check the market until he’s finished sorting all the packages for the night. Binance also offers tokenized stocks, so he sets himself a rule: he only buys on days when the price falls more than 15% from open to close, and he buys at the closing price, just once. He also sets fixed rules for selling: he’ll sell only when the close is at least 12% above his cost; touching that level intraday doesn’t count. He’ll stop-loss only if the close falls below the low on the day he bought; an intraday dip below it doesn’t count.
Of the 90 daily candles from August 12 to November 9, only the one on November 5 had a drop of more than 15% from open to close. That day, $AMDB opened at 486.46, reached a high of 488.09, fell to a low of 400.23, and closed at 404.30—a 16.89% drop from the open. He followed his rule and bought at 404.30. After that, he’d sell only if the close reached 452.82, and stop-loss only if the close fell below 400.23.
On November 6, it opened at 404.62 and reached a high of 460.23, which was 55.93 above his cost, or 13.83%. If touching the 12% level intraday counted, that would have been enough. But it closed at just 447.25, which was 42.95 above his cost, or 10.62%—still 1.38 percentage points short of 12%. The low was still 404.62, so it didn’t close below 400.23 either. By his rules, he didn’t sell.
On November 7, it closed at 446.94, 10.55% above his cost. On November 8, it reached a high of 452.84, 12.01% above his cost, so it had already touched the 452.82 mark. But it closed at just 448.54, up 10.94%. It hit the target intraday again, but still didn’t close above it.
On November 9, it opened at 448.54, reached a high of 515.48, fell to a low of 440.90, and closed at 514.61. The close was 110.31 above his cost, or 27.28%. His condition was met, so he sold at 514.61.
If he changed the rule from a 12% gain to selling whenever the close was more than 10% above his cost, the November 6 close of 447.25 would already have been enough, and he would have sold that day.
Have you ever had a moment when the price had already touched your take-profit level intraday, but because the close fell just short, you held on for a few more days?
Of the 90 daily candles from August 12 to November 9, only the one on November 5 had a drop of more than 15% from open to close. That day, $AMDB opened at 486.46, reached a high of 488.09, fell to a low of 400.23, and closed at 404.30—a 16.89% drop from the open. He followed his rule and bought at 404.30. After that, he’d sell only if the close reached 452.82, and stop-loss only if the close fell below 400.23.
On November 6, it opened at 404.62 and reached a high of 460.23, which was 55.93 above his cost, or 13.83%. If touching the 12% level intraday counted, that would have been enough. But it closed at just 447.25, which was 42.95 above his cost, or 10.62%—still 1.38 percentage points short of 12%. The low was still 404.62, so it didn’t close below 400.23 either. By his rules, he didn’t sell.
On November 7, it closed at 446.94, 10.55% above his cost. On November 8, it reached a high of 452.84, 12.01% above his cost, so it had already touched the 452.82 mark. But it closed at just 448.54, up 10.94%. It hit the target intraday again, but still didn’t close above it.
On November 9, it opened at 448.54, reached a high of 515.48, fell to a low of 440.90, and closed at 514.61. The close was 110.31 above his cost, or 27.28%. His condition was met, so he sold at 514.61.
If he changed the rule from a 12% gain to selling whenever the close was more than 10% above his cost, the November 6 close of 447.25 would already have been enough, and he would have sold that day.
Have you ever had a moment when the price had already touched your take-profit level intraday, but because the close fell just short, you held on for a few more days?