Urgent input sought before opening of S&P-futures-trading on Sunday 10th of June -12

Hi everyone,
first of all I would like to apologize for posting in this part of the forum if this is the wrong place. However I very much need some urgent input before S&P-futures open on Sunday and noticing that activity in some parts of the forum is low I am posting here in the hope that I will get some quick responses and that moderators will be generous enough to move the thread later if it doesn`t belong here.

Based on an idea of where the general market is headed and support-levels I got into a significant position on Friday that averages about 20 pts below closing-price. I need some input on how to handle the trade from here.

More specifically I think the market are headed much higher and would like to stay with the trend I think will develop. However, at the same time I am not willing to give up too much of the profit. My worries are that I will get stopped out in a pullback, lets say on Monday or closer to the greek election, only to lose out on all the remaining upside.

A) I am therefore asking if a viable strategy would be to set a stop loss at a sensible level and thereafter put in an automated buy-order once the very same level is (hopefully) triggered on the way up again. In that way I can take out most of the downside risk, while still keeping the upside potential. All this will cost me is the spread on each trade as insurance. Has anyone tried this technique?

B) If I manage to stay in the trade in this way and an uptrend starts my idea is to just stay in the trade as long as S&P-futures remain above 60 MA on the daily chart, sell as it goes below and buy if it goes above again. I`ve noticed that it would theoretically have been a sensible idea in uptrends since 2009. Has anyone here combined trend-following with this kind of risk-managment?

Best regards

Hi $urfer,

In response and in my opinion (and it is just that), you could take half the profits, chop the size in half. This way if you are right then you will catch the upside and take more profit, if you're wrong you have limited your downside and given your account more leverage/money.

I cannot comment directly on your trade as for one it is personal to you and your specific strategy, I also do not know what your risk/reward is so I have no idea on what is a good hit or not. I can only assume that if you are looking to take profit (possibly through fear) at this level and your profit is 20pts (meaning you bought at around 1310) I would expect your stop to be around 1300. This gives you a standard ratio of 2:1. This would also be understandable as a possible support area, although I personally don't see it on the graph doesn't mean that it couldn't support should the market head downwards.

In principle I would question why you are looking to divert from your trading strategy. In short what has changed between yesterday and today that has wobbled your strategy. Also how sound is your strategy that it can be shaken within 24 hours, understandable if war had broken out or towers had collapsed but the last 8 hours trading has brought nothing out of the ordinary and certainly nothing that wasn't on the cards so to speak. If anything its been very positive, hence the market move upwards. This isn't to say it will continue as I have no open opinion what will happen next, I can only make predictions and those I will keep for myself and my own trades.

Hope this helps.

Happy trading,
Lee Shepherd

In principle I would question why you are looking to divert from your trading strategy. In short what has changed between yesterday and today that has wobbled your strategy. Also how sound is your strategy that it can be shaken within 24 hours, understandable if war had broken out or towers had collapsed but the last 8 hours trading has brought nothing out of the ordinary and certainly nothing that wasn't on the cards so to speak. If anything its been very positive, hence the market move upwards. This isn't to say it will continue as I have no open opinion what will happen next, I can only make predictions and those I will keep for myself and my own trades.


Lee Shepherd[/QUOTE]

Well said Lee,leave well alone.