Taking Profits
Taking profits in narrative conviction trades is about managing expansion, not timing tops.
You are not trying to exit perfectly. You are trying to extract value while attention is still growing.
Expecting a clean, obvious sell signal usually leads to holding too long.
How profit taking works in conviction trades
Narrative trades expand in phases.
As attention grows:
price moves in waves
volatility increases
participation broadens
This creates multiple opportunities to reduce risk and lock in gains.
Selling everything at once is rarely necessary.
Scaling out instead of selling all at once
Most conviction traders scale out gradually.
Common approaches include:
taking partial profits as attention accelerates
reducing size after large expansions
securing some profit to reduce emotional pressure
This allows you to:
stay involved in the narrative
protect gains
hold remaining size more calmly
Once risk is reduced, decisions become clearer.
Selling into strength
Profits are best taken when:
attention is increasing rapidly
discussion becomes widespread
price moves aggressively in a short time
This is when:
new participants are entering
late buyers are chasing
risk increases
Selling into strength means:
you exit when others feel confident
not when fear forces you out
Letting winners run responsibly
Conviction does not mean holding forever.
If:
the narrative continues expanding
attention remains consistent
participation stays healthy
Then holding a reduced position can make sense.
Your goal is participation, not ownership.
As conditions change, size should change too.
What to avoid when taking profits
Common mistakes include:
waiting for the perfect top
refusing to sell because of conviction
round tripping large gains
comparing exits to others on Twitter
Profit taking is personal.
Your plan matters more than screenshots.
How profit taking affects psychology
Securing profits changes how a trade feels.
It:
reduces emotional pressure
improves decision making
allows patience
prevents desperation
Once some profit is locked in, you can observe more objectively.
When profit taking becomes a warning sign
If you find yourself:
afraid to sell anything
constantly hoping for higher prices
justifying staying without evidence
It may be time to reassess whether conviction is still supported.
Profits are part of the strategy, not a betrayal of it.