placement on stops

Discussion in 'Technical Analysis' started by lasner, Sep 22, 2005.

  1. lasner


    I was trying to see were you guys place your stops, what percentage of your account. If you prefer to use options to hedge with instead of using stops.
  2. Hi Lasner - I've been running tests on TradeStation and have found that I can greatly increase my returns if I implement a break even stop - once the trade moves in your favor by a certain amount, set the stop to BE.

    Good Luck!
  3. fstrader


    I think it depends on your style of trading, what type of gains you are looking for and the stock's volatility.

    One thing I found is that you should never place your stops right before levels of support. Lots of people buy high and then as the stock falls back to test support, they sell. Then they get upset as they watch the stock move back up.

    Personally, I like to look at previous support and resistance and I look at Fib levels. One thing I try to do is not to set the stop above the 50-day EMA. If the stock closes below that, then chances are, its done. But a stock with strong RS will more than likely move up after testing this.
  4. lasner


    What about options. Do you ever use these to hedge with and not use a stop. They're great for tax write offs.