Some traders believe that the exit is actually more important than the entry to a trade. One of the best traders I know says "you can give any position long or short, I'll manage the risk, have a specific exit strategy and the trade can be successful." He takes the approach that he does not know where a stock is moving, but he always knows what he is going to do to let profit run and manage risk.

I asked this trader for some exit strategies that he uses. He gave me the exits for long positions. A trader can reverse many of these for short positions. Here are some of his favorites.

Maximum loss of 15%, example: you can make it 10%12% or 20%
Exit trades below a moving average for 30 days, example: Stock below 50 day moving average for 30 days
Exit trades that close below the low of last 20 days, example: make 10 days, or 30 days
Trailing stop loss orders from the high close of a move, example 15% from Highest high of last 10 days
After RSI, Stochastic value is overbought, close position, example Stochastic value greater than 85
The MACD indicator closes below the zero line
Exit a long position if stock gaps down and closes on its low

There are so many possible exit strategies a trader can use. They also can be used in combination with each other.

It doesn't matter if you are long or short, you should always know your exit strategy. Most traders have two exits. One if the trade does not work out from the beginning as a money stop loss. The other exit is for winning positions to end the trade.