We hear all the time that a trade should be scaled out of by one half when you reach a profit target then set your stop loss to break even on the remaining portion of the trade and let it run to see if it will make more money. By scaling out of a trade means to us that the trade was too large to start with when there was the greatest amount of risk.
We feel that you should start out small then add onto the trade when there are add on signals. By letting one half of a trade run to see if it will make more profit says to us that the trader did not know or have any indicators that would let him know when to get out.
We suggest that you should start out small with a stop loss. When the trade moves in your direction then add on or scale into the trade once the trend proves itself. This way you have minimal exposure when things are at most risk. When you start to add on or scale in your stop loss on your first trade should be at a break-even or a small profit so you will not suffer a loss on that trade. We like to start small add on big then get out all at once. If the market gave us a head fake and keeps on going then we can reenter the market with our profits in the bag. If we see signals to reenter the market we are most likely playing with house money. This gives more confidence because we can have a little loss and still have a profitable day.