# Exit Strategy Builder - Configure Multi-Condition Exit Rules **Last Updated**: 2026-03-17 **Version**: 1.0.0 ## How It Works ### Open the Exit Strategy Builder Navigate to the Exit Strategy Builder page from the strategy construction menu. This module defines how and when your strategy closes open positions, combining take profit targets, stop loss limits, and advanced exit conditions into a comprehensive exit framework. ### Configure Long Position Take Profit Add one or more take profit condition cards for long positions. Each card can specify a fixed percentage target, an indicator-based exit (e.g., RSI reaching overbought), or a trailing profit mechanism. Multiple take profit cards use OR logic — any single condition triggers the exit. ### Configure Long Position Stop Loss Define stop loss conditions for long positions to cap downside risk. Options include fixed percentage stops, ATR-based dynamic stops, and indicator-driven exits (e.g., price closing below a moving average). Like take profit, multiple stop loss cards also use OR logic. ### Set Up Short Position Exit Rules Configure take profit and stop loss conditions specifically for short positions. Short exits mirror the long position structure but with inverted logic — take profit triggers on downward moves and stop loss triggers on upward moves against your position. ### Enable Breakeven Stop Feature Activate the breakeven stop to automatically move your stop loss to the entry price once a specified profit target is reached. This feature protects against giving back gains on winning trades. Note that breakeven stops modify stop loss placement but do not directly trigger exits. ### Add Time-Based Exit Conditions Configure time-based exit rules that close positions after a maximum holding period, regardless of profit or loss. This prevents capital from being locked in stagnant trades and enforces portfolio turnover discipline, especially important for strategies with high opportunity cost. ### Review the Complete Exit Logic Examine the exit logic summary that shows all conditions for both long and short positions. Verify that take profit targets, stop loss levels, breakeven thresholds, and time limits form a coherent risk management framework without conflicting rules. ### Generate and Integrate Exit Strategy Click Generate to compile all exit conditions into executable code. The generated exit strategy pairs with your Entry Signal Builder output to form a complete trading system. Run a backtest to verify that exit timing, win rate, and risk-reward ratios meet your expectations. > The Exit Strategy Builder supports multi-condition exit rules with OR logic between conditions. Both indicator-based and fixed-percentage exits can be combined for comprehensive position management across long and short positions. ## Tips & Best Practices - Always define both take profit and stop loss for every position direction you trade. An exit strategy with only take profit (no stop loss) exposes you to unlimited downside, while only stop loss means you rely entirely on trailing or time exits for profit capture. - Combine a fixed percentage stop loss with an indicator-based take profit for robust exits. The fixed stop provides a hard floor on losses, while the indicator-based exit adapts to market conditions for more intelligent profit-taking. - Set breakeven stop activation at a realistic profit level (typically 1-2x your stop loss distance). Setting it too tight causes frequent stop-outs on minor retracements before the trade reaches its full potential. - Use time-based exits as a safety net, not a primary exit mechanism. A holding period limit of 20-50 bars prevents zombie positions but should rarely trigger if your take profit and stop loss conditions are well-calibrated. - Test your exit strategy independently by pairing it with a simple entry signal first. This isolates exit performance from entry quality, making it easier to identify whether poor backtest results stem from bad entries or bad exits. ## Frequently Asked Questions ### How does OR logic work between exit conditions? When you add multiple take profit cards or multiple stop loss cards, they operate with OR logic. This means if ANY single condition is satisfied, the exit triggers immediately. For example, if you have a 5% fixed take profit AND an RSI > 80 take profit, the position closes as soon as either condition is met, whichever occurs first. ### What exactly does the breakeven stop do? The breakeven stop is a stop-loss modifier, not an exit trigger. Once your trade reaches the specified profit threshold (e.g., +2%), it automatically moves your stop loss to the entry price (breakeven point). This means you can no longer lose money on the trade, but the stop only executes if price reverses back to entry. The original take profit conditions remain active for capturing gains beyond breakeven. ### Can I use different exit strategies for long and short positions? Yes, the builder has separate configuration sections for long and short positions. This is important because market behavior is asymmetric — stocks tend to fall faster than they rise, so short position exits often need tighter stop losses and faster take profit triggers compared to long positions. ### What indicator-based exit conditions are available? You can use any technical indicator supported by the platform as an exit condition, including RSI threshold crossings, MACD signal line crossovers, moving average price crossovers, Bollinger Band touches, and ATR-based dynamic levels. Each indicator exit is configured on its own condition card with customizable parameters. ## Important Notes > Exit strategies are essential for risk management but cannot guarantee protection against all losses. In fast-moving markets, slippage may cause exits to execute at prices different from your configured levels. Backtesting assumes ideal execution and may not reflect real-world trading conditions including gaps, liquidity constraints, and order fill delays. --- Source: https://stratcraft.ai/help/exit-strategy-builder/