7 Best Profit-taking Strategies in Trading

18.8. 2025 (Last update: 3.12. 2025)1900x

The best profit taking strategies are those that align with market behavior, risk management, and trader discipline. These include exiting near support or resistance zones, avoiding weekend exposure, using daily range and candlestick patterns, steering clear of major news releases, following trend breaks, and employing time-based exits for consistency.

Let’s take a closer look at each of these profit taking strategies and how you can apply them to your trading routine:

1. Support and Resistance Zones

Most times, markets respect historical turning points. You want to take note of these key levels when placing your positions. If you’re buying, TP when the price is approaching the resistance area. For a short trade, exiting before a support level (where price could rebound) is considered a good technique.

2. Before Weekends

Weekend holding exposes your positions to riskier scenarios. One unexpected news event or gap can shut you out. Thus, it is safer to close all trades before the market closes on Fridays. This is very important for short-term speculators.

3. Daily Range

Average Daily Range can be used to set reasonable and realistic intraday profit targets. It shows you how much a currency pair habitually moves in a single day.

To calculate it, pick, say, the last 5 to 10 daily candles. For each day, subtract the day’s low from its high (High – Low). Add all of them up and divide by the number of days. The answer is your ADR.

You shouldn’t expect a 200-pip movement for an asset that usually moves around an average of 70 pips a day.

You want to set your TP at 40 – 60% of the ADR for each trade. This means aligning your exit with the instrument’s natural daily volatility.

4. Candlestick Pattern-informed Exit

There are some candlestick patterns that can signal to you what to expect next in the market. Reversal candle formations like pin bar, doji, engulfing pattern could mean exhaustion of the dominant trend especially when they appear at a key price level. Where to set your profit target in this case? Do it immediately after the formation and close of the candlestick.

5. Before a Major News Release

Befriend your economic calendar. Staying up to date with upcoming events prepares you ahead and informs where you leave the market. Always take your profit or exit the market before any big announcement drops to protect yourself from extreme swings. Trading during news is very risky.

6. Trend Following Exits

When following a trend, if price breaks a key trendline, crosses below a long-term moving average (in an uptrend), or moves out of a defined channel, you should expect a possible trend reversal. Thus, it might be smart to take your profit after “a trend breaks”.

7. Time-based Exits

Here, you simply leave the market after a pre-set time, whether the price hits or doesn’t hit your TP or stop loss. This allows particularly day traders to stick to a routine and avoid overnight risk.