glad to hear such exuberance from you mentor........i woke you up did I......? great.......great trading to you.......I hope JM is still around somewhere........joeycata is escaped from the zoo that is the et zoo........hope all are well.........
I am a newb to the Dow only been trading it for a few months. I have just recently started trading 2 lots. Today was an interesting day. I have been attempting to use a much wider stop than I have been in the past (20 ticks). Well, after my first trade I was down $200 since I was stopped out. My first mistake hear was that I did not wait for a good entry point. My second trade I felt like I made an OK entry but the market went against me from the beginning. I decided to stick to my rules and we will see what happens. I immediately started out down 5 ticks then 8, 10, 12, 11, 9, 13, 14, 15, 17, 18 and then within 5-10 minutes had retraced all the way back plus putting $50 in my pocket. The rest of the day was so choppy that I was scalping 4-5 tick hear and there and by the end of the day I was up $60. Does anyone disagree with using such large stops. This is one part of my strategy that I am constantly changing and would like to hear what others are using. Thanks
Well, I don't currently trade futures (though I'm interested in doing so), but I personally think that your stops are far, far too wide. I'm sure that others here would be better suited to provide advice, but I would think that you should be running stops of 5 points or less. Point is, if you are wrong, why not get out as quickly as possible and look for a potential re-entry point?
It depends on the rest of your strategy. When I traded YM with a 20 point stop, and it got hit once, I quit for the day and went and played golf, or detailed the cars, or mowed the yard etc. You have to have the discipline to walk away and not get stuck in revenge trading. You also have to have confidence in yourself and your plan and remember tomorrow is another day.
IMO, there is no one-size-fits-all answer to the question. It's dependant on the specific trade setup, your (or your system) reasoning and expectation for the trade, and your account size, for which you have a set of rules. Most important, imo, are YOUR rules. You should have a max loss per trade and a max loss per day parameter. Max loss per trade is irregardless of number of contracts. And max loss per day ALWAYS takes precedence. BTW, max loss rules, per trade and per day, do not change daily generally speaking. They should be adjusted based on account size. Personally I re-eval MY loss rules once a month, at EOD of options expiration day. Note, options expiration is just a constant. No other meaning. Cheers
develop a system that never requires over 10 pts stops.....YM intraday only...........that is wide stop for this market........if your system is one that is above average........the millions of bits of information you will learn if you stick with it, is the easy part, the unlearning of the million bits which is required is the difficult part...........never test trade with real money........and don't depend on dead charts to tell you what happened during the day.........most of what you see isn't what you saw realtime.........don't get complicated and think learning the market is the key.........your emotions and abitlity to follow good rules most important....osorico told you very well what to do but i can almost bet u won't do it as almost no one does.......they seek advice and overrule it because of ego.......hope you are not average .........tenacity and honesty are the 2 keys........honest with yourself..........
I agree with porgie.....10 point stops max intraday on the YM....pinpoint your entries......your strategy should define your entries.....thereby defining your stops.... Also check out osorico's YM journal from a couple months back. EXCELLENT! You should be able to cull a few nuggets of wisdom from this kick-a$$ journal. Man, this guy was raking it in! Almost 10:30, time to load up for the reversal!