Why did my 1-2-3 trade close?
Quick answerIt reached one of its three exits: the target 5% over the entry, the stop 10% under it (on a wick, during the day), or the close on day 30.
The details
The usual reasons
- A wick through the stop: the stop counts during the day. A dip 10% under the entry ends the trade even if the stock closes back above it.
- A gap: a stock that opens past the stop or the target fills at the open price.
- Day 30: neither reached by the close of the 30th daily candle after the entry, so out at that close, up or down.
- The target: 5% over the entry.
Calls open on Oct 22
That day the exits changed to today's (−10%, +5%, day 30) and every call was replayed on them. Calls that were open moved to the new stop and target, and a few ended right away and posted their end.
The option
When the stock hits its target or day 30, sell the option too. When the stock is stopped, the option has no stop and keeps its own exits (the option after a stop).
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