Would you stick to your trade even when a loss seems imminent?

[bone]

My trading is completely different. In the Pit, scalping volume varied, spreading was fewer trades than scalping but much greater volume.

Screen DAY spread trading in the late 90’s and early 2000’s was the most futures volume I ever traded - there were months where I traded 300K-500K R/T’s in Eurex and LIFFE.

With swing trading - I am modeling much longer timeframes, I am targeting much bigger chunks of trading range, I am trading much smaller size, and execution commissions are inconsequential. Totally different mindset and approach.

How many trades were you taking per day on average when you were in the pits? How different is you trading now?

 

[easymon1]

say you enter a trade given by a signal/setup and have your profit and stop orders attached

What timeframe charts do you like to trade?
Out of curiosity, what type of system - momentum, reversion...?

 

[cesfx]

Stick to the plan, not to the trade.

 

[virtusa]

In a good system, the stop is the optimal place to take the loss. Beyond the stop your system should lose more money than it can generate in the few trades that still get profitable.

A trade needs room to develop, so taking a loss too early to avoid a potentially bigger loss, is impacting performance in a negative way.

The place of a stop is where the probability of losing money is bigger than the probability of making a profit.

 

[Amatrue]

What timeframe charts do you like to trade?
Out of curiosity, what type of system - momentum, reversion...?

I trade price action and patterns on the 1 min and 5 min charts

 

[themickey]

To me this is very much linear thinking. When the opportunity arises you go in big, if it is unclear you stay small etc. etc. Also I guess it depends on the system you employ, and the type of trader that you are.

I find the opposite, the greater the certainty / the more obvious the look and feel of a potential trade, the more it backfires.
Going "in big" is a discretionary decision, I know of no mechanical methods coded to 'go in big'.
I trade a simultaneous mechanical and discretionary system.
Mechanical: Algo creates the signals, Discretionary: Fine tuning of the best signals.
And even then the trade can go wrong, larger the trade, greater the loss.
It's those less obvious trades which appear the most profitable.

 

[Heydrrich]

I find the opposite, the greater the certainty / the more obvious the look and feel of a potential trade, the more it backfires.
Going "in big" is a discretionary decision, I know of no mechanical methods coded to 'go in big'.
I trade a simultaneous mechanical and discretionary system.
Mechanical: Algo creates the signals, Discretionary: Fine tuning of the best signals.
And even then the trade can go wrong, larger the trade, greater the loss.
It's those less obvious trades which appear the most profitable.

I am not trading signals I am trading my equity, different signals and thereby different bet size adjustments is a thing (to me). Personally I am opposed to the idea of having a fixed bet size, it makes no sense to me since markets are not rational.

 

[virtusa]

the more obvious the look and feel of a potential trade, the more it backfires.

That's funny. If something looks good you have worse trades then when something looks bad? So you have to trade things that are not obvious and that don't feel good?

I have exactly the opposite experience.

The clearer the signal the higher the probability it will be a winner. The only thing I cannot, is estimate the size of the move when I get in. I have to follow continuously the move to get out at a good place. But in general I manage to do that.

It took me years to get from the basic system to the fine tuned one. Even had to throw out algorithms or logic that I used, to replace it with better things. Each adaptation (after using it a long time) was a heavy task as my brain (for the discretionary part) was more or less programmed to stuff that I suddenly had to delete. I each time had do re-educate my brain to do something else.

 

[virtusa]

markets are not rational.

But markets have patterns, they react in ways that can be mathematically deciphered more or less and with enough probability to make money with a system that has a positive expectancy.

There is some kind of "rationality" in it.
When I watched a chart the first time in my life, it looked like all I saw was noise. There was no logic in it.
First time using MA's I started to see that part of the chart was less noisy. I saw at least some times a trend. Over the years, and after finding more and more "indicators", the noisy part of the chart was shrinking. Now I control my trades well, and the parts that are still noisy are most of the time somwhere in the trade that I can just let it run till it gets clear again. All this without being stopped out all the time.

 

[murray t turtle]

say you enter a trade given by a signal/setup and have your profit and stop orders attached, then price action begins to go against you and you believe you are likely to be stopped out of the trade. Would you close your trade or wait for it to hit your stop?

I understand that manually closing a potentially losing trade makes your stop redundant, but sometimes when something unexpected happens it feels like additional loss on the trade could be prevented.

%%
Almost NEVER close your stop early; that goes against a well tested battle plan Amatrue
OF course if it the least profitable ETF in your account /kick it out even with a profit.
ONE exception to that; if you are in FAZ or FAS+ then the FED makes a major move/GET out asap.LOL/true
''Feels like an additional loss could be prevented.'' Feelings are so often wrong/what about feelings when you dont have a plan + then after you chicken out/the trade turns+ turns profitable?????