The safest strategy is to exit after a failed breakout or breakdown, taking the profit or loss, and re-entering if the price exceeds the high of the breakout or low of the breakdown. The re-entry makes sense because the recovery indicates that the failure has been overcome and that the underlying trend can resume.
When should I close a forex trade?
To close a position, you need to trade in the opposite direction to when you opened it. For instance, if you take a long position on a stock, you would have to sell an equal amount of stock to close your position. Once a position is closed, it cannot be reopened.
How do you exit a winning trade?
How to Exit a Trade. There are only two ways you can get out of a trade: by taking a loss or by making a gain. When talking about exit strategies, we use the terms take-profit and stop-loss orders to refer to the kind of exit being made. Sometimes these terms are abbreviated as "T/P" and "S/L" by traders.