A simple way to take profits in spot trading is to use a tiered exit strategy:
1. Set a Profit Target: Decide in advance at what price level you will sell. For example, you might aim for a 10% or 20% gain.
2. Sell in Portions: Instead of selling all at once, sell in increments as the price rises. For example:
• Sell 25% of your position when you reach your first target.
• Sell another 25% if the price moves higher to your next target.
• Keep the remaining portion to ride any further price increase or set a trailing stop-loss to lock in gains.
3. Stick to Your Plan: Avoid letting emotions like greed or fear influence your decisions.
This approach helps lock in profits while allowing you to benefit from further upside.