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The question boils down to this: at what point do you know you are on the wrong side of the trade? Does you stop have to be hit for you to know that?
Why not one tick before? How about 4 ticks before.
At some point prior to the stop being hit, you know you are on the wrong track. Why not exit at that point? |
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I am wrong when my stop is hit. Not one tick before or one tick after. That's it. Until my stop is hit, I am not wrong, even if the trade is in the red currently. A loss does not become real until the stop is hit or until a trader hits the flatten button prematurely.
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I guess I should of mentioned I also believe in UNDER TRADING IN BOTH SIZE AND FREQUENCY.
Hence I talked about entering at the right time to avoid the need to exit during the sideways action. Also note that I did not say jump aboard the market in the opposite direction. Here we are talking as if you got the direction right, just not the timing. Get out and wait. but be nimble. |
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So, we want to be nimble and exit trades quickly, but also under trade? If you are quickly hitting the flatten button and then quickly re-entering, I believe that's the opposite of under trading.
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And again, Pit traders are not worried about commissions. As I said, these two gentle men are pit traders. |
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I understand that, but as RETAIL traders commissions are a factor, especially based on what has been negotiated. We are all retail traders here, not pit traders, so to ignore commissions is a mistake in my opinion. If you are trading the YM and paying $5 round trip, you've just added another tick to your stop losses. To me, that's something that needs consideration.
Until tomorrow, good trading everyone. Time for this trader to get off the computer already!