Targets

For three-period trend state signals and the forward-adjusted EMA, natural exit targets are the forward adjusted EMA and the extreme Bollinger Band (i.e., the upper band for a long trade and the lower band for a short trade).

Targets in the three-price break method are provided by Fibonacci numbers — 3, 5, 8, 13, 21, 34, etc. The Fibonacci ordinal degree of new prices achieved in trend provides exit points.

For example, if you are long, the first profit-taking point would be at the third new high close in trend; the next profit-taking target would be at the fifth new high close in trend; the next would be the eighth new high close in trend, and so on.

It shows the three-price break data for different time periods. One approach is to focus on Fibonacci based time periods for intraday trend following (one-minute, three-minute, five-minute, eight minute, 13-minute), as well as the 30-minute period. The table highlights when the trend hits three new prices in trend (up or down) on the daily time frame and the eight minute time frame. (Note that in the five-minute time frame, the trend is already rather extended at 22 periods.)

You can use trend reversals in any time period as an exit (usually it will be the shorter time periods that reverse first), thus preserving gains from earlier entry. Knowing the trend state in these Fibonacci based time periods is helpful in managing trades.