ES Journal Archive (2006 - 2008)

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Quote from Buy1Sell2:

Yes, however it is generally employed by a trader who has taken a position that is too large for their means and becomes an "urgent" risk management tool. It also strokes the ego a bit, by being able to "book" a profit.
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Since we have time to kill right now ... want to talk about scaling out a bit more here.

Scaling out can be the proper approach if the initial position taken is in fact, a "composite signal". For example, selling the top today can be a composite signal for some that,

a. a 90% 2 points pullback setup
b. a 60% sell towards some 4+ points away moving average
c. a 50% sell that can result in 20+ points target

For someone trading multiple signals, it is then the right thing to do to take profit at the 2 point target for the part of the position that is meant for signal a and then take out another portion of the position at the target of b.

The hard part is, as far as my experience goes, is that most people would choose to have a single stop on all 3 parts and that may not be the best way to deal with composite signals :)
 
scaling in/out

my thoughts.....

I like scaling in,sometimes I average down, but never average a short position

just like I dont use stops,I dont average out.sell it al at the best price.

fyi...........
 
LC, I would offer this--

What you have defined as a,b,c are actually 3 separate trades. Each should be allowed to run to it's maturity or trailing stop and not scaled out of.


And, thank you very much for posting here regularly. I always enjoy your postings==Ishmael
 
We have now extended a bit past the recent minor reaction high on the daily. This will be interesting to see if this can hold. I will stay long here with the same stop that I posted recently.
 
I've never been a scale out trader but this market has made me a believer in the theory :)

I've been long since 1224 and got out at 1279 on the drop last Monday. During that time the ES probably traded a total range of 300-350 points...yet I got 55?

In addition to the financial loss of potential profits...all that up and down with NOTHING to show for it is a real emotional killer.

A classic example was last Friday - Monday. Usually I would hold my 30 point profit on Friday but, with this market, I took off a contract up there and put it back on lower. At least I got paid for my time.

I'm never an advocate for scaling out but the current ES trading makes it necessary $$$$ and emotionally for me. I admire your resolve B1S2.
 
08-28-08 08:33 AM

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08-27-08 02:23 PM

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08-26-08 01:09 PM

08-26-08 01:01 PM

Will get long with 20 @ 1267.75
Stopped in---Initial stop 1261.50
Back to normal trading today---Stop moved to 1254.00
Sell stop raised to 1261.00
Sell stop raised to 1263.00
Sell stop raised to 1270.25
Stop remains the same for overnight.
I will keep the sell stop the same this morning @1270.25
Sell stop raised to 1273.25
Sell stop raised to 1278.25
Sell stop raised to 1279.25
 
Quote from Buy1Sell2:

LC, I would offer this--

What you have defined as a,b,c are actually 3 separate trades. Each should be allowed to run to it's maturity or trailing stop and not scaled out of.


And, thank you very much for posting here regularly. I always enjoy your postings==Ishmael
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Exactly - they are 3 separate trades.

Just happen to share the same entry.
 
Quote from Lawrence Chan:

Exactly - they are 3 separate trades.

Just happen to share the same entry.
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In my view then,
a) should be let run for 2 points
b) should be let run for 4 plus points and
c) should be let run for 20 plus points

All using trailing stops
 
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