Hi
I am currently working out where I'm comfortable to stop if a trade goes against me, I've broken it down into ranges, what do you guys think? Is it too tight do you think?
1.01-1.99 10 ticks
2.0 - 2.98 8 ticks
3.0 - 3.95 6 ticks
4.0 - 5.9 5 ticks
6.0 - 9.8 5 ticks
I rarely trade over 10.0 and if I do then I make sure the stop is not more than 3 ticks
I will loose a few more trades like this but in the long run save myself from a big hammering
What do you think?
Thanks
Adam
Stop Loss
I only exit losing trade's when i think i have got the entry badly wrong.
I realise this is a skill to learn
but to me Blindly taking a loss at fixed number of ticks doesn't really make any sense.
There are times where a trade may go 5 ticks against you, but all the signs say it will come back and you dont want a stoploss to automatically cut in at the worst possible time just before it returns to you price..
but then there are also times when you might panic at a red of 1 tick and then why wait if you know it going against you badly
.
take control for yourself is my advice.
I realise this is a skill to learn
but to me Blindly taking a loss at fixed number of ticks doesn't really make any sense.
There are times where a trade may go 5 ticks against you, but all the signs say it will come back and you dont want a stoploss to automatically cut in at the worst possible time just before it returns to you price..
but then there are also times when you might panic at a red of 1 tick and then why wait if you know it going against you badly
.take control for yourself is my advice.
Thanks Freddy, I have a good feel for it myself and I too exit if I am wrong with my entry but there has to be some limit in place don't you think? All the signs may be there and many times it may come back but there are times, daily, that it will keep going the wrong way so just wanted a gauge on how far people let things go before stopping out
Thanks
Adam
Thanks
Adam
Adam
You might want to consider the bandings too..there are good points and bad points to enter a trade
ie at 3 (For example) there is a 0.05 tick upwards and a 0.02 tick downwards...so in theory you could lay at 3 and of it goes against you you lose 0.02 and if it goes for you you gain 0.05; its all about long term edge..
Just look at a football game tonight and see the money accumulate at certain points
regards
Peter
You might want to consider the bandings too..there are good points and bad points to enter a trade
ie at 3 (For example) there is a 0.05 tick upwards and a 0.02 tick downwards...so in theory you could lay at 3 and of it goes against you you lose 0.02 and if it goes for you you gain 0.05; its all about long term edge..
Just look at a football game tonight and see the money accumulate at certain points
regards
Peter
When I started out, I thought stop losses were a great idea. That's because I lacked confidence as a trader, my entry points were sketchy and I got very nervous when I saw reds appearing on my screen
However, now that I'm an experienced trader, I have come to the conclusion that having a rigid stop loss of x amount of ticks is a complete disaster, it will kill your bank!
Good traders will use their skills to scratch a bad trade when they feel it's time to get out. Many markets have temporary gaps. If you set up a 5 tick stop loss you will end up with many unnecessary red screens, if you have a 10 tick stop loss then you need to hone your trading skills, because if you're sat waiting for ten tick losses before recognising that this trade has gone wrong, then the chances of you succeeding are slim anyway
However, now that I'm an experienced trader, I have come to the conclusion that having a rigid stop loss of x amount of ticks is a complete disaster, it will kill your bank!
Good traders will use their skills to scratch a bad trade when they feel it's time to get out. Many markets have temporary gaps. If you set up a 5 tick stop loss you will end up with many unnecessary red screens, if you have a 10 tick stop loss then you need to hone your trading skills, because if you're sat waiting for ten tick losses before recognising that this trade has gone wrong, then the chances of you succeeding are slim anyway
Guys, regarding the stops, if I was backing to lay and the selection I back goes from 1.7-1.8 for instance are you saying I shouldn't wait for it to get to that? I've noticed a lot of these turn around so I'm not sure what's best. I read a post from Peter on here before and he said that the average swing will have a margin if 6-8 ticks or something similar
That's the tricky part im afraid 
, it's just something you have to learn from experience of the markets.
there is no one fits all answer to you question unfortunately.
It really depends how the price got to -10 ticks and if it's been at that point before or not.
you have to use your judgment to whether it's likely to come back or drfit further.
If it was a strong and definitive move breaking previous resitance points then you probably should have cut it earlier but if it was just a spike then there is probably no need to panic. also need to watch the other horses too, eg if another horse has been backed heavy and now has started to reverse then the odds should come back again.
In a nutshell when you have served your apprenticeship all will become clear
, it's just something you have to learn from experience of the markets.there is no one fits all answer to you question unfortunately.
It really depends how the price got to -10 ticks and if it's been at that point before or not.
you have to use your judgment to whether it's likely to come back or drfit further.
If it was a strong and definitive move breaking previous resitance points then you probably should have cut it earlier but if it was just a spike then there is probably no need to panic. also need to watch the other horses too, eg if another horse has been backed heavy and now has started to reverse then the odds should come back again.
In a nutshell when you have served your apprenticeship all will become clear