Entry signal

This is a discussion on Entry signal within the Technical Analysis forums, part of the Methods category; I feel my analysis is pretty solid. I have a win ratio of around 70% (in theory). I say that ...

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Old Aug 24, 2016, 12:22pm   #9
 
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Sidner started this thread I feel my analysis is pretty solid. I have a win ratio of around 70% (in theory). I say that because my execution is terrible and end up losing when my trade idea was on the money.
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Old Aug 24, 2016, 12:25pm   #10
 
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Developing a thoroughly-tested and consistently-profitable trading plan is only a preliminary step. If one doesn't trust it enough to follow it, there's really no point in having done it. OTOH, if one doesn't trust it, there may be unexamined issues with the design.
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Old Aug 24, 2016, 12:29pm   #11
 
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Sidner started this thread Yeah that's pretty much my position at the moment. I feel my analysis is decent enough but I need to develop a better entry and exit system.
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Old Aug 24, 2016, 12:35pm   #12
 
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Entry and exit protocols are an essential part of the plan. To begin with, in order to stack the odds in your favor of a reasonably sure and profitable short, you must ensure that you have a considerable number of traders trading with you, in the same direction. This means in part that a substantial number of those who have been and are long have some compelling reason to at least exit their trades, even if they are not yet ready to reverse them.

So, if long, what criteria would you employ to determine whether or not you'd exit your trade?
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Old Aug 24, 2016, 12:41pm   #13
 
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Sidner started this thread I'd say I have that down pat given a W/R of around 70%. I can pick the moves but not the timing. I think for me it's more psychological. I find that I rush to enter a trade due to FOMO and I also find it hard to buy strength and sell weakness. The alternative is to enter early and get stopped out more frequently. I need a set of rules (say a MA crossover) that I can stick to religiously.
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Old Aug 24, 2016, 1:08pm   #14
 
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The winrate is irrelevant unless it has an accompanying robust profit-to-loss ratio. Without that, you're just racking up commissions.

And, no, the problem is not psychological. The problem is the lack of thoroughly-tested protocols for entering and exiting trades. Once you have those, you will find that rather than buy strength and sell weakness you ought to be doing the opposite if you favor reversals.

MAXOs won't save you. Begin by determining your criteria for exiting a long. Once you have that, you'll be on your way to entering a successful short.

If you decide to explore something other than trading candles or patterns or indicators, click my signature or look at my Trading Price thread in Journals.
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Old Aug 24, 2016, 1:19pm   #15
 
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Sidner started this thread Yes my risk/reward is also fine. Enough for positive expectancy.

And I agree about the protocols. However, are you saying a MAXO cannot be part of good protocol? I'm definitely focusing on this part of my system as I know it's my Achilles heel.

I'm also not sure I agree with your binary view of either being long or short. Most of the time I want to be on the sidelines, only participating when I feel there is a high probability of success.

I will check out your thread soon. Thanks.
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