Maybe I mentioned this before, but I'm planning to post all my trades during February. I won't be doing them in real time, so I'm afraid you'll have to take it or leave it. You'll probably see me breaking a lot of my own rules, but hopefully you should see me post a profit nevertheless.
As I stated at the start, I would never be interested in selling or teaching or anything of that kind. Therefore anyone that wants to see statements or live calls to validate my results is politely requested to direct their enquiries to the Lick My Sack Department.
I took this one today (first of the month). Nothing particularly special or terrible about it according to my criteria. I ended up being taken out at break even.
It's certainly not a textbook trade, but I've shown my stop reductions (ending at the top line which is break even) to show how I attempt to reduce risk in logical stages. When it approached the prior high (which is of course a pretty serious high) I set it to break even.
This is because I was not willing to take a serious loss on this trade. When it hit those previous highs, it had done all that I could reasonably expect. If you want to trade like this, you cannot afford to be surprised when price turns round on you. 9 times out of 10 there is an obvious explanation on your chart and you must do something - close, reduce risk, go to break even, or whatever. You cannot sit with your stop at the bottom and your thumb up your a$$ grumbling about how your broker is screwing you, or whatever other excuses you like to come up with.
Had this been a stronger set up with a better story behind it I would be willing to hold and willing to take a loss. But playing loose with this type of set up will bleed all your profits out and at best you'll be stuck at break even.
A big part of my progress was being willing to reduce risk, even if it meant taking a loss I could otherwise have avoided. It's annoying when it nicks your reduced stop and then turns to go on a make a fortune, but those times are worth it to reduce your average losses (at least, this applies to me and the trades I take). In all honesty it rarely happens - normally when it's turned bad by say 60% of the original stop distance, it's going the whole way.
Going back to Livermore / Lefevre:
Keep what shows you a profit, sell what shows you a loss.
Hope that market will continue to go in your favour, fear that it will continue to go against you.
(I'm paraphrasing, I can't be bothered to look up the quotes)
To put it another way, cut your losers and let your winners run.
