Managing a Winning Trade
                       For example, you are long 400 SHS of XYZ with  a  1/2point stop loss ($200) and it is now trading up  with  a  1/2  point  profitwhat will you do?                         1.Sell 200 SHS, lock in 1/2 point ($100) and  leavethe stop as is so the worst you will do is break even if your  stop  is  hitwhich is now 1 full point away from current price.                         2.Sell 200 SHS, lock in 1/2 point ($100)  and  movethe stop up to entry  price,  which  essentially  guarantees  you  the  $100profit if you subsequently get stopped out.                         3.Do nothing because the  dynamics  of  your  stockstill look good and market direction is still up
                       I would eliminate #1 because it is a  day  trade  andyou don’t want to give back 1/2 point profits when your average  profit  pertrade might range from 5/8 to 7/8. Also, you only  want  to  remain  in  thetrade if the market proves your trade correct so how can sit and do  nothingwhile your stock trades down a point.                       #2 is my choice because  I  have  locked  in  a  $200profit and am giving the remaining 200 shares a  chance  to  run  until  themarket that I exit the trade. Yes, you might get stopped out  by  the  firstnormal pull back, but you can always re enter the trade.                       #3 is a choice you might make if the  stock  dynamicsare very strong as the buyers are very aggressive with  no  visible  sellingpressure. You will have this decision very often on  a  strong  up  trendingday. By keeping the entire 400 shares in play you have a  good  multi  pointopportunity. You can move up a tight stop under the 1/2 point profit and  ifit runs great, if not, you have what you did in #2. If it’s  early  in  yourday you will probably take the 1/2 point sale  on  200  shares  to  get  theledger.                       In an effort to keep your losses small you  will  getstopped out often in day trading. There is lots of daily noise  due  to  S&P500 futures and program trading so you must maximize your profit per  trade.That is why your stock selection  should  consist  of  the  RS  value,  highalpha, and strong EPS stocks.  We  want  to  trade  these  stocks  in  theiradvancing stages when momentum is strongest.