I haven’t seen this in any threads (and I have looked) but I often see it recommended when charting that you leave in place a limit order to get on board a breakout once it has begun to occur, as this is usually the highest pip earner�. My personal experience with this has not been good�I often see it spike straight up/down opening my position only to see the market immediately head the other way afterwards�been very burned more than once using real money…
So do the experienced traders here leave limit orders open based on chart patterns and potential breakouts or do they manually watch the market and make the trade when they see it occur??
I know this can be a problem on stop loss as well but that�s a different subject�
And yes:
I really am trying to search this stuff before posting these daze�
�.dazed from reading too many posts
Thanks to any and all who take the time to respond…
one of the most tricky is a limit order… i usually use a buy stop or sell stop because it is obvious that the trend is your friend and a buy or sell stop is on the same wave of the trend …and sometimes i do it manually when everything is obvious and clear technically and fundamentally. i believe there is no rule in how you enter the trade…
to place a limit order is like u went to that specific restaurant again and again and you know which is the best plates in the menu… i mean you’ve been buying or observing usd/cad for a long time now and you know that the retracement will reach that specific price and that’s where you will put your limit order to buy it again …
thanks for taking the time to respond…I’m quite familiar with limit orders, my problem is having been burned trying to use them to enter positions based on possible breakouts…or for news trading that sort of thing…
seems as if the company is hunting your orders just to take them the other way… I’ve seen it in stocks a lot but that’s cause everyone and there dog can see you limit order…
I’m trying out EFX. They are an ECN shop so limit orders are quite effective in this environment since you can see the depth of the market, all the pending orders and volume for a certain number of pips from bid and ask. And if you keep watching, you’ll actually spot short term support and resistance. Don’t think they’ll hit it just for fun. So if you get hit, it’s the market that’s doing it and not the broker firm.
if you got burned many times, have you thought that maybe your limit orders are “too close to reversal points, pivots, fibonacci, whatever?”.
You see, placing a limit order aint easy tactics. I definitely know that if you place a limit order “for potential breakout” at a definite price you WANT to get in as soon as possible so you don’t “loose pips” right? if you take a look at the trade of yesterday you sure “SEE” that you could have entered at least 25 pips sooner. so probably today you will enter 25 pips sooner, but today the price instead of breaking out for good, yust made a false break out and then plunged.
Is that story familiar?
if yes then my m8 consider re-evaluating your strategy and your psicological aspect of trading.
It is quite CLEAR that if you DON’t want to get “burned” you should trade in such a way that false breakouts wont trigger orders ( give it some more room) and ofc “loose” some pips. Or you could place stop limits once the order is triggered. so if the price reverses you get stopped out ( eith a loss , yes, but no1 said you would win 100%, right?).
On the other hand it also depends on the time period you are trading on.
on an daily chart ( if you see a flag forming, or the price is at 62% fibonacci ) and you put a buy just 10 pips above it, its is LOGICAL that it will get triggered, and i hope that after that you dont place a stop 10 pips under the resist/revers level. you will in such case be ALWAYS stopped out and end up in red. You should give each entry sufficient buffer zone ( or moove around zone as i call em). Breakouts of 100 pips in the direction that you placed your order ( buy or sell) that go straight to your TP and that you see them coming are sooooo reare.
So placing orders in order ( sorry for the owrd trick) to make money while sleeping or not in front your PC takes a bit of strategy, knowledge ( of the pair) and NERVES! ( a lot of the last one). IMO trading like that takes a 1000000 more times of nerves and determination of skill than opening and closing positions live.
Hope this helps.
GL m8