Taking Profits
Taking profits in narrative holds is about managing expansion, not timing tops.
You're not trying to exit perfectly. You're trying to extract value while attention is still growing. Expecting a clean, obvious sell signal usually leads to holding too long.
How it works
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
Most narrative traders scale out gradually rather than exiting all at once.
Take partial profits when discussion suddenly picks up speed.
More eyes = more risk = good time to secure some gains.
Reduce size after price expands significantly.
You're selling into strength when others are buying.
Take enough off to hold the rest calmly.
Once you've secured profit, decisions get clearer.
This lets you stay involved in the narrative, protect gains, and hold remaining size without stress.
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 and late buyers are chasing. Risk is highest when confidence is highest.
Selling into strength means you exit when others feel confident, not when fear forces you out.
Letting winners run responsibly
Narrative holding doesn't mean holding forever.
If the narrative continues expanding, attention remains consistent, and participation stays healthy, holding a reduced position can make sense.
Your goal is participation, not ownership. As conditions change, size should change too.
How profit taking affects psychology
Securing profits changes how a trade feels:
Reduces emotional pressure
Improves decision making
Allows patience
Prevents desperation
Once some profit is locked in, you can observe more objectively.
Warning signs
If you're afraid to sell anything, constantly hoping for higher prices, or justifying staying without evidence, it's time to reassess whether conviction is still supported.
Profits are part of the strategy, not a betrayal of it.
For more on profit frameworks, see The Art of Taking Profits.
You don't need to capture every dollar. You need to manage risk while expansion lasts.