What is the best way to cut reduce short term whipsaw trades?

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Jan 14, 2011
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#1
In a development strategy, trades <= 5 bars most often lose while > 5 bars the majority make money. If I widen the stops for 5 bars after every trade this removes the shorter trades but they become losing 6 bar trades as the trades just get delayed until after the stop widening ceases on the 6th bar. What is the best way to reduce short whipsaw trades like this without just shifting the losses elsewhere? Even a 5% reduction in whipsaws would lead to a big improvement
 
Mar 20, 2017
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#2
5 minute bar isn't the same as 30 minute, 1h or daily bar just by looking at candle charts, so I don't know which type of chart is mentioned in the post. But if you want to make money consistently, the best way is definitely not trading at such a fast pace, i.e. using 5-6 bars, this will only make you lose more in the long run.
Patience won't hurt you, and it's the mother of W Baffett's huge success in the stock market.
 

tomorton

Well-known member
Feb 28, 2002
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#3
Markets don't move in regular patterns of a certain number of bars or a certain number of pips/points or a certain number of days/minutes. These are artificial constructs traders try to impose on chaotic data to make rational sense out of it but it ultimately cannot work to your benefit.

Take the behaviour the market exhibits and adapt your strategy to it. after all, it cannot be rational to take a strategy and expect the market to conform to your rules.
 
Apr 9, 2017
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#4
In a development strategy, trades <= 5 bars most often lose while > 5 bars the majority make money. If I widen the stops for 5 bars after every trade this removes the shorter trades but they become losing 6 bar trades as the trades just get delayed until after the stop widening ceases on the 6th bar. What is the best way to reduce short whipsaw trades like this without just shifting the losses elsewhere? Even a 5% reduction in whipsaws would lead to a big improvement


I've got something that works well for that.