Making of a method
- Thread starter game
- Start date
Hi Game,
I've attached the last chart with a couple of notes on it.
If one had placed the initial stop-loss just beyond the end of the entry bar for each of the 5 trades (e.g., below the low of the bar for a long trade), it looks like 4 of them would have gone around 6 pts, 7 pts, 7 pts, and 12 pts, while one of them only moved forward by 1 pt.
Since 4 of the trades had a lot of forward movement, do you think it would be helpful to modify your exit rules to try to catch some of these 6-12 point moves?
Hi Game,
I've attached the last chart with a couple of notes on it.
If one had placed the initial stop-loss just beyond the end of the entry bar for each of the 5 trades (e.g., below the low of the bar for a long trade), it looks like 4 of them would have gone around 6 pts, 7 pts, 7 pts, and 12 pts, while one of them only moved forward by 1 pt.
Since 4 of the trades had a lot of forward movement, do you think it would be helpful to modify your exit rules to try to catch some of these 6-12 point moves?
Thanks for illustrating the chart to better explain your point Slope. Yes I do think there is a lot left to explore in terms of stop and exit tactics.The recent tight MR environment definitely favors taking quicker profits.
Going over the last 3 months of stats, I have realized, that for me the low hanging fruit is not the stop and exit tactics. Rather, it is simply limiting my trading to the highest quality trades. And by now, I have enough experience to identify quite a few of these situations.
Since a lot of my stop and exit management is not based on hard rules but more on making an on the spot judgment regarding the prevailing probabilities, maintaining clarity of mind is vital to my plan. Everything flows from the decision whether to participate or not. My stop management becomes quite good when I have confidence in my ability to make high quality decisions. Ditto for exit management. The major adverse effect of taking too many low quality trades is not the small loss on the trade itself, but rather the disproportional effect it has on my ability to make decisions around high quality situations. So all is contingent upon practicing patience to foster confidence by developing the habit of consistently trading well. If I can do this, I feel the tactical elements will all fall into place.
Example: I took a short after posting my chart this morning, so it's not noted on the earlier chart. Here is the last short:
http://www.sierrachart.com/image.php?l=1399084264152.png
I have 4 preset exit tactics, which can be deployed based on my assessment of the LOLR's intensity. The swing started at 3596 and fell in a parabolic move to 3570. This was a major level noted during prep and the odds were high that there would be a decent retracement at this level. I could have used my parabolic exit tactic to get out here. However, since I had only 1 lot, and since I judged the larger LOLR to be down, I opted to instead wait for the re-test of this level.
In your experience, have you been able to keep your exit decisions adaptable? Or do you periodically cycle through the stats and then use the best fit tactic?
BTW, I am posting on TL, just in case you didn't know.
Yes I have been following your journal there. Good live trading.