Barramundi
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And presumably a re-exit strategy?imo peoples' plans should encompass all three strategies - entry, exit and re-entry.
And presumably a re-exit strategy?imo peoples' plans should encompass all three strategies - entry, exit and re-entry.
hey A
agreed - splitting 50/50 (or whatever % suits) is definitely the best of both worlds and can also be applied to entry methodology as well of course
yes its advanced stuff and not suitable for newbies but these kind of Discussions alongside MM are for me where the holy grail is for profitable trading vs finding the next great indicator/signal
N![]()
Hi NVP,
I am a big fan of scaling out. But I guess here you are talking about scaling in.
This is something I have never really done (unless you count a new entry on an instrument I still have a trail on).
I know a lot of traders do scale in, it is something I would like to find out more about. Could you describe the methods you use for this please?
As for the topic my scaling out exits are:
I have 5 lots and 2 targets into the longer term trend.
I exit 2 lots at 1:1, and bring the remaining 3 lots to b/e.
Then I exit 2 more lots at my 1:2 target and leave the last one as a runner, if a new entry sets up I will move this last (runner) stop to my new entry stop. (If longer term trend shows a sign of possible reversal I will exit this runner, without waiting for a new set up.)
(If my first 1:1 signal is generated at much less than 1:1, I will exit all at whatever the market has given, this for me is an indication the trend is now ebbing.)
Hi NVP,
I am a big fan of scaling out. But I guess here you are talking about scaling in.
This is something I have never really done (unless you count a new entry on an instrument I still have a trail on).
I know a lot of traders do scale in, it is something I would like to find out more about. Could you describe the methods you use for this please?
actually some recent research and testing I have been doing reminded me of another factor I rate very highly in assessing Exit positions
Average True range of the Time period/pair(s) you are trading
if you are lucky enough to get extended (or whatever % of ATR you set) it may be a good idea to lock in some profits :smart:
N
I know a lot of traders do scale in, it is something I would like to find out more about. Could you describe the methods you use for this please?
Average True range of the Time period/pair(s) you are trading
Check out FTI's thread "Technical Analysis Fallacy" over on FF, he's a bit of a specialist at scaling in and out.
This is my preferred method. I like 1XATR for SL and 2XATR and 3XATR for PT's. In my testing these performed as well as anything else except trailed Stops which entail longer draw-downs.
For very low drawdowns I found a 5-bar timed exit was ideal but not as profitable in the long run because you end up cutting off too many late-starters before they get chance to go.
In the article "Beating the Foreign Exchange Market" (Sweeney, Journal of Finance 1986), filter rules are discussed, in this case as entry signals, but I reckon they're potentially good as exit signals.
The idea is simple - a signal is triggered by a fixed percentage move such as 0.5%, 1.0%, 2.0% etc. off a recent high or low.
The definition of "recent high or low" has various parameterisations, as does the percentage retrace.
thats real nice V - and easy to follow...just out of interest have you done any work to establish what the 2X ATR equals say as a standard deviation of the ATR ?
yep.........% could be placed in the same school as ATR as they both look at the historical performance of the instrument to indicate the future volatility
N
Not looked at standard deviation, prefer to keep things simple. One thing I discovered is that it doesn't much matter what you use because when you adjust, you end up swapping Hit Rate for RR Ratio. the exception was 1XR which gave very poor results (trend bias not being utilised?) and with 4XR+ there is a slight drop off of profitability coupled with the inevitably greater DD.
The main thing I think is to pick something that works reasonably well and apply it consistently. Correctly identifying the direction of flow is far more important IMO; tinkering with the PT doesn't seem to make as much difference as you'd think, so long as it's not outrageous.