Setting stops on longer-term trades

[dozu888]

Have it all on automation as a way to stop mucking it up, stay will system traded decades, I have used same concepts 28 years. The opening position shows greatest "mean" losses, back test best or longest number of days to be at risk, so when system reaches so many days, if profitable, stop loss goes to breakeven plus little, if at a loss, new target is better than got in. Once at breakeven plus, use zero trailing stops unless price patterns show time for retracement or change of trend. System uses hedges as it is often very early, like the Indexes, continue to be short futures, system staying short, hedged all long dividend paying stocks.
Have found trailing stops for swing or longer term often produces fake moves, once at "BE+1" stops, need reasons to change it.

The market doesn’t even known where your break even is lol.

stops are a psychological crutch. It gives the trader no advantage whatsoever.

 

[qlai]

Why run a stop at all? A far out stop will probably get blown through in a black swan (the situation that would cause you to sudden evaporate that cash without noticing). Any smaller losses you'd see just monitoring it.

Agree 100%. Beyond swing trading, hard stops don't protect you. Have a mental stop if you want and if hit, decide what to do. Proper position sizing is your stop. I can only imagine the pain people felt during the flash crash when they were robbed of their stocks.

 

[fan27]

As a long term investor why not just tell everyone on ET your averaged in price, that way they can either root for you or empathize with you?

As one of the principle QQQ Fanboyz I am not sure why you didn't get the latest memo from the ProBoyz, they said not to buy any QQQ this coming week because the market is going to shit itself after getting gut punched being that the stimulus numbers are out but USA death tolls are rising - upside known - downside unknown.

They said the shake will end towards the end of April so don't pull out your index pooper scooper just yet.

Cheers

dozu888 and his "ProBoyz".

 

[ironchef]

The market doesn’t even known where your break even is lol.

stops are a psychological crutch. It gives the trader no advantage whatsoever.

Agree 100%. Beyond swing trading, hard stops don't protect you. Have a mental stop if you want and if hit, decide what to do. Proper position sizing is your stop. I can only imagine the pain people felt during the flash crash when they were robbed of their stocks.

Based on my own painful experience putting stops on FB, GOOGL, AAPL... which I was planning to hold for more than a year was a disaster. Knowledgeable people simply drove the stocks down and picked us off those stops then move the stocks up quickly way beyond those stops. I am seeing that happened to BA, folks that put a very "wide" stop at $100 are all regret it now.

Day traders need stop, absolutely, short term swing needs stop for sure but any other trading styles need to be very careful.