Proven Take-Profit Strategies Every Trader Needs to Know (Before the Market Reverses)

Hi everyone!

First, thank you for filling out the surveys I’ve been adding to my blogs!
Based on your responses, many of you expressed a need for a blog on profit-taking strategies. The most common challenges mentioned were:

• Deciding when to exit for profit

• Minimizing losses during downturns

• Identifying market reversals

To address these concerns, I’ll be diving deeper into these topics and sharing my approach to help you refine your strategies.

Your feedback is extremely valuable, so please continue filling out the surveys—your input helps me improve this newsletter to better meet your needs!

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Mastering the Art of Taking Profits in Trading

One of the toughest challenges traders face is knowing when to take profits.

Hold too long, and gains can disappear as the market reverses. Exit too early, and you leave money on the table.

So, how do you strike the right balance?

Let me begin by saying that taking profits is not a fixed rule—it varies from person to person based on individual risk appetite and tolerance. What works for one trader may not necessarily work for another.

My goal is to share the strategies that have worked for me, but it's important to recognize that many successful traders use different approaches.

The key is to trade with a clear strategy rather than relying on emotions. Whether you’re selling at resistance levels, using Fibonacci extensions, or scaling out of positions, a structured approach helps you secure profits while staying in the game for bigger wins.

Let’s dive into the essential strategies for taking profits effectively.

Why Taking Profits Matters

Trading is about risk management. If you don’t take profits strategically, you could end up holding a losing position or missing out on potential gains. As the saying goes:

"You’ll never go broke taking profits."

Taking profits ensures:

✅ You lock in gains before the market reverses.
✅ You reduce risk exposure in volatile markets.
✅ You improve decision-making by relieving emotional pressure.

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Selling at Resistance Levels

One of the best ways to take profits is by selling at resistance levels—areas where the price has previously struggled to break through.

How to Identify Resistance Levels in Advance

📍 Historical Price Action – Previous highs often act as strong resistance. If the price was rejected from a certain level multiple times, it’s likely to happen again.

For example, Solana is rebounding from the $120 support level. I’d recommend scaling out at the $160 and $180 resistance levels.

📍 Psychological Round Numbers – Prices like $100, $500, $10,000 tend to act as resistance because many traders set take-profit orders at these levels.

Bitcoin has faced resistance in holding above the $100K mark, a key psychological barrier for the market.

📍 Fibonacci Extension Levels – Common extension levels can act as resistance when the price attempts to break higher.

(see lower section for details)

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When Price is in No-Man’s Land