Building the Perfect Trading Strategy | OVTLYR UNIVERSITY Lesson 17
Protect the Base
Introduction
When you're in a winning trade, it's easy to feel invincible. But gains can vanish fast if you’re not managing your exits properly. This lesson teaches you how to protect your profits without cutting winners short.
1. Lock In Profit Without Losing Potential
● Your goal is to stay in the trend while protecting what you've earned.
● That means managing from the base, not from the top.
● Never assume the top is in. Focus on structure instead.
2. Structure Is the Stop, Not the Price Target
● Exit only when the chart structure breaks:
○ A lower high followed by a lower low
○ Clear loss of momentum or trend breakdown
● Don’t sell just because the price pulled back.
Price targets are guesses. Structure is confirmation.
3. Use Higher Timeframes for Exit Clarity
● 1-hour and daily charts help filter out noise.
● If the lower timeframe looks weak, check the higher one.
● Stay in the trade if the larger structure is intact.
This keeps you from getting shaken out prematurely.
4. Don’t Trade Based on the PnL
● Watching your gains rise and fall in dollar terms creates emotional decisions.
● Focus on the chart, not the money.
● The moment you start managing the trade based on how much you're “up,” you're no longer following the system.
5. Protect the Base = Stop Below the Last Breakout Area
● Set your stop below:
○ The most recent consolidation
○ The last breakout level
○ A major moving average that’s been respected
● Don’t trail your stop too tight just to “lock in gains.”
Give the trade room to breathe while still being protected.
This concludes Lesson 17. You now know how to ride trends longer, cut out noise, and protect profits by using chart structure, not gut feelings or price targets. Your job isn’t to guess the top. It’s to follow your system and protect the base.
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