I use sell stop limit orders. Yes re scaling any size because often there's midday or end of day reversals like today's eod runs up in inverses SDOW TZA etc. It's more work, true, but it's one of my edges, alot of tiny trades, tight stops and re-entries with scaling. It's my biggest lesson learned in 21 years. Back in 1999 I'd do just several 300 share trades at a time, with expensive stops. Now I give myself more chances to profit using tiny stops. My best recent day I was up 2k. Starting small then scaling
I have the same approach buying 25 shares step by step, see the bottom and buy more till it gets more juice. Buying when it gets down .5 -1%% iteration. Worked all these years, if mistaken (news and other crap) I’m catching way back. But you have choose swinging stocks, not etf because less momentum. F.e. GOLD barrick mining co., btw great company but stuck with gold. Sometimes I am very conservative and missing big fish.
Although it must be said overall scaling in winners much much harder on the short side than the long side as short trends are probably 1/3 the time frame of long trends .
I can see the advantage of scaling in. I do that myself. I can also see scaling out at a profit although I don't do that. Scaling out at a loss is something I have trouble wrapping my head around. Today I took a small position in SPXS after 10 am when it started to show some strength. I would have scaled in if it had of moved in my direction. Placed my stop at $10.30 that was eventually hit. I was wrong. lost less than .25% of my trading capital. I took the loss as planned and we'll see what tomorrow brings.
How would you define the “react” Time frame wise market dropping as Defined by how many days, percentage ? Etc etc at what point do you conclude your reacting? Or perhaps what the measure ? Or does it not matter ? In the sense that everyone measure is different based on their style ? And their own time frame ?