We all wish that this would happen on every trade. You search and study for the best opportunity to enter. Position size perfectly relative to your risk tolerance then sit back and wait for the stock to move in your favor... hopefully. To your surprise you find that the stock moves to your target much faster than you anticipated. It could be that some good news hit the markets, your stock sees in influx of buyers on a rumor, or just that the stock simply made it's way to your target faster than you thought.
If this has ever happened to you then you know exactly what comes next. What should I do? Should I hold out for more profit since I got here so quickly? Does this mean there is much more money to be made? If I sell now will I miss out on more money?
So, what should you do if your stock hits it's target faster than anticipated? Well, there are two schools of thought here which will give you a few options.
Number one is you could simply move your stop loss to your break even and see what happens. You then look for a second target you have in mind and shoot for that. Instead of spending your time waiting for the second target, you spend your efforts on finding moments to raise your stop as close to or to your initial target. Psychologically if you can get your stop to the target you had in mind anyways then you will feel good no matter what happens.
The other choice is to simply take your profit at it's initial target that you set out to achieve in the first place. The school of thought here is that you were successful. You picked a trade and it worked. Who cares how fast it hit your target, it hit your target! This is also psychologically rewarding because you are confirming your skills as a trader.
Which path you choose will depend on a number of factors. Trading is a difficult game so, many traders will opt to simply take their profits when they have them. Happy trading.