I've still got a lot to learn. This video is relevant to the subject. http://www.cmegroup.com/education/developing-your-trading-strategy.html
Thanks for advise. -You mentioned ART trailing stop order. My query is how to set a proper volatility tolerance? What steps I should do that can take me to a right number? -What is market profile? Do you have any picture or sources I can refer to?
Simply put you can take any average volatility-measurement and choose which number to multiply with. Ie. 3xSTDDEV or 4xATR added/subtracted to the average has statistical meaning about probabilities. Bonus if you do this in log-space instead of linear numbers to account for percentage growth and declines, and avoiding negative price levels. Be prepared for psychological devastation having to ride out swings in the markets, and learn to cope with that.. Also learn to cope with inevitable losses and failures, there are NO "right numbers" per se. Just search for: volume profile and action market theory No source will tell what you need to research yourself, just provide tips and pointers. In fact, be very wary of already-defined solutions to your problems. You'll have to do the work yourself..