What kind of exit indicators do peope use to exit when trend following?

This is a discussion on What kind of exit indicators do peope use to exit when trend following? within the Trading Systems forums, part of the Methods category; Just enquiring what kind of exit indicators do people use when letting proifits run until a breakdiown of a trend? ...

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Old Jan 19, 2015, 1:51pm   #1
Joined Apr 2014
What kind of exit indicators do peope use to exit when trend following?

Just enquiring what kind of exit indicators do people use when letting proifits run until a breakdiown of a trend?

I've just started using the 50 ema. I trade daily charts and like to get to breakeven using various S&R points....and then let teh 50 ema catch up to breakeven and i then trail that for an exit strategy.

I suppose it makes no difference really. Or does it?

In my own head im thinking an instrument can bahave anyway and we can only tell with hindsight what the best indicator to use.
So as long as i am using some indicator that keeps me in a trend while its going in my favour - anbd gets me out when the trend breaks down then im thinking i cant do any more than that.

Am i oversimplifying this? Or is teh above a fair analysis?
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Old Jan 20, 2015, 10:34am   #2
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Lower lows
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Old Jan 20, 2015, 1:45pm   #3
 
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An indicator I like to use is ADX. It's used to measure the strength of a trend. Seeing as you are trend following and want to stay in the trend as long as it's strong then an exit could be when ADX drops below 25 for example.

You'd have to test what levels work best for the timeframes your trading in.

How are you entering the trend in the first place Adecco?
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Old Jan 20, 2015, 1:50pm   #4
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Originally Posted by jgtrade View Post
An indicator I like to use is ADX. It's used to measure the strength of a trend. Seeing as you are trend following and want to stay in the trend as long as it's strong then an exit could be when ADX drops below 25 for example.

You'd have to test what levels work best for the timeframes your trading in.

How are you entering the trend in the first place Adecco?
I basically enter if i see an obvious trend. Nothing too fancy - just a basic cursaory look at a chart and if it has been on an obvious trend for teh last num ber of weeks/months then i get in.
I normally use a nearby S/R point - or a MA of some dexscription as a Stop loss. Its subjective really i guess depending on teh instrument anbd what indicators are nearby. (I try to have my SL between 5% and 10% away normall)

But basically i try to get my SL to breakeven as soon as i can if there is any technical reason availabekl for me to do so.

And after that its just a case of seletcing soem random indicator to get me out of a trend - hencer thsi thread.
I guess theres hno great indicator - as long as you have something to keepo you in in a stroing trend - and that gets you out in teh event of a trend breakdown.

But i was just curios what pothetr people use.

My excit can change depending on how teh instruiment behaves.
E.g. if a sharp move against me i woudl stick with original MA exit - but if my MA slowly catches up with price i may change to a slower MA.
Some you win and some youlose yusing thsi method. Proibably evens out overall.

Maybe i woudl be better using teh same exit ebverytime though to avoid any stresses in selecting teh exit.
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Old Jan 20, 2015, 2:04pm   #5
 
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"Maybe i woudl be better using teh same exit ebverytime though to avoid any stresses in selecting teh exit."

My best advice would be to know exactly what indicator you're going to use to exit the trade BEFORE you even get in the trade.

You should keep the exit strategies consistent until you know what works and what doesn't work. I would suggest something simple to try first like a moving average cross over to take profits. Then keep the stop loss further away, well away from market noise. Use lower lows or "donchian channel" for the stop.
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Old Jul 10, 2015, 10:11pm   #6
 
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I would suggest looking at the ATR Trailing Stop
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Old Jul 10, 2015, 10:43pm   #7
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I use ATR to start with and if the trend continues I go on to a break of lower lows.
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Old Jul 11, 2015, 11:56am   #8
 
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Take near term volatility into account. ATR is a very blunt instrument. But tbh, if we're talking calculated indicators, don't use any of them, all sh1te.
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