Day traders, do you cover open positions?

Trading Discussion
1

Hey guys,

Been lurking here for a while. I’ve been swing trading CFDs for the past 12 months successfully, and have decided to make the switch to forex and try my hand at day trading.

Given the tremendous volality and relative low transaction cost (compared to CFDs) I was wondering if anyone is using covering positions on short term trades?

For example, after a particlularly strong rally, given the randomness of the retrace at times, I was thinking of opening a short position at the peak to cover the possibility of the rally collapsing (and also locking in profit on an above average move, which may or may no continue). This could then be quickly closed if the rally continued to show strength.

Is anyone doing this profitably? Or do I just have to suck it up and accept the volatility?

It’s not something I really did in my CFD trading, but then transaction costs were relatively much higher then the 2 pips it costs me now.

Still not turning a profit on FOREX… but getting close. Much easier to overtrade when you’re in front of a screen all day! I find myself finding one that works, revelling in the profit then throwing it all away on the next 2 trades :expressionless:

Thanks

Bagz

2

an issue before an answer !

forex is NOT random — it works on support and resistance areas and uses those areas from many timeframes.

with experience, any good trader can take a trade, select their tp point and watch it hit !

now the idea of going short at the top of a rally is certainly creditworthy, AS LONG AS YOU KNOW its the top !

HOW do YOU tell the top of a move — on every timeframe from the one minute to the daily ?

i know a bunch of newbs that are doing just that, with some teaching, but they will certainly not enter a short position until they receive CONFIRMATION that is the end of the move !

PLEASE, dont EVER say its RANDOM again, since i prove its not every single day !

enjoy and trade well

mp

[B][I]Within the great hall at Elfinore stands a wondrous coffer, precisely four cubits square and securely latched against the outside world. Inside that repository, shut away from impertinent eyes, abides many an intriquing trading secret garnered from around the world and over the ages !

As a child, i used to watch from the darkness as the secrets were debated and annotated by the elders. No one there held a single thought of my presence – BUT I KNOW WHERE THEY HID THE KEY !![/I][/B]

[I]For example, after a particlularly strong rally, given the randomness of the retrace at times, I was thinking of opening a short position at the peak to cover the possibility of the rally collapsing (and also locking in profit on an above average move, which may or may no continue). This could then be quickly closed if the rally continued to show strength.[/I]

3

mp6140…

[B]“forex is NOT random — it works on support and resistance areas and uses those areas from many timeframes”[/B]

Honestly… That line should be quoted and placed at the top of every FOREX thread out there!!

NICE!!!

:slight_smile:

4

It’s easier to find and existing trend and get in while it is still strong, rather than trying to find a top or bottom or breakout. When you do that you are asking to be faked out unless you have lots of experience.

6

Was wondering how you came up with your plan. and i guess more importantly how do you plan to quantify that the rally is out of steam. (find the top).

i realise that you may have seen that a rally often reverses back on itself. but to be honest if you cannot use a repeatable method for taking a trade on this, then your doomed to failure over time. This is tantamount to gambling, go to the casino for this activity.

while the Forex isnt 100% predictable, the Forex is not exactly random, the best and most disciplined traders make money consistently, its just a matter of if you are disciplined