what is a trailing stop-loss?

This is a discussion on what is a trailing stop-loss? within the First Steps forums, part of the Reception category; Hi blyon As usual there is no one answer. A lot depends on what you're trading and also you're typical ...

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Old Jun 12, 2003, 5:13pm   #16
 
The Beyonder's Avatar
Joined Apr 2003
Hi blyon

As usual there is no one answer.

A lot depends on what you're trading and also you're typical holding period in time.

Also your own pain threshold will come into it.

I day trade the Dow and find that 25pts is quite good, I also use the centre line of Bollinger Bands after a good run (assuming I make one)
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Old Jun 13, 2003, 11:11am   #17
 
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Thanks Beyonder...

I suppose that I should continue to paper trade for a while longer until I determine what feels right. I think what I am finding is (like you mentioned) it depends on what you are trading.

I was under the impression that many traders had one method that applies to all their trades, but after speaking to other traders, I now understand that isnt the case, and that I will most likely have to be flexible depending on the type of trade..

...still learning! thanks for the input
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Old Jun 13, 2003, 3:55pm   #18
 
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When you line up to trade, you have a reason. ie you're maybe looking for 30points. You have have decided why you want to enter. Has it broken a trend line, is it running into resistance, have your MAs crossed, or whatever your analysis has shown you. You MUST have also worked out at what point you're wrong. So when does the market say your analysis is wrong? If it's more £$ than you're comfortable with, then it's not your trade.
You must know your "out", your loss, before you enter!

Good luck
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