fixed stop loss vs. a trailing stop

[reactor]

hi fellow traders!

im trading the ftse 100 futures and i'm thinking about stop losses and trailing stops.

i haven't yet used these as part of my strategy but from tomorrow i will be using a 2 point trailing stop because i was hit big time a few days ago.

i'd like some ideas on how i could use either in my overall intra-day strategy.

thanks for your time people and i hope your trading goes well this week!

 

[Car Key Boi]

hmm, a 2 point trailing stop on a index future is way too tight

yuo're gonna get stopped out time and time again....

 

[Skimbleshanks]

A 2pt stop is fine - as long as it is positioned at your point of entry AND there is previous support / resistance at that point as well. But there's no way I would use 2pts as a trailing stop during the trade - as khakiboy says, it's just too tight.

But then to be fair I don't know what your trading style is, so if you're scalping or going for the one pointers, then a trailing 2pts stop is ideal.

Sorry to hear you got singed, but it's great to see that you are still in the game, even if you've been slightly bruised.

 

[marky]

Hi reactor

I never look at the ftse but on the dow i open with a 10 point stop loss and soon as it moves my way i move the stop 2 points above entry so as to cover costs and at lease make a point as the market moves i constantly move the stop trailing the price by 10 points allowing enough room to breath abit but i think as skimble said it depends what your style is what time frame your looking at and how good your entry is and what your looking to take out the market it suites me as i use small time frames .Regards mark

 

[reactor]

thanks for the replies!

ideally i want to use a trailing stop so i don't have to exit myself. 2 points, after some thinking, does appear to be small. i'm going to widen it to 4 points.

 

[JonnyT]

2 points on FTSE and 10 points on the DOW are not tradeable.

The FTSE spread during a day often goes to 1.5 which means you only need a very small move against you to take you out.

The DOW often moves 10 points in a couple of seconds.

JonnyT

 

[Grey1]

stop loss should be a function of volitality .. look into volitality bands for more adoptive system than simply a fix number..
Alternatively look for ATR bands..

 

[marky]

Hi Jonny T

I think 10 points on the dow is ok if using ib and your entry is ok but it depends what sort of movement your looking for id put a chart on if i can figure out how.

Reagards mark