Well...if your trading multiple contracts and the position is at a profit just prior to the close... Scale out (bank some profits) most of the position to compensate for any possible disaster in holding the remainder overnight that's news related. Me personally, no matter what time of the trading the position was opened... If by the end of the trading day or by the time I go to bed or is unable to monitor the position... If its not profitable...I close the position. Yet, if it is profitable and I think I will get more follow-through for whatever reasons... Lock in some profits...then I increase the chart interval for swing trading and let it ride on the remainders with a stop at either breakeven of 1 tick better than breakeven. http://www.elitetrader.com/vb/showthread.php?s=&threadid=52880&perpage=1&pagenumber=36 Chart at the above link: entry signal via 5min chart, pt1 via 5min chart but pt2 and pt3 are via 15min chart. NihabaAshi
Niha, I must disagree with you niha, what should matter for the decision is whether or not the expectation of the overnight hold is positive, not if you are green or red on that particular trade at that particular time
I strongly agree. In fact, the analysis had merited that particular day trade in the chart example at the link I posted...merited an overnight hold for its remainders as a swing trade. Thus, hopefully nobody assumed I said for every profitable day trade... It can be converted into a swing trade. Thus, very few of my day trades have merits to traverse the remaining contracts into an overnight swing position. Also...the thread starter did say this... Thus, I'm responding to the above as if something merited holding overnight whereas other types of day trades may not be suitable for overnight holds. Once again...the final criteria for traversing from a day trade into a swing trade is if I was able to bank some profits in those first group of contracts prior to the close. Now...as for trading instruments like Forex. That's an entirely different story. No day trades can be converted into a swing trade. A position that's open as a day trade is closed as a day trade. NihabaAshi
I'll hold indexes overnight unless the trade is a loser near the close, in which then I'll usually bail. Of course then it always seems to be that if I held I'd at the least get a chance to get out even the next day.