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Re: Range Trading
It's funny that as I became much more involved in active trading from years of investing, my targetted system was to trade ranges occuring over days and weeks in stocks that were consolidating. I felt I could better play "between the sheets" than breakouts. Using mostly fib retracements for the trades, I filtered those with heavy volume and consolidating with stockfetcher. The system was profitable, but risk to reward was hard to determine and many trades ended up lasting 2 to 3 days longer than anticipated which made for some uneasy nights.
As I reviewd the 700 plus trades over a few months, one thing became clear. I was calling tops and bottoms and those that brokeout (or down) seriously hampered my gains.
So, my sytem has since been refined to trending stocks. I do trade range bound swings intra-day as they present themselves with fib retracements. That remains profitable, but only with very tight mental stops.
My $.02
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