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Old 10-28-2007, 02:34 PM
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Re: Help with Stops

There is only one answer to your dilemma. That is don't use stops! I know that is absolute heresy to some but it doesn't mean you don't stop out loosing positions. Actually a useful paradigm shift can come out of this. You use your tools to tell you whether things are playing out as anticipated and if they are not you close or reverse. People seem to put all their effort and levels of sophistication into there entries and use really crude tools and concepts for exits.

What might be a bit less radical and so more use to you is use a volatility based stop (ATR or chandelier springs to mind).

Finally you could look at winning setups and maximum adverse excursions you usually get a sweet spot (or two) where to increase your winners a small amount you have to widen your stops considerably.

Final thought, if you do use fixed stops (either based on market structure, a point amount or some sort of technical like ATR) they will take you out of good positions as well as bad ones. Thats the price you pay for having protection.

Seems to me its far from a newbie question!

Cheers.

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