How to decide what amount to put in the traling stop for ARCA order? Can not find how ARCA program it. Anyone is using this type of order to let the profit rides? It is only good for the same day & so is the regular stop order.
Z- I sometimes use a trailing stop after my initial target has been met and it seems the market is still strong in my favor The amount I use depends on the stock(volatility, share price, etc.)
I am a swing trader & just began to use level II last week for the ARCA stop order feature. After my trade if it is going the other way I use stop order. If it coming my way I wait until it reaches a certain profit margin then I place a trailing stop order with intend to ride with the profit. My problem is I do not know how real tick program the trailing stop order, my stop is too tight. Do not know how often (or what basis) it samples the price to trail from. Figure there are many knowledge traders here, will know the answer.
I think the ARCA trailing stops trigger from the bid/ask quotes and not printed price. For example, if you're long and have a trailing stop order placed, the stop will follow the bid. If you're short, the stop will follow the offer. The reasoning is that this is what you'd have to pay to get out of the position (based on a market order or if you were going to pay the spread). After the triggering of a trailing stop, a market order is placed. Using RealTick (and maybe other programs), you can see the stop price update by having your Order Book up on the screen. One word of caution with ARCA stops (i.e.- market, limit, trailing): I have had some problems with the stop function working properly but once triggered I've had orders cancelled due to some inapplicable property. I can't recall the details, but I think that one was cancelled because the order type was DayPlus & not Day. Just be cautious until you've used a few.
I was told that trailing stop oder is only good for day order. It shows the action & will bring up the order book by itself. I have a hard time to understand what price it based on to trail, that why i post here to find out the answer. It is a wonderful tool if I understand better. Can not find out in ARCA or real tick site. Help is really needed here.