Testing the ALL in and Scale Out or ALL Out Exit Stratgey

wintergasp said:
Hold on. So you're watching the screen pretending to trade and writing down how much money that makes ? What if your strategy only works for 6 months ? The only way you can know if your strategy is good or not is to push a button and see what it did over the last 20 years.

Try NinjaTrader, TradeStation, MultiCharts or even better some Python / C# reading a .csv of OHLC data.
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Thank you wintergasp.

Yes, this is what I have been doing, forward testing as my system depends on me drawing my own support and resistance level the day before trading.

I need to figure out how to automate me calculating resistance and support level from past historical data.

Thanks
 
Overnight said:
because you have lost sight of the goal.
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Thanks for your insight and response Overnight.

Can you explain what you mean by "because you have lost sight of the goal."

I definitely don't want to waste time and use my energy in a productive manner.

I agree with the pre determined target. You make a good sense.
 
profitlocker said:
If you can't numerically define S/R you won't be able to automate it
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Thanks profitlocker,

I am thinking about how I can back test. This will be BEYOND helpful for me, cause I am tired of forward testing cause its taking me forever.

I intraday trade the daily pivot points, open, close, high, and low on a small timeframe using price action in hopes of catching a momentum trending trade of the moment. I can somehow calculate these numbers from historical market data via some programs, I believe. I haven't written code in years, since college.

However, I also draw my own support and resistance just from what I see. But I am willing to leave this off for now if its too complicated.

For now, I just want to get a basic backtesting system for my backtesting environment. I have been forward testing for about 7 months now and if I have a new idea, its complex to test it with no automated way to do it.

Thanks,
 
SimpleMeLike said:
Hello,

I am sim trading a system with 3 CL contracts.

I have read threads regarding the ALL IN vs Scale Out vs ALL Out exit strategy. I am not sure which exit strategy I would like to use.

Therefore I will just test the best case.

Is my testing for exit setup correctly? I would like to make sure I am on the right path before collecting data.

Entry
All in with 3 contracts

Breakeven:
After trade moves X ticks in my favor. I bring 3 contracts to breakeven.

Exit Testing Setups:

1. All out with 3 contracts at a predetermined profit target price is reached. No trailing
2. Trail the 3 contracts by X ticks until predetermined target price is reached.
3. Exit 2 contracts at first profit target, exit last contract at a predetermined profit target price is reached. No trailing
4. Exit 2 contracts at first profit target, trail the last contract by X ticks until predetermined target price is reached.

Seems like alot of work, but I am not sure wish exit strategy to go with. All in and all out seems easier to me and simpler.

Any thoughts on my testing I will perform?

Thanks,
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First of all.. I have to really wonder if after you do your SIM trading, if you will really be able to trade 3 contracts of CL. This thing whipsaws like crazy and you can be down hundreds of dollars on only one contract in seconds. Assume it goes against you 30 cents... at 3 contracts, you'd down $900. So tell me... will all your SIM trading really help you when you got money on the line? I bet that once you start trading one contract, all your SIM trading goes out the window and emotions take over.

2nd part of the answer ties in with the first. It doesn't matter what anyone else here says because they have no idea how you enter and where. Simply put, if your entries have price going in your favor right away, trading multiple contracts and taking some off initially would be wise. But if your strategy shows you are initially always taking heat, perhaps buying all at once isn't the best. Scaling into your position might be the best approach.

But nobody here can tell you this. Why don't you do this, and either keep it to yourself or share here. Take your past 20 trades and just tell us exactly how much price went against you before it went in your favor for every single trade. If you find you're 40 or 50 cents ahead most of the time with price only going against you 10 cents, then you've got great entries and can easily load up initially and scale out. But if you're seeing that each entry goes against you usually by 20 or 30 cents, then why on earth would you go in for 3 all at once? You're focused on scaling out for profits, but you really have to consider how price goes against you right when you enter, and if you're in for 3 contracts and it goes against you right away, scaling out for profits isn't your first concern any longer.
 
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SimpleMeLike said:
Thanks for your insight and response Overnight.

Can you explain what you mean by "because you have lost sight of the goal."

I definitely don't want to waste time and use my energy in a productive manner.

I agree with the pre determined target. You make a good sense.
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Stand by, Simple...Need to gather my thoughts, and I see you be online.
 
One thing is fairly easy to see, in principle ...

If you routinely enter "all in" and exit "scaling out" from all your trades, then when things unexpectedly turn against you and you're stopped out quickly, you'll always take your losses with the maximum position-size open, whereas when things go unexpectedly well, you'll often have your smallest positions open at the time.

It's not easy to envisage this arrangement being the best, overall, for your bottom line.

(I'll declare my own "bias": I like adding to winning positions, because I feel that my wish to have a position open at those points has been strengthened by my entry already having worked out well so far.)
 
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