Who it's for — Anyone who wants to bank the plan without holding until profit evaporates from indecision or greed.
Take profit (TP) automatically closes a position in profit when price hits the preset target. Mirror of stop loss: SL caps loss, TP realizes planned gain.
In simple terms — Long at 100, TP at 120: when market touches 120, you sell and lock profit — even if you're not watching the chart.
Mechanics
Technically TP is a limit order on the opposite side of entry:
| Position | Take profit |
|---|---|
| Long (buy) | Sell limit at target |
| Short (sell) | Buy limit at target |
As a limit order, exit price is defined (except extreme gaps/slippage); often maker or reduced fees vs market.
Why use it
Markets rarely move in straight lines: price can hit target then reverse. Manual profit-taking is emotionally hard; TP applies the cold-head plan and supports measurable risk/reward.
Common mistake — Moving TP further away mid-trade «because it'll go higher» — destroys R:R and turns winners into breakeven or losses.
Summary
- Function: Realize target profit.
- Base order: Limit.
- Operational pair: Stop loss + take profit = bracket.
Bronze path — Execution / risk module. Index: Bronze path.