How does one effectively "trail stops"?

[murray t turtle]

Yes the Turtles trailed their stops but they weren't using what 99% of traders and all brokers call a trailing stop. Its what I call a ratchet stop, it isn't drawn automatically as price advances, its re-set manually and usually only after the latest close.

I always prefer a Turtle stop or ratchet stop rather than the trailing stop feature my broker offers. I hate the idea of paying a further "tax" on all my profits. The trailing stop also has no TA basis. I'd much rather get out of a long at a new high and aim to get back long again as soon as opportunity presents, than watch price decay and send a pile of money down the drain.

%%
THEY had another semi-public stop, also , but that's beyond this thread.
I SELDOM exit long$ ''on a new HI''/ ;
sometimes maybe after a long series of new HIGHS/LOL
But I like to study trends much + a lot...............................and study super trends, a lot .
Even though profit targets can easy be inferior;
sometimes i like them, SEPT can be different.
AND like Larry ''Mint'' Hite noted with his umbrella ;
when you get some female wisdom, on taking your umbrella LOL . DO THAT.
The risk of a soaking rainstorm\hailstorm In UK or anywhere is very real

 

[tomorton]

As your trading stocks you maybe trading on a higher time frame and that may facilitate trailing stops more efficiently.

But I am trading on a low time frame, only trade the eurusd with a tight SL-TP so because i don't trade in the larger trend, trailing stops is difficult.
I have in the past i tried many strategy's to capture the ongoing trend after my TP was hit

But so many times it hit my Take profit target and then reversed.

So i left it..

Sounds like your tactics match your strategy. Trading on a short time-frame makes extended trend-following and pyramiding difficult to do successfully - few opportunities, many failures.

Many losing traders seem to use tactics from one style in a strategy within another.

 

[tuxedo69]

Sounds like your tactics match your strategy. Trading on a short time-frame makes extended trend-following and pyramiding difficult to do successfully - few opportunities, many failures.

Many losing traders seem to use tactics from one style in a strategy within another.

Hi,
Maybe i should clarify a little, i am a counter trend trader ,trading Fib retracements so my strategy has an entry point a target and stop, as you are aware i am technically trading against the trend (and possibly)the major trend.

So it is not in my interest to try to follow the trend because once my trade is over i take my TP and wait for the next set up.


But the strategy i use really is not concerned with the bigger picture (bigger time frame)

I see deaddog has positions on for days months



Unsure about your comment (Many losing traders seem to use tactics from one style in a strategy within another.)

 

[murray t turtle]

You can trail a stop based on different methods.
First you need a trend otherwise it’s useless

Buying into strength
Selling into weakness

%%
Good /
like Al Einstein noted\ God does not play dice/Put another way\ WE toss the coin; but the Lord controls its decision .
Good points+ 100% true, much better to toss a coin than flip it/markets are like that also .
Proverbs 16 TLB; literally cast dice......LOL

 

[tomorton]

Hi,
Maybe i should clarify a little, i am a counter trend trader ,trading Fib retracements so my strategy has an entry point a target and stop, as you are aware i am technically trading against the trend (and possibly)the major trend.

So it is not in my interest to try to follow the trend because once my trade is over i take my TP and wait for the next set up.


But the strategy i use really is not concerned with the bigger picture (bigger time frame)

I see deaddog has positions on for days months



Unsure about your comment (Many losing traders seem to use tactics from one style in a strategy within another.)

What I mean by mixing tactics from different styles is that many new traders seem to use TP's and early exits to throttle their trend-following trades, but they hold on too long to losing counter-trend trades (which are the majority).

 

[tuxedo69]

You are right ,if your counter trend trade does well not ,, retrace as you expect, many traders will hope (you know the saying).

But that is where pattern recognition comes in to my strategy.

As well as

Pattern recognition
Time when and when not to trade.(very important)
News Speeches
and all the other stuff

Fed Powell talking now

 

[murray t turtle]

That's what a trailing stop is trying to solve.
Could be a simple 20 days moving average: If close < 20SMA then Sell.
It's a thread about trailing stops and if you don't use one then good for you but we don't care.

Bucket Shops used to limit upside (Profit potential) to their customers when the market went crazy.

Doesn't ring a bell ?

%%
LOL= I was not there but i made a little mental note, when[if ] the market gets crazy enough to
delay quotes on his market exits to wipe out all his profits + bankrupt the boy plunger;
cut back size fast LOL.Fed day almost over=so no worries on that today.
NOT my favorite trailing indicator , because it will do sudden reverses @strange times;
but if something works once a year like a 200dma, OK by me. PSAR
Trend follower John Henry notes ,what he calls ''luck'' I call a small sample.
Speaking of small samples, small countertrends that end small ;
good confirmation the main trend did not end/LOL.
BUT some times the counter-trend does not end very fast\
so can trail that inverse trend a bit + not mess with main trend until proof is shown.
Rings several bellsLOL

 

[tuxedo69]

Hi MTT,

Can you explain your post a little.

 

[polybyte]

I mostly use ATR for trailing as it is already adjusted to volatility of a particular asset.

 

[murray t turtle]

Hi MTT,

Can you explain your post a little.

%%
THAT seldom happens, where the markets get so crazy on bid \ask, the boy plunger went bankrupt. SORRY he did not keep some cash in his trade-invest account, every little bit of cash helpsLOL
MAIN trail stops points, was PSAR[paraboilic stop + reVerse helps.
PSAR is not exceptional ,on trailing profit + loss , but worked in monthly candles, hindsight on 1999 + 2000 bear ,so i glace @ it sometimes.
IN hindsight PSAR gave a good buy signal on FEB + MAR,2023, buy SPY benchmark. NOT a stock tip, but good hindsight + good help, on an uptrend.........