A target is only honest if the market has a reason to reach it: a prior swing, the far edge of a range, a measured move, a Fibonacci extension. A target chosen because it produces a nice-looking ratio is a ratio, not a plan.
Partial targets - closing a portion and letting the rest run - change the arithmetic of your system, so test them as a rule rather than deciding mid-trade.
The mistake it causes: inventing a far target to make the risk-reward look acceptable on a setup that rarely travels that far.
A target is only honest if price goes there
Place it where the market has previously turned: a prior swing, the far edge of a range, a measured move from a breakout, a Fibonacci extension that coincides with structure. A target chosen because it produces an attractive risk-to-reward is a ratio, not a plan, and it will quietly destroy a system by producing trades that almost work.
The arithmetic of inflated targets
| Setup | Fill rate | Expectancy |
|---|
| 1 : 5 target, rarely reached | 10% | −0.40R |
| 1 : 1.5 target, often reached | 50% | +0.25R |
The first row looks far better in a screenshot and loses money. This is why the honest question is never "what ratio do I want" but "how far does this setup actually travel".
Partial exits change the system
Closing half at 1R and letting the rest run feels like free risk reduction. It is not neutral: it lowers your average winner, raises your win rate, and changes expectancy in ways that depend entirely on how often the runner runs. Test it as a rule across many trades rather than deciding mid-trade on a position you are nervous about.
Moving a target is almost always wrong
Extending a target because the trade is working is the mirror image of widening a stop because it is not. Both replace a decision made calmly with one made under the influence of an open position. If you want to capture extended moves, build a trailing rule and apply it mechanically.
What to do with this
- Set the target before entry, from the chart, not from the ratio you want.
- Record whether targets are actually being reached. If most trades close manually instead, your targets are wrong.
- Decide partial-exit rules in advance or not at all.
