The chart you posted on the ER2 symbol is probably much closer to how price action actually moves than any linear trending model ... even when the markets are in a strong upwards or downwards trend.Quote from ProfitTakgFool:
Buying a lower low has a MUCH higher probability than a higher low but that view is based on my experience and I can't offer any evidence to support that so easy on the anger fellas
Money Mgmt beats Stops Everytime - Example
- Thread starter ProfitTakgFool
- Start date
This is a short article on stops by Jason Alan Jankovsky (the author of Trading Rules That Work).
Hope you find it useful.
http://www.tradingmarkets.com/.site/forex/how_to/articles/-74341.cfm
Hope you find it useful.
http://www.tradingmarkets.com/.site/forex/how_to/articles/-74341.cfm
Just from skimming the article, I completely agree with this, "3. Use the next highest time frame from your preferred trading time frame to decide where to place a stop." If I trigger on the 1's I stop on the 5's. I'll read it over the weekend. Thanks.
Yeah but the evil-doers will probably know better next time.
P,
I agree with you that there are many ways to skin the cat, no argument there I will also won't take part in saying you are not profitable using your method, I'm sure you do well.
Now what I will say is that I think you must employ these "money management tactics", although we really know what this is, it just sounds very ugly if you say it
, because of your inability to read price action correctly.Anek
Anek,
Quite the contrary.....my success is based primarily on my ability to read price action. The ER2 takes dramatic plunges into extreme levels when stops are being hit and when they are finished getting run the instrument reverses. It happens again and again and again. It happened on the ES mid-day on Friday and I caught that one as well.
Unfortunately, a plunge in the market doesn't always reverse on the dime I want it to so it's necessary to take nibbles in key areas and build yourself into a position over time.
Quite the contrary.....my success is based primarily on my ability to read price action. The ER2 takes dramatic plunges into extreme levels when stops are being hit and when they are finished getting run the instrument reverses. It happens again and again and again. It happened on the ES mid-day on Friday and I caught that one as well.
Unfortunately, a plunge in the market doesn't always reverse on the dime I want it to so it's necessary to take nibbles in key areas and build yourself into a position over time.
Quote from Anekdoten:
P,
I agree with you that there are many ways to skin the cat, no argument there I will also won't take part in saying you are not profitable using your method, I'm sure you do well.
Now what I will say is that I think you must employ these "money management tactics", although we really know what this is, it just sounds very ugly if you say it
Anek
Hey look Profit Taking Fool, you have a friend.
The Perils of Momentum Strategies
Just letting everyone else know you're not crazy. I mean I know you're not, you know you're not, but there are a few folks here who aren't convinced.
The Perils of Momentum Strategies
Just letting everyone else know you're not crazy. I mean I know you're not, you know you're not, but there are a few folks here who aren't convinced.
P,
What prevents you from entering, taking a small loss, and re-entering ?
Why must you suffer the pain of watching losses get even larger as you get the correct area correctly ? You see this kills your risk:reward ratio from the start, whether you are making money or not.
If you combine pivots, volume divergence (for stop runs), and market internal divergence your accuracy in pinpointing these "tops" and "bottoms" would increase dramatically, give it a try.
Looking forward to your reply regarding the re-entry solution plus PA suggestion.
Anek
Quote from ProfitTakgFool:
A stop should <b>never</b> be placed below a horizontal level of support but that's exactly where they are.
Buying a lower low has a MUCH higher probability than a higher low but that view is based on my experience and I can't offer any evidence to support that so easy on the anger fellas
I have such evidence and you answered your own question.
The reason buying under support and selling above resistance works is because of the fact that people "like" to place their stops in those obvious places. Such stops are pyschologically comfortable and are therefore highly profitable to those who fade them. Also, note that placing stops at those levels assumes one has found the trend reversal point which, timing-wise, is a statistically unlikely thing to be able to call with any measure of reliability.
Fading such stops relies on a mean-reversion type event or value area completion event (per Market Profile) which both have high statistical likelyhoods.
For my own trading I use time based stops only.