In another thread, someone had a link to an article that talked about fish and ponds and related it back to trading. One sentence from this article caught my eye. While talking about trading from the daily charts, the author said: "Can you handle the big swings in price? Can you watch your stock drop 3 points, while waiting for it to gain 9?" This concept has been perplexing me lately. If I enter a position which drops 3 points, doesn't that mean my entry was wrong, regardless of whether or not it gains 9? I think the key is to enter as it's gaining 9, not as it is losing 3. This also goes for the loose stops theory. Setting loose stops so the stock will have some room to move before going in the desired direction seems like an acceptance of a less than optimal entry.