Registered: Jun 2011
03-14-12 03:20 PM
this is going to happen to you for the rest of your life until you incorporate a sound money management program which is not based on market price.
Quote from ziyan:
I'm still a novice trader. The market has been very good to me for the most part, but I keep getting shaken out of highly profitable trades prematurely (2nd straight time this month). I use discretionary stops based on daily profit loss percentages to around 2.5% (?which is substantial?)
Here's my most recent trade:
SZYM BOT on 3/7 @ 11.88 (knife-catching? crap, I know. sorry guys! Thought I saw good support from previous periods)
3/12: Gap up @14.18, breaks 14,
breaks 13.80, I type in my order,
breaks 13.75, I brace myself,
breaks 13.70, I vomit. and hit the sell.
SOLD @ 13.65
4:00 pm closes over 13.90. I curse the world.
Today. Closes over 14.43. I am too chickenshit to get back in saddle. (trading on cash acct w/3-day settling) and I curse the world some more.
Now part of me pats myself on the back for making a profitable (albeit riskily initiated) trade. The other part kicks me for being a slight wuss in a bull market and not using wider stops. And of course, I always kick myself for trying to catch the falling knife so often.
Can I please get some feedback on this trade?
Any & all constructive criticism appreciated.
Thanks so much!
A good system will usually give back 30% of any move. So,when you look at your highwater mark, don't forget to minus out the 30% you should give back.
nothing wrong with catching falling knifes, nothing wrong with closing out early, and really, nothing wrong with closing out late.
put it all in context of your money management system, then, what you are now devoting 100% of your mental energy to will only require 10% of your brainpower.
you already have a good starting point. You know your money management system needs to avoid PDT.
If possible, take some time off and do some testing using random entries. Once you get a random system that will break even minus the spread and commissions you are ready to go live.