Trailing stop MUST be outside the recent reaction high/low. If the market never makes a reaction high/low the stop does not move.
So if the reaction low was more than 20 points, you would place the stop that far out which could result in a winning trade turning into a loser ?
Ok, help me out here. Say I have a full position avg short on from 1393 right now in ES. Where will my trailing stop be at this point in time ?
I see. You can determine this at the moment you place the trade, right? For any particular trade? Good Lord.
Wow this thread keeps getting longer going nowhere. It will rival the "trendfollowing delusion shattered" thread quite soon at this rate. B1S2 trades his long-term technical "trendfollowing" methodology (aka "hope I got lucky and fundamentals agree with my position this time"), everyone else trades everything else, and never the twain shall meet. You'll have better luck in the Religion and Politics forum for seeing someone change their minds.
Certainly! The market must show me obvious reversal or if I was using a profit target must hit that target. I have been riding the ES up from Mid June except for 20 points in exactly that fashion. (I missed roughly 20 points while I was tinkering with the day trading). The trade became profitable but until the market made a new reaction low, my system told me not to move the stop into the noise. That is how you ride trades long term.
If I had a full short on in ES, the stop would be above the reaction high of 1398. The stop would be set at your comfort level according to your account size.
I've seen many traders go broke letting winners turn into losses. But if it works for you, more power to ya.