Find a spot on a chart. Say to yourself “it doesn’t make sense for me to own the stock anymore if it goes under here.” Build your position size accordingly.
Stop Losses 101
- Thread starter Dollardogs
- Start date
Ready to Test that DDog Trading Plan v1.0 out?
Load up a 5-Minute MSTR chart.
What's v1.0 do on Your 5-minute MSTR chart during trading sessions for Thurs Feb 18 and Fri Feb 19.
Post a pic, it'll be interesting to see if it gives you any clues toward an exit strat.
Break a Leg.
My humble system doesn't work as well on 5 min charts. Here's a couple entries and exits on the 1 min charts for 2/18 on MSTR. Green arrow is open and red arrow is close with a dotted line for stop loss. Don't understand why yet but when I use the 5 min chart, I miss too much of the move waiting for a trigger candle, and the risk/reward ratio shrinks enough to scare me off.
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Looking Good.
Now it's time to go out and find ...
Ten examples where your DDog v1.0 Entry / Stop prototype Setup Does NOT Work.
Tally the number that Do Work, while you find those Ten Non-Working.
You gotta Get You an Exit Strat, holmes.
Your exit method -
What would a written rule for that look like?
And work outward from there.
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Out of curiosity, what is the price difference between the Entry and the Stop in this Trade below?
Entry on this short is around $922 and exit is around $913, so 1% move thereabouts.
"Entry on this short is around $922
exit is around $913
, so 1% move"
Ok, and
What is the Stop Loss's Price?
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Stop Loss = 927
Entry Short = 922
Hypothetically,
Assuming an Account Value of $100,000 for simplicity,
For this Trade How many shares would you Enter?
Entry Short = 922
Hypothetically,
Assuming an Account Value of $100,000 for simplicity,
For this Trade How many shares would you Enter?