I've had to do a rethink of stops lately. As a beginner years ago, I would sometimes increase my stop in an attempt to let the market have time to see the wisdom of my entry. Got over that. Then reached a stage of letting stop sit till trade went right or hit it. Now, tend to exit trade early if anything just does not look right. Idea being, as you have stated that most good trades are good from the beginning, and I can always reenter a trade if the setup firms up. At least I have my money in my pocket and another trade just around the corner. I suspect this must be a common progression for many traders. FWIW.
I, I suppose the first question I should ask you is how are you doing with your current system/methodology ? When I traded equities I slowly drifted into SPY/QQQQ and then finally futures. Yes, Suri's book is exceptional, can go wrong. Anek
B, Sounds great, I get the impression your trading skills are transcending. It is no myth that the best trades work from the start, it's just the way it is. Anek
Great Post bro, I used to wait for the market to catch up my intelligent entry so they could see why I bought or sold and then do the same. then I would wait for stops and accept getting stopped because it was calculated loss right. the beauty of it is, when you exit before your stop gets hit you preserve more capital. you trust your instincts and when you exit before you stop gets hit and then...... price reaches that stop, its almost like a winning trade (psychologically that is) because you did the right thing you got out of a losing situation and you have money in your pocket ready for the next (or existing) setup to fortify. I used to get pissed but now realize the next setup is right around the corner. so..... hold on to your quarters and wait for the next peep show =)
Anek, I can really see how those painted bars can clear things up. Good job. I'd like to figure out how to do that in Quote Tracker. Seems that your tight stops are mostly based on previous bar. Yes -- confidence indeed. But I'm starting to understand your confidence. If going short, and you don't see bright green bars that often, that's a good sign for that tight stop. Am I far off? -Tech
I am doing well with my methodology however it's not a very comfortable one for me risk wise as I try to scale up my trading. As is probably obvious from using an avging down strategy I do sustain occasionally decent sized losses up to 2x my average positive days. I'd prefer to move in a different direction that is more tailored to my risk aversion psychology. Being part of a Prop firm, I use the firm's money so it's a low risk endeavor for me. Since I can only trade stocks there - no futures - and i do enjoy the diversity of the action, I was hoping you'd have suggestions on how to target stocks using AHG or some variant thereof. I suppose I can certainly trade the Q's or SPY as you have in the past though I was hoping you might have insights on an approach that could target a larger variety of stocks. Thanks!
Tech, It really depends on the type of play. When scalping, the stop now must not be the same as it was 1 sec ago but based on what's happening with price right at that precise moment. All stops must be strategic and trailed accordingly. Preservation of capital while allowing the play to fulfill itself is the path to glory. I rarely sell or cover, I'm usually stopped out. Anek
Anek, That price.action.pasta chart is gold. Did you make it up afterwards or it is real trading record? ne of my problem is the chart looks crystal clear with hindsight, but with real time, I am more often got confused. Thanks, freewilly