Kase on Technical Analysis Workbook, + Video Course

CHAPTER 7 Using Stops to Exit Trades: Taking Profit, Cutting Losses

ANSWER 7.1

1. $90.00
2. $80.00
3. $85.00
4. $95.00

ANSWER 7.2   C Weekly with SMAs 3, 21

1. An inactivity stop might have been used to exit on sideways activity.
2. There are two long trades where an inactivity exit might have been justified. The first to the left peaked in early July, then fell for five bars. So with no profit for these five bars, an exit here might have been justified. If one had waited until eight bars, an exit might not have been taken there because prices recovered. Then there were another three bars against the trend, but the low formed a mini double bottom with bar five, so at that point, one might have remained in the trade. In January, another long trade peaked, then fell precipitously. In this case, one might have exited after three bars, given the large drop. The fifth bar showed a slight recovery, but still closed there, so an exit could have been taken on that bar.
3. The short trade that followed in late February did decline throughout March. After that, prices rose and then fell off slightly, so one might not have exited after five bars. However, at bar seven there was a close over the fast MA and then at bar eight over the slow MA. So an inactivity exit might have been taken at bar seven or eight.

ANSWER 7.3   GILD with Fixed Value Trailing Stops $4.33 and $7.66

1. Fixed value trailing ...