Reverse the trade to get back loss

[doubledoubledoublecup]

Recently I was hit by the idea of "reversing the trade to get back loss" or "when you get stopped out it's the best time to reverse your trade"

Personally I had bad experience with such a trading strategy, it is not uncommon that the market would stop you out on high/low tick before going back to your original direction. But some trader seems to be able to improve daily win rate by doing it, and I read some Market wizard featured traders have used this strategy as well.

So often you use the reverse key, and is that part of your strategy? In what condition do you reverse your trade or is there any filters and rules you have for reversing your trade.

 

[zghorner]

Most of the times I have reversed I lost twice as much. You buy when you should have sold so then you sell when you should have bought...getting F'd coming and going.

 

[Zwaen]

A random-based exit will not become an edge-based entry

 

[murray t turtle]

Most of the times I have reversed I lost twice as much. You buy when you should have sold so then you sell when you should have bought...getting F'd coming and going.

%%
LOL, no wonder\bid -ask spread-slippage........................Add more[edit slippage] when it whipsaws. Maybe not exactly that bad LOL.
Add to the slippage+ loss \most any kind of turning point\lack of liquidity will not be kind to you LOL Even with SPY =liquidity leader\
wonder what less liquid stuff doesLOL??
NOT likely many or any J Schwager top traders use that;
one did use RSI =LOL.
I could use stopped clock 2x @ day.
Best way is trade % business of invest-trade or business profits; any kind of loss\ may pay to cut back.
Or if thrills is main goals keep max size + double down LOL [Thrills + blow up]
Good question

 

[BKR88]

Recently I was hit by the idea of "reversing the trade to get back loss" or "when you get stopped out it's the best time to reverse your trade"

Personally I had bad experience with such a trading strategy, it is not uncommon that the market would stop you out on high/low tick before going back to your original direction. But some trader seems to be able to improve daily win rate by doing it, and I read some Market wizard featured traders have used this strategy as well.

So often you use the reverse key, and is that part of your strategy? In what condition do you reverse your trade or is there any filters and rules you have for reversing your trade.

I believe @hilmy83 uses a stop-and-reverse strategy for his automated system.
https://www.elitetrader.com/et/threads/index-futures-automation.368144/

 

[doubledoubledoublecup]

A random-based exit will not become an edge-based entry

well, this is one of the reason I created this thread for discussion. Does traders here have an edge based reverse strategy that would improve their performance on a daily basis. Since the risk involve in reversing at a stop is much greater than entering a new trade, getting emotionally attached to the previous trade, the risk of the market whipsaws etc.

 

[murray t turtle]

A random-based exit will not become an edge-based entry

%%
Good rebuke LOL
Frankly my first year of trading, My P+L was amazing\not random @ all;
much\ much worse than SPY benchmark or much worse than random.
Another reason RSI or even PSAR[aka PTP] tends not to work very well;
say SPY market move much different up than down+ few bear funds profit much or last long @ all.
Add leverage + insures loss will be much more than cash markets.
Like Cash Coyne -Bright DayTrading Co noted ''leverage is a 2 edged sword''
Some do
Stopped clock may work 2 times per day but not 3 LOL.

 

[doubledoubledoublecup]

I believe @hilmy83 uses a stop-and-reverse strategy for his automated system.
https://www.elitetrader.com/et/threads/index-futures-automation.368144/

Actually this is one of the thread that hit me. I actually posted before, I personally known a businessman who trades just ORB. after tons of research he had done, the only way to play it successfully is by adding size on every loss, but taking huge loss from time to time is inevitable, And I mean so huge, that most retail would not be able to handle such drawndown because you still have bills to pay biweekly or whatever. So it would cool that the OB himself could explain how he keeps a low drawdown.

 

[ondafringe]

Recently I was hit by the idea of "reversing the trade to get back loss" or "when you get stopped out it's the best time to reverse your trade"

Personally I had bad experience with such a trading strategy, it is not uncommon that the market would stop you out on high/low tick before going back to your original direction. But some trader seems to be able to improve daily win rate by doing it, and I read some Market wizard featured traders have used this strategy as well.

So often you use the reverse key, and is that part of your strategy? In what condition do you reverse your trade or is there any filters and rules you have for reversing your trade.

If you haven't already done so, spend some time digging through @volpri 's journal.

https://www.elitetrader.com/et/thre...-trading-the-es-nq-ym-mes-mnq-and-mym.336259/

 

[doubledoubledoublecup]

If you haven't already done so, spend some time digging through @volpri 's journal.

https://www.elitetrader.com/et/thre...-trading-the-es-nq-ym-mes-mnq-and-mym.336259/

I did, one of the best thread I read for long long time.