Fellow traders,
Please take a look at the enclosed chart.
Lets say we are short 1 contract on 38 (line 1), stop is 4 ticks
What is the target going to be and why:
Target line 2 at 31 for a potential profit of 7 ticks
Target line 3 at 22 for a potential profit of 16 ticks
What factors would you weigh in the selection of the target, any ideas about the relationship between the probability of hitting target line 2 or 3.
The goal is to maximize EV / profit, not hitratio.
I look forward to reading your opinions.....
Please take a look at the enclosed chart.
Lets say we are short 1 contract on 38 (line 1), stop is 4 ticks
What is the target going to be and why:
Target line 2 at 31 for a potential profit of 7 ticks
Target line 3 at 22 for a potential profit of 16 ticks
What factors would you weigh in the selection of the target, any ideas about the relationship between the probability of hitting target line 2 or 3.
The goal is to maximize EV / profit, not hitratio.
I look forward to reading your opinions.....