[keymoo]

Hi there,

I am currently developing a trading plan based mostly on work done by Martin Pring on price patterns, price action. I am looking for the market to signal to me turning points, reversals using price action in confluence with other longer term price patterns and support/resistance levels.

Can you recommend any resources on exiting trades? I preferred style of trading is to scale in on longer term charts and then look for an all-out exit. I much prefer this over all-in and scale out as it is less risky. I have written about a potential setup on Platinum Futures here on my blog and I find it easy to get into a trade but not sure where to get out.

Thanks for any pointers.

keymoo

[brownsfan019]

I just told someone in an email that exits are the worst - you will always be wrong - either out too soon or out too late in hindsight.

As soon as you accept that you will never got out at the high or low of a move, then it gets a little easier mentally.

IMO exits are the hardest mental aspect of this business b/c you constantly see what if's that revolve around more $ in your account.

[keymoo]

Thanks brownsfan - that's exactly what I am experiencing. However I would like to develop some kind of exit strategy and then follow it. I would rather the market tell me when to get out than use fixed targets because fixed targets, although good from a discipline point of view, tend to get you out of the market too early on big moves. If the move is over then perhaps I should just use a short signal to get out of a long and a long signal to get out of a short?

I am not obsessing about capturing the entire move, just the "meat in the middle" as they say.

What do YOU do?

[keymoo]

How about just using a trailing stop? If it is set just outside normal noise levels then it should be able to ride a trend. For instance on the "other forum" a guy called Jacko uses a 50 pip stop on EUR and let's the trailing stop take him out of the trade. I guess that is one option that could be looked into and tested.

Does anyone else want to share their exit strategies?

[SIUYA]

There are many types of exit strategies and no right or wrong answer. If you let the market get you out with a trailing stop, then you have to run bigger drawdowns in the PL from peak to trough, profit targets will get you missing the big moves. Its all a trade off - each has its advantages and disadvantages.
Some other ideas are to take partial profits and let the rest run with a trailing stop.

In a previous post I read somewhere here someone made a great point.....
ensure the entries and the exits MATCH and make sense for the strategy being applied and apply them consistently.
to me that is a great piece of advice.

[TheDude]

I usually have a level in mind as to where the market should get to. I the market looks weak, I will cut the trade, or bring a stop up just under/above the structure to give it a dogs chance. If the market looks very strong, I will hold and see if we go to the next level beyond that.

Looking at ES today for example, it would seem clear the day trend is up. My level (given the gap down) would therefore be yesterdays low. Now, there aint a chance in hell that were going to make that. This is a 2 time frame market and looking at the order flow, there seem to be plenty of sellers - probably longer term traders, while the rally is probably being driven by profit taking from the shorts. Just irrelevant opinion of course. The important thing is that the market is far to back and forth to make a nice move up to yesterdays low. My exit from a long then is going to be based on typical length of recent up swings. That will be the level I will use.

As Brownsfan wisely said, it's pointless worrying about too early/late. Just look at the numbers and figure it out.

I dont worry about shapes, patterns, fibs, trailing stops etc. Too mechanical.

(Im no expert though - I often get it badly wrong!! )

[brownsfan019]

Originally Posted by keymoo »

How about just using a trailing stop? If it is set just outside normal noise levels then it should be able to ride a trend. For instance on the "other forum" a guy called Jacko uses a 50 pip stop on EUR and let's the trailing stop take him out of the trade. I guess that is one option that could be looked into and tested.

Does anyone else want to share their exit strategies?

Trailers work great in a swift trend - otherwise, you can get ticked out like crazy.

The simplest approach is a fixed target. One way to do this is to view your risk and say your profit should be some multiple of that to justify the trade - If risking 10, should go for 15 or more.

There's no right or wrong answer and nothing will be perfect. Exits are my biggest mental crutch b/c hindsight trading is so easy.

[Tams]

Originally Posted by keymoo »

Hi there,

I am currently developing a trading plan based mostly on work done by Martin Pring on price patterns, price action. I am looking for the market to signal to me turning points, reversals using price action in confluence with other longer term price patterns and support/resistance levels.

Can you recommend any resources on exiting trades? I preferred style of trading is to scale in on longer term charts and then look for an all-out exit. I much prefer this over all-in and scale out as it is less risky. I have written about a potential setup on Platinum Futures here on my blog and I find it easy to get into a trade but not sure where to get out.

Thanks for any pointers.

keymoo

.......... try a bollinger band.