I took a chance on G/U, from backtesting I know that usually there are good moves in situations like this. Anyway I'm happy with my 25 pips.
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DislikedI took a chance on G/U, from backtesting I know that usually there are good moves in situations like this. Anyway I'm happy with my 25 pips.Ignored
DislikedI took a chance on G/U, from backtesting I know that usually there are good moves in situations like this. Anyway I'm happy with my 25 pips.Ignored
DislikedThat situation was putting the odds in your favour. If 10 such situations occur I think that 8 of them will work out.
Well done.Ignored
DislikedThat situation was putting the odds in your favour. If 10 such situations occur I think that 8 of them will work out.
Well done.Ignored
DislikedI want to put my two cents on the entry point discussion. This question bothers me for quite a long time already. If you trade with one lot there are no problems as you calculate your trade on R:R basis, as soon as you start using two lots you have to face a dilemma.
In profit you close your lot at +25, and I like it, as I already have some pips in the pocket, and as Phillip has pointed out you can also use it as SL for the second lot to come to b/e if price turns against you, to give your position a chance (I started to use this technique too, and find it very useful).
On the other hand if you lose, you'll face a double stop. What I have noticed is that I was often closed at +25. So if I have 4 winning trades in a row I earn +100. And then comes one loss and I lose -72 (let's say -36 on one lot and -36 on the second). You see my point here, I have 3 winning trades and one loss to take them out. Not good MM. The only way out here I see to have much more winning trades than losses, let's say 8 out of ten (Phillip's winning % is even better), but for newbies it's hard to achive.
Then I started to test, 1st lot +25 SL -25, the other lot as usual, and found that not very good too. There is no use to put SL in the middle of the candle, as there are no boundaries for price. Often price would run -25, taking your SL on first lot and then go all the way back. You would still have profit on the second, but less as you have already faced SL.
Lately I have come to much better entry managment. If I can put small SL (there are some boundaries above or below which I can use to hide SL) I open two lots. If SL is big (more than 30) I open 1 lot.
Reading the above posts I have found many interstting ideas as to the entry managment, I need to think about it.Ignored
DislikedHey Ira, i was waiting for your sensible 2 cents, thanks for that.
It certainly is an interesting discussion. But i wanted to make one last point and that is that it is psychologically and emotionally very very important not only to have consistant gains but to keep them, more important than maxing out the system. The next step is making consistant gains and then accepting that they may be taken away which is a hard lesson in itself, because we dont wish to lose what we have gained.
However, from my own point of view, if i can achieve consistancy and increase my stake this is worth more at the moment that maxing out the system with more lots - unless i can get better at recognising better set ups and putting more on, like Ryan does.
A great dicsussion though.Ignored
DislikedSo, we have an idea to close 50% of a trade at about +20..25 pips. So we are speaking about 1 trade or position and closing a part of it with a minor profit. What does that give? This makes % of profit trades higher (or % of losses lower), and at the same time it makes average profit (pips/1lot) smaller. You all must know a simple formula that describes the expectation (E) of a trading system: E = %profits*av.profit - %losses*av.loss. Parts marked green become "better" and with red - "worse". In fact, without knowing those values (%profits etc) for specific system we can't say if such a method will improve its results or make them worse. I'm gathering some statistics and in a few days hope to return to this question with maybe some numbers.
But besides the maths above there are several other things about this system of position handling:
- for me doing like Phillip showed (closing 50% at about 20 pips) is psychologically more convenient (which sometimes may mean more than bigger profit in the end);
- as this first small target is not "hanging in the air" but usually near some barrier at which price may turn around it becomes even more reasonable.Ignored
Disliked... The great thing about trading is that everyday is a challenge. Everyday there is something new to learn and what we already know is being pushed to its limit. Their is no room for complacency here, and above all we learn about ourselves because trading, like much of life, is a mirror in which we see our selves.Ignored
DislikedI use a money management system based on % risk.
I'm conservative with my risk so for now it's 1% for each trade.
So if I put in $1,000, my risk is $10.
If the stop loss for the specific trade is 50 pips, the pip value is 20 cents, the equivalent of 2 micro lots.
If the stop loss for the specific trade is 30 pips, the pip value is 33 cents, the equivalent of 3.33 micro lots.
When I can manage a reasonably small stop loss based on price action, I'm rewarded with a larger position and thus bigger profits, while keeping the risk always to 1%. (and with practice maybe increasing it to 2%, and/or increasing capital)
So that way I'm not concerned about having a position I can't manage emotionally, as on every trade my risk is always 1%.
Still the problem of when and how to take partial profits remains, like ira said, as the stop loss will be hit with the full weight of the position, whereas taking partial profit means that the impact of profits become less compared to the stop loss.Ignored