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EURUSD Scapling

  #18 (permalink)

Springfield, Missouri
Trading Experience: Intermediate
Platform: NinjaTrader
Broker/Data: Interactive Brokers
Favorite Futures: EUR/USD
Posts: 28 since Sep 2012
Thanks: 29 given, 5 received

bnichols View Post
I've read books on money management (e.g., most of what Van Tharpe wrote)....makes my eyes roll back in my head....but by far the best source I've found for anything trading related, including money management, is (formerly BMT) mine of info for traders prepared to use pick and shovel. A search on "money management" should produce a wealth of info from many different perspectives, as in-depth as one can stand .

Regarding psychology, agree the need will vary with aptitude for trading. Unfortunately for me my personality (analytic, not as humble as I need to be, used to giving orders and having them carried out) means trading does not come naturally and my trading plan is heavily weighted toward working around persistent weaknesses (if you haven't already watched it, see e.g., Manesh Patel's latest webinar here)

I will check that webinar out. I agree that (formerly BMT) contains a wealth of information, and you have contributed much to it. Thank you, good sir.

Shar View Post
1. Losing $1200 on a losing trade is certainly a loser. When you've seen that, why haven't you cut back to at least 20 pips?

2. There is much free info out there on money management. Google plus google money management. Stoll down on the trading-naked Library and there are several articles about money management. This IS a business remember.

3. In the end, it's what one is comfortable with. Some, as myself, have a very close mental stop-out, and some using higher time frames use the last High or Low or a specific number of pips. I developed my stop loss (again mental) when I first started trading from a reading "Phantom of the Pits" who stressed getting out of a trade as soon as it's not going your way. This is a free pdf file which is also on trading-naked Library.

4. Some use the strategy of sending out a scout (one Lot) and if it's going your way then add more Lots.

It sounds like you have a great trading strategy, but your only problem is money management and apparently haven't used multi-time frame charts giving you more info. BTW, are you aware of Elliot Waves? If so then you know how one can be chopped in waves 2 and 4.

You mean cut back my stop to 20, right? Keeping the stop at 40 gives the trade more wiggle room and has helped keep me from getting stopped out on several occasions (in fact it kept me out of a stop out this morning). Now, cutting it back may indeed help make the strategy more profitable, but since I don't yet have the knowledge of EL to backtest the strategy I can't test that out.

Having a solid stop helps me, I think, because it takes almost all of the emotion out of the trade. I don't think I could have a mental stop loss... I would be a nervous wreck...

Would scout-lots work in such a short time frame? Seems like there's too much volatility in a 30m chart...?

You're correct, I don't use multiple time frames, but I'm seeing some definite benefits to using multi-time frame charts. I am not familiar with Elliot Waves at all actually. I will do some research on them. Do you have any recommended reading on the subject?

Thanks so much!

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