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Walter - I suppose, I would look at like this:
On counter-trend trades, consider getting some/all off after an acceptable move in your direction knowing that you are going against the flow. There's money to be made here, no doubt, but my personal opinion is that you cannot get greedy in counter-trend trades.
On trend trades, I would consider allowing the trade some more room to work for larger profit potential. I personally have found some great success with WRB's, so perhaps that's a consideration.
Of course, if you can scale out as well, that's another component for consideration. I am a big fan of scaling out if your account size and risk tolerance allows. |
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yes Brown, I never take counter trend trades against momentum conditions..
when market is in cyclical mode (mostly) the extreme of the cycle or coil gives you a good place to trade, obviously thats counter but you are not going against a great strength in course, because there is no momentum...
I must say that most of the times you are in the right side of the market, the poor trend trader is just exhausted trying to beat the cycle conditions, he always gets late, he makes party when there is momentum, but that happens very few times per month....
so on cycle conditions you want to be counter... it takes ba...lls to trade in congestion, but when you get used, and have a method, cant stop trading it...
Now on this Flip trade we have diferent context situations, they may be trendwise wich would suggest the continuation of trend and maybe the buildup of momentum....
or counter, wich would cycle back to equilibrium on the average zone...
depending where you are in relation to the "average"...
For a momentum flip I would suggest to stay as much possible, for a cycle flip I would close the entire position on the area of the average...
cheers Walter.