How can you let your winners run ?

[Grey1]

How can you let your winners run ?

Every one tells you exit is the most important part of trading .. let your profit run ..

I tell to this people you are spot on I agree but gimme that crystal ball then i will let it run ..

SO what is the crystal ball of trading ?

What are the techniques ?


I invite traders to contribute

grey1

 

[ianp]

How can you let your winners run ?

Every one tells you exit is the most important part of trading .. let your profit run ..

I tell to this people you are spot on I agree but gimme that crystal ball then i will let it run ..

SO what is the crystal ball of trading ?

What are the techniques ?


I invite traders to contribute

grey1

As we don't have crystal balls, I guess the best time to exit would be when the move shows exhaustion , I am guessing we could use Macci to tell us when the trend is over ?

Ian

 

[leovirgo]

I have very little knowledge of trading individual stocks. However, my little experience of trading $DJI for 10 months tell me the following:

1. A trend starts in Lower Timeframe (LT). A winning trade may be prematurely exited once there is an exhaustion in this timeframe. But this lower level TF trend exhaustion sometimes open the way for further moves in Higher Timeframes (HT) that's when a winning trade should be allowed to continue its future path until there is a rejection at an even higher level TF.

It does not matter what indicators are being used as long as higher timeframes analysis is kept in mind.

If I am following an UP trend in 5min, I will look for Long entry/ confirmation in higher timeframes ( 30min/ 1hr chart) & Short for the reverse. This multi TF progression analysis should be done until there is a FALSE signal is found. 5min > 1 hour > Daily > Weekly.

In short, LT is the sender and HT is the receiver. Sometimes, LT sends the prices to HT but HT rejection/failure will kill the trend. To think of the same thing from another angle, HT target/analysis are useless until there is a supporting move in LT which would realise the true potential in HT. If one can identify such connections, a winning trade can be run as much as it can. Top down approach is for potential, but bottom up approach for practical 'trade what you see'.

I will illustrate it with the example in DOW.

12th July
=======
5min chart : Short signal sent the prices to 11000 which in turn opened up SHORT signal in 1 hour chart.

From 12th to 17th, 1 hour chart showed RED bars for Short bias. Let the winner run ( or if the trade was exited at some point, keep shorting when LT short signals appear ).

On 17th, on DAILY chart, it showed a potential to reverse - oscillation signal found. Daily chart not shown here.

Having said what I've learnt from Mr Market, I am more than willing to learn from the wiser traders. Thanks,...

 

[moreagr]

based on my experience.. now looking back at my failures and losses i have been now watching the many indexs like dow s&p and futures if the stock or stocks are a heavy componet in the index... i monitor the slope of the trend through BBands and moving averages

when i first started trading i never looked at futures or the index which was a huge mistake IMHO now the last few months and especially the last month have i been watching them very closely.. i courage everyone to do the same. the spreads based on futures/cash is very important.. I discovered this 2 years late slow losses have caused me in a mad hunt to find the holy grail in trading. I think i am getting their slowly.

hope this helps

 

[LevII]

Extending what leovirgo says in relation to running a position by reference to exhaustion:

1. Scale out of the position as the trade exhausts in each time frame rather than close the whole position because of exhaustion in the shortest.

2. Close the position if the market is exhausted (by reference to the $INDU in the exhaustion engine).

3. Close the position if the exhaustion engine tells you to get out.

LII

 

[kako]

L

Every one tells you exit is the most important part of trading .. let your profit run ..

not true, even if every1 says so(i know u don't believe in it). as no1 has any crystal ball, then we have no control over our trading, except our entry point(and size). once u entered a trade, u have to watch it hit ur stop, or goes in your favour, and when to exit(RR) is always arguable(differs from trader to trader).
what we can do is: ENTER IN A SAFE PLACE, instrad of enter in chaos(note for the bramble : chaos = near vwap), and PRAY for the poor position to go in ur favour.

for the exit part, i agree with leo; using time frame slicing techniques, always result into "your position not depending to 1 TimeFrame" and dynamic position sizing, reduces the risk, hence it's a better exit, based on different timeframes, rather than 1.

Regards
......................................
Kako

Ps. Lev II, just saw ur message. that's true, but i have a question. what's the difference between 1 and 3? if highest TF says go out, we scale out all of the position, right?

 

[samtron]

I agree with time frame slicing, the only complication for me is that the trend could become exhausted in the lowest time frame (causing you to exit your largest allocated share size) only for it to be reborn, before the intial exhaustion has had chance to migrate to the higher time frame. :arrowu: :arrowd:

 

[leovirgo]

Here I am applying multi TF exhaustion for Dow. Short covering right at the bottom.

Thnx to Grey1..

http://www.trade2win.com/boards/showpost.php?p=266293&postcount=1846