I am just moving into the emini futures market and finding that my methods of closing out a losing trade sometimes backfire. What I have been trying to do most of the time is post a bid or offer and hope that it gets "hit". Reason being that I dont want to pay the spread. Today again I find myself doing really quite well and making money only to get into a losing trade and then post the bid or ask to get out and have the market keep going away from me. So the open question is when your in a losing trade do you just put in a market order to get out NOW or perhaps put a limit order in at a marketable order? Seems like when I put in a market order I get hit harder than I should ( again based on the emini) Am I being penny wise and pound foolish for trying to get the spread instead of paying it? Thanks in advance
market or limit order is not a determinant for your trading success. you are successful trading eminis when you can correctly predict the number of future direction that you had traded.
I ALWAYS use a market order when trading ES and NEED to enter/exit. The other times I may try and bid or offer. If you can capture half the spread on a round turn you've done well.
If prices blow past your stop (mental or otherwise), quickly. Market order. With experience, you could exit earlier too, if you clearly sense a turnaround. Just take it, and wait for the next trade.
I use my index finger. If that fails, I sometimes use my forehead. Now here is my soapbox on the issue at hand: http://www.elitetrader.com/vb/showthread.php?s=&postid=76702&highlight=spread#post76702 This thread also talks to the issues: http://www.elitetrader.com/vb/showthread.php?s=&threadid=6048&perpage=6&pagenumber=1
1Reason, what you are doing is really dangerous I tried it (I still had an actual stop somewhere though) I know it can kill you , here is what I do sometimes. Post you LMT at whatever price you want : even, a tick above even,last support broken on the way down , resistance on the way up (although that's a bit crazy for me ) but still enter a hard stop where you really want to cut your losses ( for me 3-5 points). Now most of the time I exit at the market hopefully even or with a tick if after 2-3 minutes the trade doesn't show signs of working out.
"by any means necessary." <a href="http://www.brothermalcolm.net/brothermalcolm/photographs/index.html"> <img src="http://www.brothermalcolm.net/brothermalcolm/photographs/3/009.jpg"width=166 height=230></img></a> <font size=1><i>1 Cor. 8:6: yet for us there is one God, the Father, from whom are all things and for whom we exist, and one Lord, Jesus Christ, through whom are all things and through whom we exist.</i></font>
yeah, if you are truly thinking in your head "this is a losing position" then you just have to go market. Otherwise you just have to let it do its thing until it hits your stop. If are trading without a stop then you have a bigger problem, since you have no objective way of deciding when you are wrong.
You need to think in much bigger numbers than 1 tick on either a stock or an Emini.....and simply get out. A single move of a point or more can happen quickly and you will lose many times that "spread" you refer to. Traders need to "initiate" their traders...rarely post a bid or offer "hoping" someone else with help you out...think about, you're going against momentum for specific moment. When someone takes out your offer, you probably could've made more by waiting. We generally "hit bids" and "take out" offers in all of our trading. Don