I know many frown upon it. I usually do, as it saved me many times. Although it can stop you out of otherwise good trades. Mostly has been a good thing for me. Its almost an art form as to where to place them. I did not use one yesterday and i got pretty slammed. Bear in mind, these are day trades.
Stop loss is an art that define what I feel I can give back to the market in order to obtain what I want from the market in case of eventuality. The bottom line is the art of giving before you can receive. QED.
stops are for losers that have no plan how to defend a position but the above will not work either if you don't pick a extreme point of entry holy grail dropped at your feet
To avoid your stop loss being hit, you must have a strategy in place that will help you define that exact point where you need to do just that. Let me shock you, out of 199 trades, only 2 of my trades was hit by stop loss to date. Check one of the charts here!
do as i say not as i do that is a general public use system for high performance trading like this i have no stops only a plan but if do have to use a stop make sure it's logical for the system your trading that's where it just takes years to understand and master what stop and profit target go with what entry method. there are zillions of ways to master a market but you have to find the one for you. ---------------------- the system that is on oddball site uses a fixed profit target and a fixed stop limits trading to 1 trade per day and the trade has to occur within the first 120 minutes of the open or there is no trade for the day. it's simple and effective but completely opposite of what i trade myself. how did the pack of misfits do today trading? @demoncore @Ricky Roma @S2007S @Actuarial_Fun @EdgeHunter @nz_melon @DarkerthanDarc @TrailerParkTed @piezoe @gwb-trading @El OchoCinco @Monobrowtrading @SunTrader @Windlesham1 @deaddog @Tuxan @Atlantic @newwurldmn @cesfx @newbunch @nbbo
There is an easier way to find where to place your stops. Sell vertical spreads, the boys in Chicago will work out prices for you and tell you where you have likely fucked up.
options are for the self proclaimed god of options @demoncore and his band of followers who probably just got killed in the market and headed for the highest building with a open window. how would you like to have been short naked calls? even for that i have a plan to defend and i don't even trade options these days. no need to trade options if you know the direction.
Most of us have done this as well, until we learned the hard lesson. All I can say is to print out the following and stick it next to you monitor, and start developing habits like a businessman and not like a gambler. "Capital preservation is the most important thing. If you’re not cutting your losses, you’ll never survive in this game. The markets can be brutal to the undisciplined." ~Marty Schwartz~ "If cutting your loss is a difficult decision for you to make.. then you're a rank amateur, because that's the most basic mechanical part of trading, and the decision should already be made beforehand. Without it, you will never make consistent progress and you will blow up." ~Mark Minervini~ "You always want to be in control, never wishing, always trading, and always first and foremost protecting your ass." ~Paul Tudor Jones~