Knowing When to Enter vs Getting a Good Price

All

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

Is there any difference?

DT

Why are you asking? Are you trading?

ronblack said:

Why are you asking? Are you trading?

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It's a trading forum. We discuss trading issues.

Why are you here? Got no friends left in real life?

DionysusToast said:

All

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

Is there any difference?

DT

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I would say they're the same?

I wait to enter the market when I believe i'm getting a good price. As an uptrend develops waiting for a pullback ( I know this is when I should enter & I believe this makes it a good price ( the best price ).

If by '..getting a good price..' you mean getting a good fill - well that's pretty much out of our hands., so that leaves '.. knowing where to enter...' as the greater skill ? If not, they are probably one and the same ?

G/L

DionysusToast said:

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

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Depends on your trading. If you're a position trader, entry is more important than getting the best fill because a few ticks won't matter much in the grand scheme of your profitability. If, however, you're a scalper or someone else looking for small profits, fill could be very significant in your performance.

DionysusToast said:

All

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

Is there any difference?

DT

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IMHO. Theres no knowing and a good price only exists in hindsight! All you can hope to do is manage your risk.

DionysusToast said:

All

Which is the greater skill do you think?

Knowing when to enter the market or get(ting) a good price when you enter?

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as a premise, they carry equal weight, for me as a skill......they are rarely balanced as an influencing, from my pov............the time bulls-eye is rarely hit and the price bulls-eye is rarely hit, as an absolute, as that is the fluidity of the auction versus how fast i can read the play, so, the probability that i'll hit both at the same time is even further away and i'm still satisfied that that's ok, in other words "seen the action, the timing is right, pull the trigger, or, "seen it, time is wrong, don't pull the trigger".......one thing is often clear, when a price should hit a zone based on the background influence of the year, quarter, ops expiration, bond actions, holidays, window dressing, mutual funds buying/selling, open 30, closing 30, lunch, timed-release set-ups (news) and for stocks ; earnings, divis, cap raising, splits, what percentage of issued is short-sold.....all these are relative to liquidities and creat their own context.....an endless list.....in each one of those instances there is a trader who has an agenda with different size to mine.......understanding when that/those traders are most/least active is a pre-trade priority.......i'm not giving away any edge here...... alluding to a point made several posts ago by DT on moving from a set-up with a black box mentality to a point where we look back into the auction and who's on the other side .......the thing is, everyone has a black box in that they have a criteria (extent of knowledge) and allowing that set of criteria to be active, of itself, defines how effective and affective the results are

......reading the tape has as much to do with reading time as much as reading price

i think knowing when to give weight to one or the other is an art that most people refute because it requires a great deal of hard graft which most are rarely prepared to give in to......


ideas

I think they are both as important and as skilful as each other.

They must be the same thing surely? This is a trick question isn't it?

If, looking ahead, price was going to attain an unfavourable level on the entry signal in terms of r:r, the signal would be invalidated. If the entry point is reached and price is good but you hold off entry in the hope of a better price, of course, price may go your way and assist your r:r, but it would more probably (not equally) go the other way, i.e. the direction of your putative trade, which is what you 'predicted' would be more likely, so you would be likely to get a worse price or no entry at all by delaying beyond the moment of signal.

Finessing the entry price seems like trying to hit high and low reversals, but in miniature.

PS. I also admit to a blindness with regards running profits, another one of those trading techniques I think can only be practised in hindsight.

That's a very good way of looking into it, I must admit.

DionysusToast said:

All

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

Is there any difference?

DT

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At the institutional level, the skill is in managing the entry. It's a trade-off between timeliness and market impact.

The way it's done is to estimate a normal market size within which an order is judged to have no informational content and so doesn't move the market. By splitting the order it is possible to have no market impact, but this exposes the trader to market risk.

DionysusToast said:

Why are you here? Got no friends left in real life?

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Thats why I'm here. No friends. I'd imagine most traders here prefer to sit in front of their computer staring at blinking numbers than interacting with people.

Gordon Gekko said:

Thats why I'm here. No friends. I'd imagine most traders here prefer to sit in front of their computer staring at blinking numbers than interacting with people.

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Actually I think traders need to earn money so that they can pay to 'interact' with people...

DionysusToast said:

All

Which is the greater skill do you think?

Knowing when to enter the market or getting a good price when you enter?

Is there any difference?

DT

Click to expand...

I think that there is, if only for the waiting factor. This is one reason why I use averages when attempting to go with the trend. One can get the right price and then it goes sideways for hours, sometimes, before it moves. If one waits until it gets to an average, at least, one's money is in his own account and not in a stuck trade if something better comes along.

I'm a trader who does not keep a lot of money in his acccount, so it needs to all work. I don't have enough in there to trade more than two instruments at a time. A stuck trade is a nuisance to me when I could be doing something else.

Getting a good price? Sounds like something only an investor or long-term trader would say.

For us mortal day-to-day traders, knowing when to enter is much more important. Is it going up in the next few minutes/hours? Down? Getting a good price here is more or less irrelevant. You'll get your good price if your entry is just as the new trend starts, and a lesser price if your entered in the middle of the trend. It's all perspective.

I would say there is no difference.
Market´s balance is determined by price. This is specially true at highly liquid markets.
So to get a good price means to enter into a position.

"Knowing when to enter the market or getting a good price when you enter? "

Knowing when to enter. It's a far more ethereal area especially when you get to the point of seeing the small clues of change (subtle accumulation) rather than conventional confirmation signals where you are proabably already too late for the move. Also missed/late trade opportunities have a far more damaging effect on P&L than being off a few ticks/points on entry.

Ultimately it boils down to trade location vs confirmation. Entry efficiency is secondary and part of the execution rather than the trade selection process.

Example. You see evidence of buyers entering the market on the daily after a sell-off but on a chart, the swing low has not formed. If you get in without the 'chart signal' forming purely based upon MP/DOM/T&S, you are probably 10-15pts (ES) on side by comparisson to waiting for the swing low to form. If you waited for confirmation like many people do but with a good entry, maybe that gives you 2pts back. I'm still a dozen pts better off though.

There are differences between the two, "knowing" comes from understanding and "good price" comes from imagination of your mind.
Knowing takes greater skill because it takes self perfection where good price is guesswork towards the other end of the scale!

Triggerfish said:

There are differences between the two, "knowing" comes from understanding and "good price" comes from imagination of your mind.
Knowing takes greater skill because it takes self perfection where good price is guesswork towards the other end of the scale!

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we hear the orchestra playing, alas, Horatio, the tune is unknown.....expand on your imaginative knowing