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"Letting profits ride.."

  • #1
  • First Post: May 11, 2008 9:28pm May 11, 2008 9:28pm
Obviously we are looking for maximum extraction out of the market, however if time constraints only allow us to check price levels and charts at a specific point does this constitute "closing prematurely" and "not cutting losses short" (if, in our opinion, it is time to exit and we do) ?

Opinions?
  • #2
  • May 11, 2008 11:33pm May 11, 2008 11:33pm
Quoting renegade7
Obviously we are looking for maximum extraction out of the market, however if time constraints only allow us to check price levels and charts at a specific point does this constitute "closing prematurely" and "not cutting losses short" (if, in our opinion, it is time to exit and we do) ?

Opinions?
When people say "cut your losses short and let your profits run", the key point to understand is to try to ensure, over a large series of trades, that your winners are larger than your losers.

You can't watch the markets all the time, but you can set limits. "Closing prematurely" only happens if you close before you plan to close. If you have a set limit, let's say x amount of pips or a specific price, then any close before that is premature if it's not part of your plan. If you use a trailing stop and your stop is hit and the market then moves another 500 pips in your direction, then it's not a premature close, it's just trading and the nature of the markets.

Having a plan every time you place a trade is essential. Without one, you've lost the moment you placed the trade, even if any one trade wins or loses.
  • #3
  • May 17, 2008 1:48pm May 17, 2008 1:48pm
I have mixed feelings on this. Some just take slices out of the trend with heavy leverage and others try to find tops and bottoms...

I suppose the closer you can get to riding market movement would reveal accuracey to a chart reader.

To a trader the bottom line is what counts. You trade to make money.

To a professional its the drawdown that matters as his world is filled with accredited investor and Institutions.

I am not answering your question or even revealing an opinion as I am not profitable and do not know and I have been each of the three above.

ES

Quoting renegade7
Obviously we are looking for maximum extraction out of the market, however if time constraints only allow us to check price levels and charts at a specific point does this constitute "closing prematurely" and "not cutting losses short" (if, in our opinion, it is time to exit and we do) ?

Opinions?
  • #4
  • May 17, 2008 2:01pm May 17, 2008 2:01pm
Quoting renegade7
Obviously we are looking for maximum extraction out of the market, however if time constraints only allow us to check price levels and charts at a specific point does this constitute "closing prematurely" and "not cutting losses short" (if, in our opinion, it is time to exit and we do) ?

Opinions?
By definition, yes.
The breaking of a wave cannot explain the whole sea.
  • #5
  • Last Post: May 17, 2008 2:33pm May 17, 2008 2:33pm
Quoting ElectricSavant
I have mixed feelings on this. Some just take slices out of the trend with heavy leverage and others try to find tops and bottoms...
I think most institional traders fall on the first group. Take slices, VERY large leverage, No Stops and Limits! and possibly aim for a daily goal. I trade that way too...
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