Active Trade Management for most people simply involves trailing of the stop loss order, first to breakeven and then behind significant price features as the market moves on its path towards the target.

However there are other options available for those who wish to explore further.

It can also involve scaling in and out of trade parts; adding risk or removing risk in response to your perception of ongoing trade potential.

There are MANY ways that this can be achieved. The following shows one simple option, in which risk is reduced at intermediate levels of short-term S/R and added again only if price breaks that level.

advanced trade management

advanced trade management

advanced trade management

advanced trade management

advanced trade management

advanced trade management

advanced trade management

advanced trade management

As always though… a little disclaimer… this is not the only way to trade. Your stats and your personality will determine whether you're better off using a passive trade management approach, a simple trailing stop, or some form of more advanced trade management method as shown here. So trial all options. And keep good stats! That's the only way to find the right fit for your personality and trading style.


Happy trading,

Lance Beggs

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  1. Lance, I’m sure you’re aware of all the HFT news lately. Since you are on small timeframes you could do an article on how or whether that impacts your method i.e. fast movement making you miss trades, how you filter out noise, etc etc

    1. Markets are not, and have never been, static. The participants change. Volatility changes. The regulatory framework changes. And all changes will influence to some degree the way in which price moves within that market. The increase in the number of algos is just one of the recent changes.

      It’s our job as traders to adapt to the changing environment.

      HFT’s are just one of the latest changes.

      Adapt and learn to work with them.

      A relevant quote from Mike Bellafiore’s “The PlayBook” – “Do not get lost in an endless opportunity to find conspiracies in the marketplace.”

      Look at a price chart for a whole session… and consider this…

      The HFT’s are already in there.

      Did the chart offer price swings that are sufficient to profit?

      If so, then the presence of HFT’s has not destroyed all opportunity. Ignore all the fear that’s being spread in the mainstream media. And learn to target the opportunity that is still available in the markets.

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