Risk Free Trade

[wsam29]

meh, I've come to terms with stuff like that. It does not bother me like it used to.

I just look in the mirror and know who to blame.

[Rocky Mtn Trader]

Here is what I've been using on stops and targets.

Lets say your trading 2 contracts on the ES.

My stop loss is -1.5 points on both. Worst case scenario....-3.0 loss

My first target is +1. After this, I move my stop to -1.25 or -1.0 or -.75. In other words...I'm still giving the trade some "wiggle" room, and if I get stopped out, the loss is minimal.

If you are getting in your trades at the right time, getting covered at +1 on your first contract is a high percentage. It also is good on the phyche.

After the trade is moving in the right direction, I move my stop to B/E when it gets to +2, +2.5 or +3.0. I also watch where retracements are to move my stop with the trade. I have found that I'm better to take +3 or +4 on my 2nd contract, than have the trade move back to -1 and stop me out. That drives you nuts.

My 2nd contract target is +5. If I don't get much heat on my entry, then I know the trade has a good chance to move +5 points. If I take -1 heat, then I usually take + 4 profit. A lot depends on what action is happening toward the end.

I have found that if I move my stop to B/E too early, sure enough it will come back and stop me out. On the ES, once the trade gets past +3 points, the retracement back has a good chance from never reaching your entry.

Bottom line...The market does what it wants to do. When I get a lot of heat right from the beginning, chances are this was not the best entry and I'll get stopped out regardless. Part of trading.

Like Soul Trader, my problem is getting out too early and not let the winners run.

Try this sometime. If your Sim trading....get in a trade, after you cover your +1, move your stop to -1 or -.75. Figure where your profit target "should be", and then get up and walk away. Do this a couple of times...you will be amazed at how often this trade will pay off.

If your trading 4 contracts...target first 2 contracts at +1 points, 1 at +2.5 points, then move your stop to B/E, and let the 4th contract hit your final target. This trade actually has better ratios than using 2 contracts. You may get stopped out on the 4th contract at B/E, but you get your 2 at +1 and 1 at +2.5 a lot of the time. That's a +4.5. You will also be surprised how many times you get +9.5.

Hopefully this might help someone.
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[solfest]

I trade crude oil and have always used a BE + 1 stop. I am only trading one contract and do not use a target for exiting the trade.

So I find that getting to BE helps to give me some "emotional capital" to stay with the trade as it is now theoretically risk free.

I have not done the statistical analysis I should have on this but my memory database (which is flawed) keeps the BE move in the plan.

I am trading range bars and go to BE + 1 after 13 ticks, the size of the range bar traded.

http://tradingcrude.blogspot.com/