I have a question about stops

R

Rick Merritt

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• Nov 21, 2008

• #1

I have a question about stops:
I am trading ProShares (bear & bull )2X ETF's using 3 to 5% Trailing stops. I am getting whipsawed quit a bit. What is the best way and place to set stops in this crazy market on 2X and 3X ETF's.
Thanks,
Rick

 

arabianights

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• Nov 21, 2008

• #2

in a nutshell, set them where your trade would be wrong.

And if you can't do that through prudent money management, then don't trade.

 

R

Rick Merritt

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• Nov 21, 2008

• #3

arabianights said:

in a nutshell, set them where your trade would be wrong.

And if you can't do that through prudent money management, then don't trade.

Click to expand...

I appreciate the response. I think you are saying, don't set your stops so close that it doesn't hurt a little if you get stopped out. I understand prudent money management and have no problem taking a hit. I have been using Trailing Stops. Is it better to use hard stops.

Thanks again

 

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chunjr

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• Nov 23, 2008

• #4

In these type of markets, widen your stops, but reduce size. If you can't do that, move on to a different instrument where you can do this. Fastest way to deplete a trading acct is to over leverage!

 

new_trader

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• Nov 23, 2008

• #5

chunjr said:

In these type of markets, widen your stops, but reduce size. If you can't do that, move on to a different instrument where you can do this. Fastest way to deplete a trading acct is to over leverage!

Click to expand...

Define 'these type' as used in your sentence - "In these type of markets"

You're not going to say 'volatile' are you?

 

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chunjr

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• Nov 23, 2008

• #6

The OP said he was being whipsawed. So yes, I meant volatile. When the ES retraces 8-10 handles on minor retracements, let alone 90+ point melt ups, what else could it be?

 

arabianights

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• Nov 23, 2008

• #7

Careful chunjr, new_trader is about to claim that in markets with 1/20th of the liquidity, a random order won't move it any more than previously... and therefore you can predict entries with the same precision as before!