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wolffj

What is / how should I use T1 and T2 to exit my trade?

Trade recommendations often times include profit targets T1and T2. I am new to FOREX trading and would like to know what these profit targets mean. Do most traders exit 50% of their position at T1 and the other at T2? Or exit all at T1 if I want a lower risk/reward? T2 if I am willing to accept a higher risk/reward ration?
Thank you.

over 4 years ago

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Cyclopip

What many traders do is that they close half their position at T1, then move their stop loss to their initial entry point to create essentially a risk free trade and wait to see if their 2nd position gets hit. I personally do this for my trades. What others do is that they close a higher percentage (maybe 2/3 or 3/4 of their position) at the first TP to ensure a bigger profit, depending on how the markets are playing out. Keep in mind that for most traders, they make sure that their 1st profit target is at least equal to their stop loss. This is to keep a reward to risk ratio that at the very least is 1:1.

over 4 years ago

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ForexAndLifedotcom

T1 & T2 are usually profits targets whereby T1 is the nearer profit target and T2 is the further one.

In trading, there is an old saying that goes, "Cut your losses short and let your profits run". Using T1 and T2 is one of the methods to "let your profits run".

Example:

Recommendation:
BUY 1 lot Eur/Usd @ 1.5000
T1 = 1.5050
T2 = 1.5100

You bought 1 lot at 1.5000. Once price reaches T1, you take PARTIAL profit on your position and let the remainder run to see if it reaches 1.5100.

Whether your PARTIAL profit is 25%,50%,75% or whatever % mainly depends on what is "recommended" by your signal provider and also your risk appetite.

Most of the time, the signal provider will also recommend that you move your stops to breakeven i.e. your entry price OR move your stop to some predefined level.

To best decide on how much PARTIAL profit should be taken as well as moving stops and managing your positions, it is advisable to talk to your signal provider as he will probably know his system best IF he is a genuine and reliable provider.

Hope this helps,
Leo @ http://ForexAndLife.com

over 4 years ago

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NotSure

Question, how u can take Partial profit if it's only one lot u opened? Or u ment for example to gain 50 bucks, but instead u will take half less-25 and close the deal
And after u will open another position and u will set take profit for another 25 bucks and put stop loss closer to the point where u collect ur first profit?
For example
Buy 10000 eur/$ for 1.3000 take profit at 1.3025
Set another position for buy 10000eur/$ for 1.3025 take profit for 1.3050 and stop loss at about 1.3000????
Correct me please, I don't really understand

about 1 year ago

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HappyPip

You can make use of T1 and T2 when you're doing a range trade but also expecting a breakout. For instance, if you notice that the EURUSD has been trading between 1.4150 and 1.4100, you can short at 1.4150 and set T1 at 1.4100. You can set another profit target (T2) much further if you expect the pair to break below 1.4100 and continue to drop, say, until 1.4000. Like Cyclopip mentioned, your losses could be minimized if you move your stop to your entry point after closing part of your position at T1.

over 4 years ago

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