XAUUSd: way to exit trade

I’ve a very powerful solution for entering
SL is always 20 pips
but which could be a nice choice for exiting trade ? I set up a breakeven at 10 pips
but no TP
there are some situations in which gold runs for 50/100 pips, others in which runs only 20/30 and then runs back to take the BE
Trailing stop couild be a nice option ? if yes, with trend follower system ? and if yes, at which distance ?
Thank you very much to all my friends

Really? That’s a strange plan indeed, because it naturally means that when the market’s volatile, your stop loss is effectively much smaller, compared with price movements, than when it’s not volatile.

Is that really your intention? :expressionless:

Wouldn’t it be easier, better and less risky to use a stop-loss that’s volatility-related, as all experienced traders and textbooks advise?

I strongly advise you against ever measuring SL-distances in terms of “pips”. The best way is “by price action/SR” (i.e. just above/below swings-high/low). The second-best way is “by numerical volatility (e.g. an ATR-multiple). A “number of pips” is a very bad way, and of course that’s also one of the many reasons not to use an automated trailing stop (because those are also measured as “a number of pips”).

Many of us who have actually researched it carefully consider trailing stops to be really unwise (albeit superficially appealing) for all the kind of reasons explained here. :sunglasses:

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So what do you suggest to look for sl tp? Can you give me some settings for atr for example and how to use it or other ways ? Thanks

As I mentioned above, for stop-losses IMO the best way is “by price action/SR” (i.e. just above/below swings-high/low) and the second-best way is “by numerical volatility (e.g. an ATR-multiple).

In some platforms the default for ATR is set at 14, and in others, 20. It doesn’t matter much, as long as you understand (as with any indicator you use!) what ATR is, what it’s actually displaying, and why.

In his beginners’ textbooks, Van Tharp always suggested 2 x ATR for a stop-loss, and used that multiple as the example in the backtested examples he provided.

The only person.I know who uses that method uses 2.5 as the multiple.

Nobody can tell you what will be best for you. It depends what you’re doing. You have to test it for yourself. You have to know how to do that.

This very helpful post should be useful for you, and enable you to avoid some common mistakes! :wink:

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20 pips is like click on gold what time frame do you use? M5? According to your exit type, I can give you some examples but you have to do own research,

  1. simple profit target in pips , ATR or percentage
  2. Time exit for example 30 minutes
  3. Trailing stop and some value which activate trailing stop in pips or ATR
  4. Indicator value like keltner channel, moving average, RSI
  5. Higher / lower time frame behavior
  6. Some other markets behavior

so, in this example I should approx put 30 pips as SL ?

Sorry, but I’m really not sure what you’re asking, there, Frank (and to be honest I’m really not sure to what extent you understand what I’m saying - absolutely no criticism intended!!).

You come across, if I may say so, as looking for a “really fast answer that doesn’t involve any learning-process” to something that’s actually a very intricate and complicated question, to which finding the answer typically takes a very long time and involves extensive testing of what you’re doing.

Again, no criticism intended. But from my perspective that makes it very difficult indeed to try to help you.

I can only repeat that in my opinion, you’re very likely, overall, to be better off putting your stop-loss initially a couple of pips below the previous swing-low for a long entry (or a couple of pips above the previous swing-high for a short entry) and thereafter trailing it manually a couple of pips beyond each recently-formed level of S/R (i.e. swing-low/high by prices), as the trade moves in your direction. This is certainly, in overall terms, a good way of cutting losses short while letting profits run, if you’re trying to “trade with the trend”. :wink:

swing high/low is what indicator ?
exists in tradingview ? what I have to check ?

It’s not an indicator. A swing-high is just the level the price reaches after a movement higher before it falls back lower (and vice-versa for a swing-low).

You seem to be trading a 5min chart and looking for relatively quick, small moves. Whilst this is ok, I wouldn’t term it “trend trading” in the real sense of a “trend”. Rather, it is more like skateboarding the humps and dumps.

With this kind of trading (or scalping) I don’t think trailing stops are a good idea at all (as has already been said above). By definition, a trailing stop will always be actioned after a price reversal (or spike) which means a proportion of your profits is always lost. This is ok when looking for long trends but is too harsh with short moves since the TP level has to anyway be a comfortable distance away to avoid premature hits. So, with short distance trades this won’t leave much for your pocket after the trailing stop’s been hit. (which makes it hard to achieve a decent R:R)

The key issue with this kind of trading is your success rate and R:R. E.g. a success rate of 50% with a R:R of 1:1 is not going to get you rich very quickly.

It looks from your chart sample that you are entering trades almost mechanically. If so, then you might consider placing your stop beyond the most recent high/low before your entry and a TP at a sensible level (based on recent price structure) and at a distance that offers a good R:R.

You can decide on an overall generic max SL that reflects the “norm” of moves on this TF and if the nearest high/low for a particular trade is too far then you simply ignore that trade.

The logic here is that if price reverses back beyond the recent high/low then your signal was probably a fake and you are out with little damage. But if the signal is good then you reach your TP with a profit in excess of your risk.

BTW, it seems you are basing your entries on that blue-line indicator that seems to generate a string of sausages? I am unaware of that one but I wonder, have you tried using it on a higher timeframe like 4H or 1H? That could possibly give you more flexibility to move your SL and more potential for bigger moves and perhaps then change your SL to a trailing stop instead with no TP.

Just some thoughts.

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very nice comment. Unfortunately I cannot move out of M5 because the whole system and the way how all component indicators are setupped is referred and tailored to M5

Interesting. Is this system tailored only to XAUUSD or can you apply it to other instruments? I can imagine that it is designed to function with instruments that move actively and often intraday. If you can select your instrument then it might be worth trying with stock indices as well…on a demo basis, of course :innocent:

The thing that matters in such cases is your TP/SL. so when your SL is 10 pips for example the lowest TP that I suggest will be 15 pips.

I respectfully but firmly disagree. When your SL is 10 pips, for example, the highest TP that I suggest will be 10 pips.

Retail traders don’t become steadily profitable with an “R” greater than 1.0.

Professional traders typically (actually almost universally) have an “R” somewhere between 0.6 and 0.8 (I’m excluding long-term trades closer to an “investment” type of activity, of course, and talking about daytrading), and there are reasons for that.

Of course it’s completely the opposite of almost all advice you’ll read in almost all forums, on Youtube, on websites where people are selling/promoting trading services/products, and all the rest of it (but not at all the opposite of the advice given in long established, authoritative textbooks).

We all decide for ourselves by whom we want to be guided , and that’s actually the single most important trading-related decision we ever make.

More than 90% of retail traders (whoever’s figures you believe) follow “widespread, consensus advice” and never become profitable at all.

Draw your own conclusions.