How wide a stoploss?
- Thread starter NiteRider
- Start date
The best advice I could give you is: Wherever you do decide to place your stops,just be sure not to risk more than 2% of your trading stake. In other words,if you have $10,000 in your account,
wherever you place your stop, make sure you don't lose more than $200 if your wrong.
As far as using support and resistance levels, that's fine,but just
keep in mind the guys on the floor see those levels,too. So it might be wise to place your stop a little ways above(below) these levels.
"Whenever I enter a position, I have a predetermined stop. This is the only way I can sleep. I always place my stop beyond some technical barrier. I try to avoid a point that floor traders can get at easily."...Bruce Kovner
This was a horrible play from the beginning. First of all you entered during the dead zone. I only enter trades during the first 2 hours of the days or the last hour. Secondly, u got to stop playing these dimestore stocks. You got to be in the higher priced issues to make any money in the short term. Lastly, a double bottom appeared earlier in the day. The intra day range was already eaten up, but u entered short anyway. How much were u planning on making on this trade??? I think Don is correct about not setting stops on this play. This is a play that needed lots of monitoring to be successful. You'll find more success playing the higher priced stocks.
Take Care
Sterling
Take Care
Sterling
My point is simply that you should not really be too involved with big positions requiring stops when you cannot monitor the positions.
This is simply how a lot of people lose a lot of money...my intentions are never to offer advice that would add to risk or anything like that.
We find that mental stops save/make a lot of money due to "trade throughs' "reaching for stops" and all the rest ...and I am sure you have all experienced that.
Doesn't it feel horrible when you're stopped out, and come home just to see you could've made big money?
I didn't mean to anger anyone to the point of nastiness...as always, I just speak (type) clearly my feelings. You don't have to agree, many don't.
I realize that a few of you are following somebody's "system" that insists you use stops, and that's fine...
it simply makes sense to me that you monitor your trades via alerts...they even have alerts on pagers now.....
Sorry...
This is simply how a lot of people lose a lot of money...my intentions are never to offer advice that would add to risk or anything like that.
We find that mental stops save/make a lot of money due to "trade throughs' "reaching for stops" and all the rest ...and I am sure you have all experienced that.
Doesn't it feel horrible when you're stopped out, and come home just to see you could've made big money?
I didn't mean to anger anyone to the point of nastiness...as always, I just speak (type) clearly my feelings. You don't have to agree, many don't.
I realize that a few of you are following somebody's "system" that insists you use stops, and that's fine...
it simply makes sense to me that you monitor your trades via alerts...they even have alerts on pagers now.....
Sorry...
Sounds like your going for mulit-hour profits with 10 minute bars? You can do that, but it might be easier to see the major intraday s/r by going to 30 or 60 minute bars if your attempting multiple 10-min bars of profit. Using 30 or 60 minute bars, primary resistance would've been at $12.61 (to me), because the stock cycled up to 12.66 on 4/30, 12.82 on 5/2 (excluding the big spike above close of 30-min bar), then $12.61 on 5/2, completing a short-term h/s pattern. You can see on 5/3 (today) it pierced the neckline of the h/s pattern but retreated. I use the open or close of the bars to determine patterns, not the high or low if they have extra long tails, because if they can't hold the ground it shouldn't count (IMO, but it works for me). Also, those morning surges turn out to be meaningless a lot of times, so I usually filter those out unless they hold. Just my two cents.
Originally posted by NiteRider
What are some good rules of thumb for stoploss setting for swing (overnight+) trading?...Its not working too well.
My poor P&L with stoploss settings lately is mostly since I began leaning to shorts more often. I try to use a trailing stop above prior intraday resistance levels as my shorted stock falls but lately they always come up and get me then head back down...
An example from today:
http://www.cg-imt.com/homestuff/sepr.jpg
I shorted and then followed SEPR down today and when it hit $12.30 I moved my stop down to $12.51 to guard against a reversal just above the most recent intraday resistance at 11:40AM, 11:50AM, and 12:05PM (white horz. line).
Well as you see the intraday reversal took me out right after 1PM today so I missed out on the last big drop of the day and the other 24cents of move and likely more downside Friday.
...I'd appreciate hearing strategies or advice from any swing-overnight-multiday traders here.
Thanks
NiteRider,
I took a peek at your chart. I have a few questions...maybe I missed it.
Your simple chart doesn't show where you enter your short. Thus, what price did you short at?
Also, is that what your charts normally look like when you trade or did you remove all your indicators? If so, why?
Show us a chart with entry price and indicators of exactly what you use.
That should be able to help with answers to your question.
Why do I make such an issue of this.
Yesterday, a friend came over and ask me to review some charts he printed out of his trades. They were all 5 min chart intervals with no indicators.
Yet, he's a swing trader and he ONLY uses 30 min chart intervals with volume weighted moving averages and RSI...none of which was on the printed charts he wanted me to review.
Thus, I think stops/loss are based on what we as traders use as our trading methodology. If I make my trade decisions based on 10 min chart intervals then my stop/loss protection should be based on the same chart interval or else everything becomes a big mess.
I do see a thick horizontal line...does that represent your price entry or where you lower your stop?
Nihaba Ashi
archangel:
RESPECT !
you name the things as they are.
just let me tell about ways which have not been told yet for niterider etc.
think about drawing down.
for daytraders, i guess its the worst thing. u buy/sell the wrong way means against you.
but those who have time to wait for the move in the right direction and dont watch their screen permant could add their position or reach a good average price.
in case of going long (good setup detected !!)
why not buying just half or third of position and add a second entry with a limit lower than the entry.
(sure, more than 1% away !!)
it makes a average price, and as long as the stock is in upper way, its possible to decline the average entry. also partial profit may be taken if stock moves the right way.
well, a mental stop loss should be there. as an uptrending stock, falling under important resistance( MA50, MA 20 depending to everyones trading style) should by done.
just think about it niterider and co
by the way:
day trading is a day job until you know how to get flat with profit in earlier session hours.
who is not able to spend (sometimes neccessary) time for waiting the moves should not daytrade as long as he/she is unexperienced in that.
swinging makes also money, as long as if you trade the right stocks.
and finding the right stocks is the work, either for daytrading or for swinging or for investing......
so long
lippi
RESPECT !
you name the things as they are.
just let me tell about ways which have not been told yet for niterider etc.
think about drawing down.
for daytraders, i guess its the worst thing. u buy/sell the wrong way means against you.
but those who have time to wait for the move in the right direction and dont watch their screen permant could add their position or reach a good average price.
in case of going long (good setup detected !!)
why not buying just half or third of position and add a second entry with a limit lower than the entry.
(sure, more than 1% away !!)
it makes a average price, and as long as the stock is in upper way, its possible to decline the average entry. also partial profit may be taken if stock moves the right way.
well, a mental stop loss should be there. as an uptrending stock, falling under important resistance( MA50, MA 20 depending to everyones trading style) should by done.
just think about it niterider and co
by the way:
day trading is a day job until you know how to get flat with profit in earlier session hours.
who is not able to spend (sometimes neccessary) time for waiting the moves should not daytrade as long as he/she is unexperienced in that.
swinging makes also money, as long as if you trade the right stocks.
and finding the right stocks is the work, either for daytrading or for swinging or for investing......
so long
lippi
1. I entered when it failed to break above 12.70 again but was filled at 12.60 (stupid uptick rule). My initial stop was at $13.01 and my target profit price was $11.80 but I like to trail behind my targets so they can run farther if they want to. Maybe in this market thats not a good idea?
2. No that's not the chart I use to trade from. I cropped out a quickie one that showed enough (I thought) of the price movement for the time period that wasn't too big to post as an image. I use 3 charts once I'm targeting an entry: a 3min, a 10min. and a 30min. which I normally pulled once it hit a scanner or target from my watch list. I have moving averages, volume and MACD. I use 50dayEMA, 20EMA initially and on the minute charts of course those become minuteMAs.
By a few comments maybe I'm seeing things that aren't there but I saw the slight consolidation and less steep decline on its way to the first bounce at 12.30 and I read that as a possible reversal signal so I wanted to protect my profit in case it rebounded for the day.
The double bottom only reinforced that opinion.
I'm not whining. I don't trade big sizes so its not a ton of money won or lost. But the goal is too learn while I'm trading 100-200 shares and if I can learn in this market everyone is saying is so tough I should be jamming if it ever gets easier (?) or better.
Thanks for all your input and opinions and to ssb and arch for the charts you posted.
Don, your opinion is appreciated but that's not an option for me.
I haven't achieved anything really good without a little sweat and lumps while I figured out how to make the pieces fit. There is a method to trading part-time without being glued to the monitor. I just have to find the right combinations and keep learning better setups and rules for my trades.
2. No that's not the chart I use to trade from. I cropped out a quickie one that showed enough (I thought) of the price movement for the time period that wasn't too big to post as an image. I use 3 charts once I'm targeting an entry: a 3min, a 10min. and a 30min. which I normally pulled once it hit a scanner or target from my watch list. I have moving averages, volume and MACD. I use 50dayEMA, 20EMA initially and on the minute charts of course those become minuteMAs.
By a few comments maybe I'm seeing things that aren't there but I saw the slight consolidation and less steep decline on its way to the first bounce at 12.30 and I read that as a possible reversal signal so I wanted to protect my profit in case it rebounded for the day.
The double bottom only reinforced that opinion.
I'm not whining. I don't trade big sizes so its not a ton of money won or lost. But the goal is too learn while I'm trading 100-200 shares and if I can learn in this market everyone is saying is so tough I should be jamming if it ever gets easier (?) or better.
Thanks for all your input and opinions and to ssb and arch for the charts you posted.
Don, your opinion is appreciated but that's not an option for me.
I haven't achieved anything really good without a little sweat and lumps while I figured out how to make the pieces fit. There is a method to trading part-time without being glued to the monitor. I just have to find the right combinations and keep learning better setups and rules for my trades.
I can't tell much about a stock without my 20 or 21 period moving average, with 30 minute candlecharts.
[Swing trade or day trade moving averages help with stops.]
Niterider, for swingtrading do you notice the smoother,more profitable [probable] trend is for LSS,compared to SEPR. ?????????? [I'll admit most small caps don't ride the 20 or 21 moving average that smoothly,5 day 30 minute charts.] However with LSS and such patterns, the smoother the better for stops.
Day trading NASDAQ around these fierce,tricky downtrends. I try to avoid sideways trends.[Flat as a crooked board] I use a mental stop,written in my notebook,on NASDAQ daytrades.
[Swing trade or day trade moving averages help with stops.]Niterider, for swingtrading do you notice the smoother,more profitable [probable] trend is for LSS,compared to SEPR. ?????????? [I'll admit most small caps don't ride the 20 or 21 moving average that smoothly,5 day 30 minute charts.] However with LSS and such patterns, the smoother the better for stops.
Day trading NASDAQ around these fierce,tricky downtrends. I try to avoid sideways trends.[Flat as a crooked board] I use a mental stop,written in my notebook,on NASDAQ daytrades.