Moving Stops to Break-even

J

John9999

I seem to have this issue of that I want so bad to move my stop to Break-even and then have a "free ride"... I trade the NQ Emini and have typically moved my stop to $0 loss at +12 points (48 tics)..

I have read and read that this is a losing deal, but I cannot seem to shake off the urge to do it. Today is a PERFECT example of why not to do it. I went short 5 mins before the open, got to a break-even stop and got taken out with no loss. The trade went on to what would have been close to 100 points for me !!!

anyone else struggle with this?
 
Do you have a rule that outlines when you move a stop to break even? If so, then you either followed your rule or you did not. If you do not have a rule, you really should, otherwise you will continually find yourself in your current situation.
 
You always need to give some space to your trade so that he can develop. So you should put your stop not to close. Only when you see in your system that your trade is reversing you can interact.
Do some backtests to see where the optimal stop is, to catch the good trades and not catch the big losses. The backtest should answer your question.

To take the profits you will have to accept losses too.
 
yes,, my rule as mentioned is to go to BE at =12 points.....

I totally agree that my 12 points means nothing to the market..... I guess then If I went by some multiple of ATR that would be a decision based on the current market condition at point of entry
 
John9999 said:
I seem to have this issue of that I want so bad to move my stop to Break-even and then have a "free ride"... I trade the NQ Emini and have typically moved my stop to $0 loss at +12 points (48 tics)..

I have read and read that this is a losing deal, but I cannot seem to shake off the urge to do it. Today is a PERFECT example of why not to do it. I went short 5 mins before the open, got to a break-even stop and got taken out with no loss. The trade went on to what would have been close to 100 points for me !!!

anyone else struggle with this?
More...
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Yes, especially when the 200 day moving average has held,QQQ, so well this year-but good thing about moving averages, its hard to cheat with them so i dont.I like PSAR also, but that can be so wrong for long i use more discretion with PSAR. I'm reasonably sure QQQ will be up in NOV; but i did not want to risk a break even, or close to it,which would be a loss for me.:cool::cool:
 
Am working on new system for markets that tend to run like Nasdaq, Russell and Crude Oil, the protective stops are based on volatility, so they can change each hour. What tests out well for me is whatever is the stop, as soon as profit equals risk, lock in 2 ticks, let someone else pay my fees. Also, just cause you entered once, on other retracements, add to running position as this will make up signals where you get nada. But of course, you should check your back testing, always.

I don't look at breakeven as a loss, who cares if I have a dozen breakevens for the day, we forget that if we didn't, we could have loses. Our eyes usually not trained to look for the bad parts of charts, more likely the good patterns. Concentrate on having a smooth equity curve.

Good trading to you.
 
John9999 said:
I seem to have this issue of that I want so bad to move my stop to Break-even and then have a "free ride"... I trade the NQ Emini and have typically moved my stop to $0 loss at +12 points (48 tics)..

I have read and read that this is a losing deal, but I cannot seem to shake off the urge to do it. Today is a PERFECT example of why not to do it. I went short 5 mins before the open, got to a break-even stop and got taken out with no loss. The trade went on to what would have been close to 100 points for me !!!

anyone else struggle with this?
More...

I think we all struggle with stop placement ... until we use optimization/backtesting software of some sort to find a "definitive" answer.

While your example shows the downside; I'm sure there were, and will be, times where your break-even strategy helps your bottom line.

We can't really look at one example and draw a conclusion. You'd probably have to backtest/compare/contrast your break-even strategy vs. other stop-loss strategies before drawing any meaningful conclusions.

Keep us posted.
 
John9999 said:
I seem to have this issue of that I want so bad to move my stop to Break-even and then have a "free ride"... I trade the NQ Emini and have typically moved my stop to $0 loss at +12 points (48 tics)..

I have read and read that this is a losing deal, but I cannot seem to shake off the urge to do it. Today is a PERFECT example of why not to do it. I went short 5 mins before the open, got to a break-even stop and got taken out with no loss. The trade went on to what would have been close to 100 points for me !!!

anyone else struggle with this?
More...

Hello John9999,

It is nothing wrong with bringing your stop to break even once you in the profit by X amount of ticks if and only if you have a logically/technical reason for bringing your stop to breakeven.

No, I don't struggle with bringing my stop to breakeven, I struggle with exiting too early.

Also, if it makes money, it makes sense.
 
tiddlywinks said:
Increased volatility + Money-based stops = your example.

> Use structure based stops. 48 tics means nothing to the market, only you.
> Learn to bank and reenter. 100pt (400 tics) move and no (re)entry point? Back to the drawing board if that's true.
More...

Good point tiddlywinks,

I 100% with this right here. "Learn to bank and reenter" That is something I am working on right here.
 
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