Buy / Sell: wheres the Stop Loss?

trendie

Legendary member
6,732 1,297
Been toying with another game.
I was curious about entry signals, and sometimes the stress/anxiety some may feel about entering a trade.
So I thought, what if the entry is taken out of your hands, and your job is to manage the trade.
(this may have been done before)

At random two trades trigger. One is a Buy, the other a Sell.
The two trades are entirely independent.

What is your analysis of the Buy? 1.3758
Where would you put the Stop Loss?
Where do you anticipate a Take Profit?

What is your analysis of the Sell? 1.3758
Where would you put the Stop Loss?
Where would you put the Take Profit?

Would this type of process teach newbies the art of analysing market structure?
gbpusd-apr14.PNG
 
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tomorton

Legendary member
8,326 1,314
Its an intriguing idea. Reminds me of the chess problems you used to see at the backs of newspapers: the reader inherits a position and has to fight their way out. The learning comes from the analysis of what can be done, against an actual or theoretical development A good way of teaching.
 

trendie

Legendary member
6,732 1,297
Here's my attempt.
Stifle your laughs, please, I am not a market structure type of trader, although I have general awareness of it.
(the two analyses are mostly mirror images. I am looking to firstly identify a point of no return where the trade fails / profit point where the trade wins, then look to finesse either the stop loss, or take profit by identifying potentially newly forming Sup/Res, and refining my SL and TP accordingly)
Buy:
B: Point B is failure of trade, if it breaks below, then too much resistance above to recover.
A: If it ranges in the green box, there is a chance it might bounce upwards, but if if now fails then its likely to hit B, so exit if it drops below green box here, earlier stop-loss exit.
C: if it bounces of green box and goes up, fails to get back into entry point, then A is the new stop-loss, and dont wait for it to hit B.
D:direct move to Profit point.
E: if it meanders at point E, tighten take profit, in case green box is resistance, and drops.
F: if market moves to F and falters, then move stop-loss to entry point, and likely resistance.

Sell:
** stuff it, just uploaded the Sell, you can work out my thinking by looking at above!! **
gbpusd-apr14-buy.png
gbpusd-apr14-sell.png
 

trendie

Legendary member
6,732 1,297
USDCAD:
Your boss comes in and tells you the boffins have triggered a buy at 1.2541, and you are to manage the trade.
Without knowing the reasons for the entry, how do you manage the Buy, with regards to SL and TP?
Your other boss at the hedge fund you're trading at, comes in and tells you his boffins have entered a Sell at 1.2541, and you are to manage it. What are your SL and TPs?

(As an aside, I have always been used to carving out the sessions into boxes.
Probably my imagination, but cant help notice how the US sessions (pinky) seem to be the intra-day source of Sup/Res.)
usdcad-apr15a.PNG
 

CavaliereVerde

Experienced member
1,398 1,801
It is the mystery of charting.
If you visualize 100 bars you draw some lines, if you show 500 you draw other lines.
The point is that what we have on the chart is 99%+ random with a significance close to 0.
Have you ever seen a hedge fund boss charting? ;)
 

trendie

Legendary member
6,732 1,297
It is the mystery of charting.
If you visualize 100 bars you draw some lines, if you show 500 you draw other lines.
The point is that what we have on the chart is 99%+ random with a significance close to 0.
Have you ever seen a hedge fund boss charting? ;)
True enough! Do not doubt it for a moment.
But, I posit, market sessions are true/real irrespective of time-frame or special indicator settings, thus reveal some inner structure. (am exploring trades at daily/weekly extremes as points of interest.)

Hope you have a great weekend. Looks really sunny here.
 
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mpups

Experienced member
1,024 141
It is the mystery of charting.
If you visualize 100 bars you draw some lines, if you show 500 you draw other lines.
The point is that what we have on the chart is 99%+ random with a significance close to 0.
Have you ever seen a hedge fund boss charting? ;)
Hi there,
What's that chart via your signature link btw?
It shows an equity curve which made -0.63% in over 5yrs?
 

CavaliereVerde

Experienced member
1,398 1,801
It is the only chart that really matters: a trackrecord! ;)

It is not very attractive right?
Do you have something better?
 
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CavaliereVerde

Experienced member
1,398 1,801
Than we have another cathegory.
Those that use TA and charts on equities.

They trade long only, they make money and they think to have a right setup or right stops.
The reality is that their profits are due to the bullish market.
If your setup is profitable it should work on neutral markets like currencies and commodities and with a neutral strategy.
 
 
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