Posted on March 25th, 2008 at 10:17 AM
One of the most difficult things to master in trading is how to effectively trail a stop on a winning position. Ask three different traders about how to trail a stop and you'll likely receive three different answers. The way I see it, the key to letting winning positions run is to have several methods available in your trading arsenal. One of my favorite types of trailing stops is the use of the regression trend channel. This is an example of the Stochastic Sell that popped up in the daily chart of EXPE a few days back.
It should be noted that an effective trailing stop needs to be accompanied with a sound money management plan.
~Duane Gott
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