Quote:
Originally Posted by condor
One question, before everyone disappears from this thread:
Tess, are you aiming for trades that last 2 to 3 days, or do you usually exit sooner than that?
Many entries have been deleted, so it's frustrating not to know what I've missed. I'm only about 1/3 of the way through the thread.
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Yes condor, a good percentage of our various account activity is geared toward medium term positioning.
If you think about it, there are 2 elements of the equation that require a slightly looser grip than others.
You can control your risk at outset & you also got a pretty clear idea as to the initial entry criteria & maybe the ideal location(s) for any compound or add-in stakes along the route if the move begins to mature.
The 2 flies in the ointment are usually the speed & behavior (aggressive or passive) of the move + the initial & ongoing destination.
Time doesn’t really come into it as a basis for profit potential. You could open & close a 400-pip deal in a matter of a few hours if the psychology is intense out there & your trailing procedure takes you out as per the strategy parameters etc.
On the flip side, that same 400 pip deal might stretch out to 3 days if the landscape is nervy, spiky or a little on the cautious side. Get my drift?
At the end of the day it generally comes down to your strategy model, the risk exposure you’re adopting for that particular deal, & your trailing or profit taking mechanism.
Those elements will change according to the behavior & structure of the price action at the time of execution & your specific aims & reasons for the deal.
Most professional players will feed or compound into a run. So, at the point of entry (particularly if it’s some kind of breakout play), they’ll sling out a feeder stake to test the waters. If the price action pulls back & then plays out ok, & the move attracts decent participation, they’ll compound into it as it opens out (via pullbacks) until they aggregate their full exposure or positional % for that trade. That’s commonly known as “adding to a winner”
If the initial entry washes out or springs back inside the breakout trigger & fakes, then they haven’t lost anything apart from an opportunity.
Most amateurs adopt the opposite scenario. They either go all in from the outset & then panic as/if price begins pulling back, assuming they’ve been mugged…..or they sit there like rabbits in the headlights & compound into the move as it continually shifts against them. They get some strange notion into their head that they’re simply jostling for a better average position or “hedging” their exposure. Never mind the costs of excessive spreads/commissions/account costs etc, LOL
That’s called “adding to a losing position” & not only begins to chip away at their psychology tolerances but will eventually results in a margin call.
Ps: the recent deletions in the thread haven’t affected the technical or core information content at all. She merely tidied up the off topic material.
Pps: I’ll be around to answer & sweep up any tail end questions & queries until the middle of next week. Tess is now on vacation until Thanksgiving & Jos is headed back home Stateside tonight for a few weeks.
If I’m not able to get to the thread, I’ll pass my login details across to one of the fella’s here & they'll wrap it up.