Stop Losses are killing me

Sequoia1321 said:
Been doing swing trading and have even tried day trading. Not very successful with either, though swing trading has been better. One thing I noticed is stops are killing me in both. Prices often go away but by that time I get stopped out. Been out of the markets for several years and came back to invest in the cheap oil prices. Noticed buying low and holding seems to work better for me, no stop, just investment. But wondering about getting into day trading. Again tried some swing and day trades but again keep getting stopped out. Wondering what I'm doing wrong. Maybe I should try scalping or more quick momentum trades, or scanning markets for major company moves and then try to trade the momentum. Little experience in scanning for stocks, mostly looking at mini S&P, which has been sort of a sitting game. For some reason don't like stocks, but I guess that's where the daily big news and momentum is going to be, while in S&P it's not always a daily event. But I hear there are algos that do these sort of quick trades better. At the same time I know some day traders are successful.
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Interesting OP.

I thought I was the only one been killed by automatic stop losses. That was a few years back. Since, I stopped putting stop losses and only used mental stops. Much better outcome. I do have to watch, read charts, news everyday to decide on the mental stops. Very time consuming compared to auto stops, but I am full time, have plenty of time to kill.
 
Trader Curt said:
Instead I use phone alert to tell me when a certain price has been hit, and then use my professionally trained judgement to determine if it's a market sell off or a fake out.

I save more money on stop losses this way, but when it comes time to sell because the market isn't moving up then my losses are bigger than normal. This is the price I would rather pay than dealing with being stopped out 100s of times.
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How can I acquire my professionally trained judgement?

I am not trying to be sarcastic, I want to know what process you went through.

Thanks.
 
bone said:
Now that’s a positive sign. That is real progress.

I’ve been trading a long time and I’ve worked with a couple hundred clients as well.

I hate generalizations in trading - but the traders that I’ve seen make serious FU money in this business since electronic trading took over have put a tremendous amount of background work into their trading system and position management. And they have the discipline not to repeat mistakes.

Even in the days of pit trading - new guys would stand there literally for weeks with their arms folded watching and observing.

Have a plan, and work your plan.

And it might be really tough to stay with a trade - especially in these days of Bot and Algo driven market noise and gamesmanship.

Don’t play to their strengths. I can tell you that one of the things I’ve done is trade smaller size and become a swing trader. I don’t want to compete with the Bots quite honestly.
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I understand the swing part, but why smaller size?
 
For proper legit Swing Trading - you are modeling longer timeframes and you have wider profit targets and stop-loss levels due to the larger trading range. I think that it is critical for newbs trying this for the first time to use the smallest sizing that they can find. Reason being - I don't want them to be anxiety addled. They need to allow the system to work and the strategy to play out as originally planned. Once they gain some consistency and confidence - levering up is quite easy.

Consistency is the one key. Once you gain consistency, then the worm will turn for you.

ironchef said:
I understand the swing part, but why smaller size?
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I think I will focus on swing trading (with smaller lots), and long term investing. I understand some people are good at day trading, but it takes lots of time to watch small time frame price action every day, which I can't easily do. For me it's easier to trade the longer term charts, that way I have time to analyze the charts and news unrushed, and also don't have to constantly watch the price action, just wait for the daily close or look at hourly charts from time to time, and in between I can do other things. And if algos and bots are a problem on short term price action then there is another advantage to longer term trading and investing.
 
Sequoia1321 said:
I think I will focus on swing trading (with smaller lots), and long term investing. I understand some people are good at day trading, but it takes lots of time to watch small time frame price action every day, which I can't easily do. For me it's easier to trade the longer term charts, that way I have time to analyze the charts and news unrushed, and also don't have to constantly watch the price action, just wait for the daily close or look at hourly charts from time to time, and in between I can do other things. And if algos and bots are a problem on short term price action then there is another advantage to longer term trading and investing.
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Decision Made :) stick to it, unless you find its broken later.

Constantly watching in theory if you can do it, you'll make more, but you'll end up insane and losing every trade pretty much as it's easy to lose the plot.

It's never easy :(
 
The best strategy I use for daytrading stocks is OTO with automatic trailing stops. I start with a wide trailing stop eg .60 to $1, then tighten up the further a winner runs.

I did that successfully today daytrading bounces in SDOW UVXY TZA.
 
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