Stop loss - daytrading

[tanvirmk]

I just started day trading, as I have a day job that I can't get rid of right away, I do trading only an hour in the morning.

I am having trouble setting stop loss. Either I am exiting too early or too late. I am hoping to get insight from experienced traders. Should I use previous candle low/high to exit or trailing stop? If candles, should I use 5 mins reading or last day? As I trade in the opening time only (due to my job) and gap ups/downs, ATRs are too high! I am with IB and that allows loads of order types.

 

[coopster]

Too many questions with very vague details. how you use a stop depends on your pre-defined trading strategy.

Logically the stop is placed at the point where you would consider yourself incorrect in your prediction of price movement. There are no hard rules for placing stops. Its not possible to advise any more without knowing your strategies.

The first hour is always volatile and a bit unpredictable. Not ideal for learning. I hope you're using a demo account to start with.

 

[Vicorka]

I just started day trading, as I have a day job that I can't get rid of right away, I do trading only an hour in the morning.

I am having trouble setting stop loss. Either I am exiting too early or too late. I am hoping to get insight from experienced traders. Should I use previous candle low/high to exit or trailing stop? If candles, should I use 5 mins reading or last day? As I trade in the opening time only (due to my job) and gap ups/downs, ATRs are too high! I am with IB and that allows loads of order types.

If you want to use trailing stop you may try Chandelier Exit which is based on the ATR

On the other hand if you are trying to day-trade and you can do it only limited time after the market opens (due to yourjob) I think you should consider to going to higher time-frames. It is quite risky to day-trade when a daily trend is not set yet and is highly volatile.

 

[tanvirmk]

Thanks. I'll check that out. Are you a subscriber of MarketVolume? I have been following their charts for a while now.