I always have exit orders. Have found that if I sit there staring at my charts when I am in the money, I am more likely to take myself out due to fear of loss when market noise comes in, and then miss the continuation of the move. So now I get in, set my exit orders, and go do something else.
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I agree but I'm also concerned that if I have stop-limit behind my position and an OCO exit order ahead of my position, then there is a good chance that the market will reverse or retrace before hitting my exit. That would mean, assuming I'm away from my screen, that I would finish with a scratch trade (+slippage). Does this possibility not bother you?
My ideal exit order would be like a price-triggered action that replaces my manually created stop limit with a dynamic trailing stop. I feel that dynamic trailing stops are rubbish when building a position, but great at taking the emotion out of exits. Unfortunately, I don't see a way to automate their creation.
How do you set your exit orders (and which system are you using)?
Also.. if it were possible to guess the perfect exit price then a cut-and-reverse would be optimal, and I don't think anyone has suggested that should be automated.
Last edited by London Trader; August 8th, 2015 at 08:11 PM.
For positions that are supposed to take a moderate time, I usually surf the net (blogs, forums, youtube), read books and so on, but rarely ever leave the desk, as I do keep an eye on prices from time to time. If a pattern that I don't like shows up before the profit target is hit, I may decide to close the position. Still have a lot to improve with this kind of decision making, though.
Sometimes I also do some "fire and forget" trades, where it's either stop or profit. Mostly when I have to leave the desk for more than a few minutes for whatever reason.
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No, it really doesn't bother me. If I don't catch the larger underlying move, then the loss is just a part of my system. I tried trailing stops recently, and it tended to shut me out of greater overall profits than leaving the stop or moving it discretionary.
On a good trade, I try to place a stop over the top of the range, where only a violent false breakout could take me out before the market continues in my direction. I just use OCO orders in NinjaTrader. The ATM strategy helps me do it a little bit faster but it's nothing special. If I'm not getting in where my odds of taking my maximum loss per trade are low (ie placing the stop where I expect the market won't go means a large potential loss), and/or my profitable exit would not leave me profiting more than I am willing to lose, I generally don't take the trade to start with. It's what I like to think of as a mechanical discretionary system. All parameters and orders are laid out at entry, but they are not the same every time, allowing for the randomness of the market.
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Oh how much I miss my XBOX. I already have to act "extra busy" so that my wife is convinced I am actually working lol. This is at the top of the list once my profitability improves, and I can prove to her the time vs. reward makes sense in her mind
I have an alarm set so that I check the market at the close of each 5 min bar for my trading hours, so I try to have a book that I am reading when emails are done, along with any other important items on my to do list for the day.
I try to stay updated on news and markets, so daily I check the following sites:
I have a defined area I want to trade which I mark before I start trading for the day, so I set a price alert at that level then go and live my life - this means I spend the majority of my time not looking at the screen. This can be anything from watching TV to playing a game or whatever. I glance at my screen once every 15 mins to see what's happening out of curiosity.
I find if I sit there and watch the price I'll either fall asleep or I think every tick is a setup and I should trade it - both very bad situations I don't want to be in. Additionally, by having a very clear area to trade and walking away until the setup happens, I stop myself from deviating from the plan.
Specifics? I play heroes of the storm, watch stargate, anything on hulu, play risk and when battlefront comes out - I'm all over it.
@Itchymoku try heroes of the storm!
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