price & stops

[Grey1]

I believe that the real money is made catching the big swing in the market. .

This is the most important issue in trading ,, I have a program trade that scalps for 20-30C perstock and makes lot of $$ how ever the only reason that is making $$ is because it is fully automated and can get in and out of 20 stocks and manage and control the risk at the same time but most traders don't have this facility ( impossible to do this manually ) and I think what TraderDante is saying is well well worth concentrating upon..

Saying that ,, identifying the trend direction is not an easy task and it is far easier said than done. In fact with out proper education not many can identify the trend formation early enough to capitalize on .

Catching the TREND is the first priority in DAY TRADING ,, the rest ( risk managment,money managment ) is secondary.
I am amazed that so many people still arguing about where to put their stops than learning the theoretical / fundamental concepts for the BIRTH of the trend.

Unless you learn to catch the TREND , there is little point in fighting over the stop loss.:smart:

attachment shows some of the trades today




Grey1

 

[wasp]

This is the most important issue in trading ,, I have a program trade that scalps for 20-30C perstock and makes lot of $$ how ever the only reason that is making $$ is because it is fully automated and can get in and out of 20 stocks and manage and control the risk at the same time but most traders don't have this facility ( impossible to do this manually ) and I think what TraderDante is saying is well well worth concentrating upon..

Saying that ,, identifying the trend direction is not an easy task and it is far easier said than done. In fact with out proper education not many can identify the trend formation early enough to capitalize on .

Catching the TREND is the first priority in DAY TRADING ,, the rest ( risk managment,money managment ) is secondary.
I am amazed that so many people still arguing about where to put their stops than learning the theoretical / fundamental concepts for the BIRTH of the trend.

Unless you learn to catch the TREND , there is little point in fighting over the stop loss.:smart:

attachment shows some of the trades today




Grey1

No one is disputing that the trend is important. That's on another thread.

I would say the risk and money management are equal in importance.

The stop is as important factor as 'catching the trend' as it can make the difference between taking multiple or large losses, plus those who endevour to obtain the best entry (to have small stops) do so by getting in sooner and out later, thus making more points/ticks/pips.

NB. Not sure why you included the screenshot?

 

[Bladerunner]

Starts in os or ob in higher tf I think you said in a post

This is the most important issue in trading ,, I have a program trade that scalps for 20-30C perstock and makes lot of $$ how ever the only reason that is making $$ is because it is fully automated and can get in and out of 20 stocks and manage and control the risk at the same time but most traders don't have this facility ( impossible to do this manually ) and I think what TraderDante is saying is well well worth concentrating upon..

Saying that ,, identifying the trend direction is not an easy task and it is far easier said than done. In fact with out proper education not many can identify the trend formation early enough to capitalize on .

Catching the TREND is the first priority in DAY TRADING ,, the rest ( risk managment,money managment ) is secondary.
I am amazed that so many people still arguing about where to put their stops than learning the theoretical / fundamental concepts for the BIRTH of the trend.

Unless you learn to catch the TREND , there is little point in fighting over the stop loss.:smart:

attachment shows some of the trades today




Grey1

Good post Grey

did you not say ~ Starts when higher tf becomes os or ob = potencial trend in next one down



td does not need to concern himself with the risk of not being in, which is a big risk if your trying to get in with a tight stop

how much margin do you want going into the close etc etc

overnight move / extension /small or large gap etc very late in the session move.

We have pre market after hours the lot these days, its a nightmare if your a trader who is trying to use a scalpers stop to enter a td type move imho the market is just not that accommodating in fact I have observed the opposite to be more probable

costs a bit to if you have made a number of intra day attempts and find your self locked out :-O

Andy

 

[Paul71]

This is the most important issue in trading ,, I have a program trade that scalps for 20-30C perstock and makes lot of $$ how ever the only reason that is making $$ is because it is fully automated and can get in and out of 20 stocks and manage and control the risk at the same time but most traders don't have this facility ( impossible to do this manually ) and I think what TraderDante is saying is well well worth concentrating upon..

Saying that ,, identifying the trend direction is not an easy task and it is far easier said than done. In fact with out proper education not many can identify the trend formation early enough to capitalize on .

Catching the TREND is the first priority in DAY TRADING ,, the rest ( risk managment,money managment ) is secondary.
I am amazed that so many people still arguing about where to put their stops than learning the theoretical / fundamental concepts for the BIRTH of the trend.

Unless you learn to catch the TREND , there is little point in fighting over the stop loss.:smart:

attachment shows some of the trades today




Grey1

Some good points here, Grey1.

Firstly i'd like to say that to catch big moves, a trader has got to know what creates a big move, it's no good buying in at what looks like a mid term bottom technically then sitting back on a 100 point stop at 1% risk on an fx market and saying to themselves foolishly "....yeah, only go for the big moves me....", that's BS. I'd say the bigger the TF, the more fundamentally aware the trader has to be, if he's not fundamentally aware then his big runs and slack stops won't add up to a chicken Mac Sandwich. So he can trail a stop, so can everyone else. Nothing is guaranteed long term from a purely technical perspective.

This is by no means aimed at anybody who uses t2w, just more of a rant than anything

 

[Grey1]

Good post Grey

did you not say ~ Starts when higher tf becomes os or ob = potencial trend in next one down



td does not need to concern himself with the risk of not being in, which is a big risk if your trying to get in with a tight stop

how much margin do you want going into the close etc etc

overnight move / extension /small or large gap etc very late in the session move.

We have pre market after hours the lot these days, its a nightmare if your a trader who is trying to use a scalpers stop to enter a td type move imho the market is just not that accommodating in fact I have observed the opposite to be more probable

costs a bit to if you have made a number of intra day attempts and find your self locked out :-O

Andy

Yes always start with hight time frame ,, Trend is next lower time frame.

I am not familiar with TD style of trading and how he manages his risk , In fact I have no idea how he trades,, How ever all I am saying is scalping is a high risk strategy and best suits automated style of trading. Also what I am stressing is that money and risk managment are not Vital to trading but are essential for return optimization/ risk reduction .

As far as Pre market or over night moves are concern one has to find an appropriate volatility model to adjust his pos size and his stop accordingly .It sounds nice to say HAVE A TIGHT STOP but this is actually irrelevant in risk managment and people keep parroting TIGHT STOP LOSS to make them sound pro,,




Grey1

 

[Paul71]

As for stop losses, the markets have certain prices that they favour or use on all TFs (technically). the market is either above or below the price that YOU (yes, YOU, the trader) wants to get in on. Now, i'm no rocket scientist, but when i buy a price and the market goes below it....i get out of the trade/position, no hoping, no praying, no wondering about stop hunting or market maker action, i get out. This is how i trade, and i wouldn't for one minute try to push it on anybody, everyone trades how they want to. I just can't understand why i would want to hold a long on a price that's been sold off?

 

[wasp]

Some good points here, Grey1.

Firstly i'd like to say that to catch big moves, a trader has got to know what creates a big move, it's no good buying in at what looks like a mid term bottom technically then sitting back on a 100 point stop at 1% risk on an fx market and saying to themselves foolishly "....yeah, only go for the big moves me....", that's BS. I'd say the bigger the TF, the more fundamentally aware the trader has to be, if he's not fundamentally aware then his big runs and slack stops won't add up to a chicken Mac Sandwich. So he can trail a stop, so can everyone else. Nothing is guaranteed long term from a purely technical perspective.

This is by no means aimed at anybody who uses t2w, just more of a rant than anything

What do you mean by big move in FX (that requires fundamentals)?

 

[Grey1]

Some good points here, Grey1.

Firstly i'd like to say that to catch big moves, a trader has got to know what creates a big move, it's no good buying in at what looks like a mid term bottom technically then sitting back on a 100 point stop at 1% risk on an fx market and saying to themselves foolishly "....yeah, only go for the big moves me....", that's BS. I'd say the bigger the TF, the more fundamentally aware the trader has to be, if he's not fundamentally aware then his big runs and slack stops won't add up to a chicken Mac Sandwich. So he can trail a stop, so can everyone else. Nothing is guaranteed long term from a purely technical perspective.

This is by no means aimed at anybody who uses t2w, just more of a rant than anything

Could not agree more,, What creates big moves is OB /OS technically ,, positive. negative news fundamentally . Example Today the futures where down 300 points and by the time the news of the warren buffet buying stocks surfaced the market rallied 200 points up .

Now, Lets see what TD is saying here,,, TD is defending a trend following concept ( BIG MOVES , LOW priority entry, even random entry ) against oscillatory system ( small moves high priority entry ),,, and he argues that he prefers to catch the big moves. There is little doubt that he is correct . It is a fact that trend following systems out perform any high frequency oscillatory strategies. I have the automated version of both system and the trend following code has time time again outperformed the latter.

As far as stop is concerned that is a function of volatility and TD has not addressed that any way .

grey1

 

[wasp]

It sounds nice to say HAVE A TIGHT STOP but this is actually irrelevant in risk managment and people keep parroting TIGHT STOP LOSS to make them sound pro

It has nothing to do with sounding NICE or PRO and all to do with THE BEST FINANCIAL GAIN.

 

[wasp]

As for stop losses, the markets have certain prices that they favour or use on all TFs (technically). the market is either above or below the price that YOU (yes, YOU, the trader) wants to get in on. Now, i'm no rocket scientist, but when i buy a price and the market goes below it....i get out of the trade/position, no hoping, no praying, no wondering about stop hunting or market maker action, i get out. This is how i trade, and i wouldn't for one minute try to push it on anybody, everyone trades how they want to. I just can't understand why i would want to hold a long on a price that's been sold off?

This is the crux of the stoploss isn't it... To get you out as soon as the market goes past the point where the reason to enter is still valid.

 

[Grey1]

It has nothing to do with sounding NICE or PRO and all to do with THE BEST FINANCIAL GAIN.

The best financial gains comes from catching the big moves and not tight stops. stops are function of stochastic volatilty and can be wide or small depending on pos size for a given capiital

Grey1

 

[Paul71]

What do you mean by big move in FX (that requires fundamentals)?

Significant moves in any market require fundamental changes, but that's just the overall bigger picture. A big move on the yens may be 50 pips to one person, 200 hundred pips to another and so on, i suppose it all depends on leverage and personal risk dependant upon style and strategy.

 

[Paul71]

It has nothing to do with sounding NICE or PRO and all to do with THE BEST FINANCIAL GAIN.

Best gain for less risk. Some people will no doubt that argue its death by a thousand cuts....bollarks...you should get more BEs than losses, and if the same person who wishes to denounce tight stops is working a strategy from an s/r view of the market then they are really talking bollarks.

 

[wasp]

Best gain for less risk. Some people will no doubt that argue its death by a thousand cuts....bollarks...you should get more BEs than losses, and if the same person who wishes to denounce tight stops is working a strategy from an s/r view of the market then they are really talking bollarks.

It's only death by a thousand cuts if you are crap at trading and deciphering the next move!

 

[Paul71]

It's only death by a thousand cuts if you are crap at trading and deciphering the next move!

Or self harming, it's a medical condition. Nice one.

 

[Paul71]

It's only death by a thousand cuts if you are crap at trading and deciphering the next move!

Ok. If a person/trader is not working S/R where do they put thier stops? How do they choose a stop area?

1) Using the tops and bottoms of candles on any TF (but not at any obvious sr level)

2) A random entry stop based on a set %

3) 'Indie'cators

There must be more. Are there anymore?

 

[Grey1]

Ok. If a person/trader is not working S/R where do they put thier stops? How do they choose a stop area?

1) Using the tops and bottoms of candles on any TF (but not at any obvious sr level)

2) A random entry stop based on a set %

3) 'Indie'cators

There must be more. Are there anymore?

Historical and future volatility..

Volatilty will define your pos size ,,, your pos size defines your stop level ,,
Tight stoploss is not any better than a wide stoploss if volatilty and hence POS sizing is calculated incorrectly,, Tight stop loss only sounds better lol

Education is the key to this game .

Grey1

 

[new_trader]

So not only are you getting in later (one disadvantage), you are also using a larger stop (twice disadvantage)? Doesn't seem like a premium I'm willing to pay...


Sure they can, but you are comparing scalping with longer term trading meanwhile equating scalping with tight stops and longer term trading with wider stops. There is no reason why you cannot enter with a 1 point stop and come out with a 25 point profit.


"Being scared" has nothing do with it... trading 1 lot with 50 points stops is the same "risk" as trading 10 lots with a 5 point stop, so you can always scale down if you feel like you're risking too much. However, that's not the point new_trader was trying to make.

Let me put it this way. Suppose you could buy two lottery tickets. One costs $5, the other $10. Now if I told you there is, with both tickets, exactly a 15% chance you could win $200, which one would you buy (if you had to choose)?



Since scalpers are by definition not interested in catching a big swing, that's obvious. But again, just because you enter with a very tight stop, says nothing about the way you will manage the trade after you're in.

Thanks FW, at least you get it! I don't know why people have the impression I am a scalper. I have said it before and I will say it again. I am not a scalper.

 

[wasp]

Historical and future volatility..

Volatilty will define your pos size ,,, your pos size defines your stop level ,,
Tight stoploss is not any better than a wide stoploss if volatilty and hence POS sizing is calculated incorrectly,, Tight stop loss only sounds better lol

Education is the key to this game .

Grey1

Totally disagree with, well, all of that. No, sorry, the last line is okay.

 

[new_trader]

The best financial gains comes from catching the big moves and not tight stops. stops are function of stochastic volatilty and can be wide or small depending on pos size for a given capiital

Grey1

Why can't you catch a big move with a tight stop?

Are you saying I can't do what I do?...that's news to me...