No stops......just reverse

[cd173]

Morning Everybody!

Does anyone know if it is possible to trade the markets using just reverses instead of stops. This would mean that you are in the market a vast majority of the trading day/week/month. I've noticed that with a particular system I use, it may be possible to just 'ride the market' so to speak providing there are tangible peaks and troughs.
Sounds very stressful perhaps and no doubt plenty of discipline required, but is it possible??

Cheers
C

 

[TheBramble]

Why would you want to be in the market the whole time?

Is this a strategy? Just ride random price action? It's a weird one if it is. Effectively a random entry. Presumably you define somewhere what a reversal is (points, percent - whatever) for your exit (and therefore also your next entry)?

As for 'tangible' peaks and troughs - what's 'tangible'? And how would you know when you were at one?

I don't know about discipline - how long do you think you can hold on before you run out of money?

 

[trendie]

cd173,

depends on how you set your reverse points.
I used an "always in" S/R strategy on my journal to instil discipline.
for example, I used a 70 point S/R.

the problem occurs if your S/R point is "in phase" with the market, i.e., with a 70 point S/R, if the market range is 70 points, you are taking the S/R trade at the worst possible moment.
You will need some mechanism to try to get "out of phase".

I have also found, personally, that the need to be "always in" is a fear that I will miss out on a big move.

 

[FetteredChinos]

its what i do, tony...

but then again, that isnt a recommendation lol!!

as you lengthen the timescale, the absolute movement is a lot less. eg over a quarter, the price is relatively stable. over a year, +/- 30% or so..

prices tend to revert. i think it was Grey 1 who said that the markets are always range-bound in a particular timeframe. eg whilst we may be trending on the hourly chart, on the daily/weekly we might be oscillating.

assuming trading small enough size relative to account, mean reversion is a fairly safe method, when practiced on the longer timescales.

IMHO.

FC

 

[cd173]

Hi Bramble
Interesting points, but entry wouldn't be random. Once the first signal is given, it would be a case of following the trend/oscillation. I suppose it depends on which time frame you are looking at perhaps. Problems would no doubt arise from low volume/choppy days, which would be a disaster on the account!!!!!

Hi trendie
This idea (be it possible insanity) came about using a profitable system I've been trading, using a stop and target mechanism. Looking over a brief backtest with the same entry, but using next signal as reverse 'appears' to hold some water. Of course longer term testing would be needed and may very well turn out totally different in realtime.

I'm I insane????? :cheesy:

C

 

[trendie]

I'm I insane????? :cheesy:

Only your bank balance can tell you that !!

 

[cd173]

Hi FC

Good for you for being off the wall enough to do it
Any luck with it?
I was looking at a 5min chart just for starters............I would def not go any lower than that!!
For this sort of thing oscillations would be better maybe?

C

 

[Racer]

Reverse as in indices or shares?

I reverse on both but in longer swing trades, but wouldn't say go long when I had just been short. I usually wait for a while to assess to see if my exit had been correct.. you can never get the top or bottom, so often a good idea to sit back and look for a while.

 

[wasp]

I have tried it on spot cable with a 30 minute chart and its all good when its moving large amounts but on the choppy days it can be a nightmare.

Its certainy possible though...

 

[Old_Bob]

Who has the gut to trade without a stop loss?

 

[RUDEBOY]

To be never out of a particular market, lets say the Dow, i personally believe is the 'ultimate' in trading, (price action ONLY, and NEVER out). A scale is needed though, and fade would also be needed. Downtrend, uptrend and consolidation. Now, what about consolidating to the up, and, consolidating to the down? So, wonga, £/pt in any given situation, this is where a scale would be needed, low in consolidation and high in a trend? I think it can be done, 'aggresive holds', obviously a pussy, it would probably take a bit more of an account to do it this way, but it could be done?

 

[RUDEBOY]

Would there be stops? Mmm, at first maybe, but then they should be rid of!

 

[cd173]

[/QUOTE]i personally believe is the 'ultimate' in trading

Agreed rudeboy, but it'd be somewhat intensive to stare at a screen all morning!
Providing your first trade is correct and the market has enough range, you should be able to continue from there......but what time frame???
Stops would only be used for the first trade perhaps, with the next entry signalling the close of current trade.
Also you'd better only be in the market during the busiest times....and stay away during choppy days.......

C