Hi shortorlong,
Thanks for answering. I've tried to clarify my comments. I've made a lot of mistakes in the past, with regard to index trading and this latest exploit may result in disappointment, yet again, but the 2007 trophy may be within my grasp! I don't want to give the impression that what I say are the words of an expert and I, certainly, am not suggesting any "best way" of doing things. However, I would like to entreat everyone to "Keep the losses small!"
I use an arbitrary 5-6 points and close policy.
I think that I may have misled. I use an arbitrary stop loss policy of 5-6 points. I stick a 10 point stop loss on the trade in case I don't close out in time, manually. I don't close after a 5 point loss, I try to get as much as possible on a winning trade, otherwise I don't think my system would work.
I have come to a similar idea .. if I see a profit .. I take it .. of course this stops me from running my winners .. which is a problem. but I just don't think I can predict the direction of the next few pips .. many times I have tried to run a winner and ended up hitting my stop. The other thing I have considered is that the probability of hitting a stop that is far away must be much less than hitting a very small profit target. .
It's good that you commented on some of my of my quotes because I'd hate to be misunderstood. IMO, you have to run your winners. There are a lot of 20+ point trades out there that make the close stops worth while and, if you have had a couple of losers that day, you must have those winning streaks.
Stops are a necessary evil I realise but . twice this week I have watched a bad trade turn benign by not setting a stop and adding to my losing position when it is 30/40 points out .. now I know this can end in disaster .. and probably will .. but I am only trading £2 per point ..
I know I need to think about this .. and stop doing it! after all: I can't predict the next tick and yet I am effectively trying to predict a reversal.
A bad habit. Knock it off! If you had closed out at 10 points loss, instead of 40 points, you would have been able to open a trade lower down with, if you were correct in your assessment of the trend direction, a good chance of making a breakeven or better by the time the index had risen to where you thought it was a good buy in the first place.
Good trading
Split
Thanks for answering. I've tried to clarify my comments. I've made a lot of mistakes in the past, with regard to index trading and this latest exploit may result in disappointment, yet again, but the 2007 trophy may be within my grasp! I don't want to give the impression that what I say are the words of an expert and I, certainly, am not suggesting any "best way" of doing things. However, I would like to entreat everyone to "Keep the losses small!"
I use an arbitrary 5-6 points and close policy.
I think that I may have misled. I use an arbitrary stop loss policy of 5-6 points. I stick a 10 point stop loss on the trade in case I don't close out in time, manually. I don't close after a 5 point loss, I try to get as much as possible on a winning trade, otherwise I don't think my system would work.
I have come to a similar idea .. if I see a profit .. I take it .. of course this stops me from running my winners .. which is a problem. but I just don't think I can predict the direction of the next few pips .. many times I have tried to run a winner and ended up hitting my stop. The other thing I have considered is that the probability of hitting a stop that is far away must be much less than hitting a very small profit target. .
It's good that you commented on some of my of my quotes because I'd hate to be misunderstood. IMO, you have to run your winners. There are a lot of 20+ point trades out there that make the close stops worth while and, if you have had a couple of losers that day, you must have those winning streaks.
Stops are a necessary evil I realise but . twice this week I have watched a bad trade turn benign by not setting a stop and adding to my losing position when it is 30/40 points out .. now I know this can end in disaster .. and probably will .. but I am only trading £2 per point ..
I know I need to think about this .. and stop doing it! after all: I can't predict the next tick and yet I am effectively trying to predict a reversal.
A bad habit. Knock it off! If you had closed out at 10 points loss, instead of 40 points, you would have been able to open a trade lower down with, if you were correct in your assessment of the trend direction, a good chance of making a breakeven or better by the time the index had risen to where you thought it was a good buy in the first place.
Good trading
Split
In three trades I added to a losing position. Of those, two were closed in profit one was closed for zero. 54 points to me for the week.
