Hi guys, everytime my trades goes in the right direction (66% of my trades), I’m having problems with letting them run. I move my SL to BE or even further and then my trade gets closed by SL (but actually winning), only to see a few hours later that price moving furhter in my direction.
So I’m asking you kindly if you could suggest any indicator or strategy where I can figure out if the price will still move in my direction or if it’s right to move the SL closer. I thought about measuring trend strenght with RSI or ADX but I don’t really like indicators and usually only trade D1 / H4 timeframe.
This is the key question in trading - what to do with the winners.
I have been so angry in the past at having my tightened-up SL’s hit or having my trailing SL’s hit that I have used a rule that gets me out after three consecutive favourable daily closes: that way you’re getting out near an extreme high/low, rather than at the worst price in a pull-back.
If I understand correctly - you have strategy with 66% winners and you are able to move to BE.
Isn’t that a good enough strategy already? I mean, if you have positive expectancy then it’s only the scaling issue?
Depending on how large positions you trade you can always leave part of it to run.
As an experiment:
eg. you trade 0.03 lots, SL = 1R
after being in profit for 1R close 0.02 lots and leave the last one with original SL
this means, that after being 1R in profit you book 0.33R sure gain and have virtual BE on last trade WITHOUT moving the SL higher (one trade closed with 0.33R profit and the leftover open with 0.33R stop loss)
This is not unusual, and an emotional FOMO signal which needs to be managed, because it won’t go away. From your post, you have acted sensibly by moving your S/L up to breakeven or even closer to the price action.
There are a few considerations available. First, you could use a trailing stop with a wider spread. You could add to your position - which is how pros trade, or you could play safe and take a part profit and let the trade remainder continue, which is better than moving the S/L too close.
Now for the technical solutions. You could try to identify where the next S&R zone exists and that will give you a feel of where your trade could find resistance. In most cases this is a natural occurrence as you have found out that retracements happen before continuing which is why you get stopped out only to see a continuation at a later time.
Indicators can be useful if used properly for confirmation. My favourites are RSI with just a 50 line. Above is bullish and below is bearish. MACD histogram (3:10:16) for trend strength with PSAR (0.09.:0.4). All are lagging indicators, but the set up as above is quite close to price action.
When I trade the D1 / H4 timeframe and reach your positional query, I would head down to the 15M TF to see what’s happening there. That insight could make up my mind how to continue. Finally, every trader on the planet suffers from your situation. Some resolve this by not looking at their chart at all. I don’t because I enter a T/P just above or below a S&R zone. Just let it run if you are confident with your strategy set up.
Yeah thanks to babypips’ school of pipsology I was able to reach 66% winnng rate and my aim is to get a 70% winning rate. Thank you for your suggestion, closing a part of my position and let the rest run sounds good!
Just remember, that this will negatively impact your overall risk to reward ratio. After some backtesting you will see how often and how large runs you can get with last one. It may occur, that it’s better to just close everything on 1R profit Try to not emotionally bond with any idea, just let numbers decide what is best for your setting.
It’s a very common issue! By the way, you can use Support/resistant levels to identify the direction of market! Market momentum is such an important parameter here!
Personally, I like to keep it the same every time. I trade the 1 min tf and this is what I do…I’ll still miss my share of runners but doing it like this mitigates a lot of the stress of always trying to get more. I will move my sl to break even at .75r and then at 2r I’ll move my sl to 1.5r. At every .5r increase in price I will move my sl up .5r. For example price hits 2.5r, I’ll then move sl to 2r.
i think that could be some anxiety factor since you are obviously trading with your real money so you try to close early so you don’t end up with a loss. However, if you are having a good winning rate (66%) and you still make a decent profit on each trade then i think it’s fine. My only suggestion is to set your risk/reward ratio and stick to it. if it 1/2 then set your TP and let it run.
Just be careful getting in among the ‘mess’ of the smaller time frames. Often I’ve confused myself out of a trade because the 15min was telling me a story that was only part of the picture. When I’d look to the 4hr or daily, it confirmed my confidence in just letting the trade run, if that makes sense
It could be due to your trading strategy and mindset. However, there are situations when it is preferable to leave early in order to avoid losses, as negative threats impact a lot in our trading.
How many pips gain before u move Yr SL to BE? Usually when I’m up 50 pips and above, I move to BE. If I get stopped out, I will then pause and re-acess if I should re-enter the trade. By the way, any west side traders here?
I mean, if you have positive expectancy then it’s only the scaling issue?
Try to not emotionally bond with any idea, just let numbers decide what is best for your setting.