Profit taking

Profit Taking
Investment Dictionary - Profit Taking
Profit taking is the process associated with selling stock and thus receiving profits. Taking chips off the table is an analogous process.

Profit Taking
What It Is:
Profit taking is the act of selling stock to take advantage of a sharp rise in the stock price.

Profit taking by a number of investors normally causes the price of the asset in question to fall temporarily. Nevertheless, the occasion of profit taking itself indicates an upward market trend.
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Profit Taking and Trade Exit
When to exit a trade is always a difficult question. Longtime professionals incessantly question the ideal exit points for their trades.

Advantage of using multiple profit taking levels
Recent message from one of our members questioned our use of multiple exits and the fact that the exits in a particular system were very complex and would sometimes move closer to the prices and ...

Profit Taking
Since momentum can reverse at any time, and it can be either extremely strong or disgustingly weak, gap trading strategies usually call for the use of a trailing stop to take profits.

Profit Taking
The unwinding of a position to realise profits.
Proxy Hedge ...

Profit Taking
Closing a position with the purpose to make a gain.
Program trading ...

Profit Taking Selling stock after a period of rising prices to realize the profit. The term is used to explain a downturn in the market.
Pro Forma Projected
Promissory Note (PN) Promise to pay.

Profit Taking
Selling tradables that have appreciated since initial purchase in order to take advantage of the appreciation.

Profit Taking: Closing an open position to take profits.
Proxy: A device that sits between a computer and the internet.

Range Action Verification Index (RAVI): Indicator that can be used to determine whether an FX instrument is trending.

Profit Taking - A term used to explain a drop in a stock price or in the general market absent of bad economic or financial news. The idea
is that the reason investors are selling is to lock in profits.

Profit taking
Action by short-term securities traders to cash in on gains created by a sharp market rise, which pushes prices down temporarily but implies an upward market trend. See: Ring the [cash] register.

Profit taking now begins to set in. Traders who were long from the lows decide to take profits. They have a good trade and start to protect profits. This causes a pullback in the prices and is called Wave 4.

... profit taking automatically moves dollars from overheated sectors to cash or undervalued sectors during rising markets. This process creates capital that can be used to lower the average cost of remaining ...

Pervasive profit taking takes its toll on those who remain long. This induces a snowball selling effect in the coming days.

Profit Taking: Selling securities to take a profit.
Program Trading: Trades based on signals from computer programs, usually entered directly from the trader's computer to the market's computer system.

It was merely profit taking. We wouldn't want to see it trade back below Thursday's low of $15.38. That would tell us it's probably coming back down to test the T-line.

This pattern is found in down trends and is viewed as a period of profit taking. This is a bearish signal. (see bearish candlesticks) Downside Gap Tasuki pattern has a second day white candle that closes an overnight gap from a black candle.

The impact of the second black day gapping lower and declining causes a day of profit taking and since this cannot penetrate higher than the gap between the first and second black days, ...

RS is also a great tool for profit taking:
Divergence can also be used for profit taking.

This indicates that there is still strength in the uptrend and that the correction is merely profit taking rather than the emergence of strong selling and is thus unlikely to be last long. Thus, the uptrend can be expect to resume.

The fourth day opens in the direction of the trend, however it then moves in opposite direction due to profit taking. There may be a reevaluation of the market direction now.

Gold (GLD) and gold stocks have had a great run higher and some profit taking stepped in last Thursday and Friday by the looks of it.

Systems that offer this option should only allow you to place orders falling profit taking on the good side of a transaction.

On the other hand, Fibonacci extension levels are used as profit taking levels. First, a line is drawn from a significant Swing Low to a recent Swing High, and then another line is drawn to the retracement Swing Low.

The price has risen for some time, at the peak of the left shoulder, profit taking has caused the price to drop or level.

The upside tasuki gap is a bullish continuation trend and is the result of temporary profit taking in a strong upward market.

While I would not be surprised to see some profit taking when they market reopens on Tuesday after the July 4 holiday, ...

Ross hooks always occur as the result of profit taking. A Ross hook is defined as the first failure of prices to continue in the direction they were previously moving following the breakout of a 1-2-3 formation, ...

After a considerable move, a logical period of profit taking for shorter term traders as well as entry points for new traders and investors who missed the original move cause an up and down-sideways movement on a chart.

If you are trading on 4H chart, you can choose partial profit taking not to miss big movements.

This is simply a profit taking scenario for the shorts and a sucker entry for dumb longs. We have a weak stock in a downtrend that bounces. As long as the white day is on lighter volume, the bears will most likely retake control soon after.

Traders use the Fibonacci extension levels as profit taking levels.

Just too often, a break of an uptrend is just due to profit taking. Then, the next day, investors often pick up on this stock that has now become cheaper and buy into it again continuing the uptrend the stock was in just before it droped.

The prices gap up with huge volume; then, there is great profit taking and the demand for the stock totally dries up. Prices drop, and a significant change in trend occurs. Exhaustion gaps are probably the easiest to trade and profit from.

Wilder's intent was to create an indicator that capitalized on a trending market and systematized profit taking.

Next, profit taking and selling begin as the sellers take control, and prices are pulled back down until selling reaches a point of exhaustion and the market is oversold.

Before some of you lump me in to that greedy, conscienceless, earth-destroying,money grabbing profit taking bunch that will cause the death of us all you might consider that I need the money for the huge increase in health care costs that I will face ...

The Fibonacci extension levels are used by Forex traders as profit taking levels. Almost all software that is used for charting Forex includes tools for both Fibonacciextension level and retracement level.

In an uptrend a white day occurs, followed by another white day that gaps up. A black day ensues, and is likely the result of temporary profit taking. The trend should continue to follow the direction of the upward gap.

Of course, one-sided markets do not last forever, and when the exuberance and euphoria that drive the uptrend to successive new highs breaks down, the reaction by the sellers is reinforced by profit taking, ...

You'll see irrational lack of deterrence by lack of profit taking and they'll continue to hold the price up. If the bears are committed, they'll continue to sell the stock down, undeterred by lower prices.

"Ring the cash register"
Used in the context of general equities. "Take a profit." See: Profit taking.
Rio de Janeiro Stock Exchange (Bolsa do Rio)
Brazil's major securities market.

On day 17 you buy your first contract at 880 and place a profit taking order at 910 and a second buy at 850. From this point if the market goes up, you take a profit. If the market goes down, you buy additional contracts according to your scale.

In Wave Four, traders again take profits because the market is again considered expensive. This wave tends to be weak because there are usually more traders that are still bullish the market, and after some profit taking comes Wave Five.

The main difference between a limit order and a stop order is that stop orders are usually used to limit loss potential on a transaction whilst limit orders are used to enter the market, add to a pre-existing position and profit taking.

As a result, when the Volume MA began to move down after hitting its peak, we see that the S&P 500 index reversed into a downward correction. This volume surge marked profit taking.

This leads to post hoc rationalisations about why the market behaves in a given way. For example, you will often hear the expression "the market went down on profit taking". Unfortunately such explanations are wrong.

The latter is often trickier than the former as one needs to have some pretty good experience with the warning signs of an end of trend and a good idea of where profit taking may start to initiate new entrants contra trend (and with you).

Your losses are thus restricted to the period after your last profit taking. You then offer your sympathy to investors who did not disinvest and had to bear heavy loses. Duck if they take a swing at you.

See also: Profit, Market, Trading, Trend, Chart