This is an age old question and always a very difficult one to answer in regards to trailing stops. Because the answer is…wait for it….”it depends.”
Don’t you just love those answers? Hedging both sides? But in reality it really does depend on the scenario. First, I want to make the case for using trailing stops in your trading. Here’s our trading with the Heating Oil Futures for the first three days of this week:
Over $3,000 in profits with trailing stops right? The reason is we have had two home run breakouts already this week – remember this is trading just a single contract.
Here’s the exact same trade set-ups but going for a fixed profit target – a fixed profit target that has proven itself to be quite reliable for us…