DislikedThanks Ogre , good stuff, we all should do that routine .Do you plan to disclose some info about your trading system how are you able to handle this wild 1 min beast? DanIgnored
How I handle the 1 minute beast? I have a different approach and thought process than most who attempt to tame the beast. My goal, once I enter a trade, is to find a good opportunity to move my stop to break even. Once I do, I really don't care what the market does. It would drive my former business partner nuts that I could watch a trade get up 50-60 pips and then have it come all the way back to break even and not take any profit. But when you compared end of the month statements I would always blow him away with % gained with the same risk he had. Now, why is that??
Let's say the trade had 10 lots in it. He would take profit fairly quickly starting at about 25 pips and every 5 pips after that until he was down to just one lot left, then he would let that 1 lot run. This would happen fairly quickly as he was shedding about 50% of the remaining position every 5 pips. He was completely frightened of the market. He was scared to death that the market would turn and take him out and he would have a losing trade. He is a great trader and can analyze the most complex charts you have ever seen, but once he entered a trade he just knew inside that the markets and/or the brokers were going to take out his stops. Mentally he would just go into a fear of loss mode.
Now, for the renegade..... ME! Enter a trade with the full amount of 10 lots and then just wait........I know I cannot control the markets so what the markets do is entirely up to the market.........I don't focus on being wrong I already know that will happen I just don't know which trade(s). Take a look at the attached chart. I entered on the red arrow inside the green box. The price flirted with the blue line for a bit then headed down. While most people would be super happy with that move down, I am looking for another sign that the trend will continue. Do you see how the price moved down then gave me a nice swing high, then turned and headed down again? Once it started back down again, it's at that point I move my stop to break even. Now I can't lose, no matter what happens the worst will be a break even. If you think I didn't care what the markets did when I first entered a trade, you should see me now! LOL!
So now what?? I turn my focus to finding a decent place to exit the trade. Am I looking for a bottom in this case? Not really. I learned early on if you try to pick bottoms, all you get is smelly fingers. If my stop is at break even and there is a major news announcement coming up, MAN! I LOVE THAT!! I just let it go and I find that a large majority of the time, the trade really takes off with the news.
People get too hung up on "after X number of pips I move my stop to break even". Usually it is something stupid like break even + a few pips because heaven forbid that you should break even on a trade, that's like losing!! ROFL! Let the markets decide when to move your stop to break even not some arbitrary number. The markets are different nearly everyday, shouldn't you be also?
I will post more later, hope this helps.