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Scaling-in/Adding near your average MAE; why not?
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Scaling-in/Adding near your average MAE; why not?

  #21 (permalink)
CL Assassin
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Everyone,

So, I wanted to give a video example or something else to help show my idea in a different way. I got an opportunity on a live/cash trade just now, and took a stab at editing with Camtasia for the first time.

In this video, you will see exactly the example I have given in this thread at work. I enter a trade based on my signal, add at 8 behind entry, with the same stop as the original entry, and then exit from there. (incorrectly) You will also see me pull my original target(s) as I found myself focusing on the video too much. For the record, the original targets were good.

Again, I want to say that this idea is based on my statistics and experience with CL and to me seems like good money management.

Check it out and let me know what you think:
Video Here

Gary

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  #22 (permalink)
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Gary View Post
Everyone,

So, I wanted to give a video example or something else to help show my idea in a different way. I got an opportunity on a live/cash trade just now, and took a stab at editing with Camtasia for the first time.

In this video, you will see exactly the example I have given in this thread at work. I enter a trade based on my signal, add at 8 behind entry, with the same stop as the original entry, and then exit from there. (incorrectly) You will also see me pull my original target(s) as I found myself focusing on the video too much. For the record, the original targets were good.

Again, I want to say that this idea is based on my statistics and experience with CL and to me seems like good money management.

Check it out and let me know what you think:
Video Here

Gary

Good trade, I had the exact same signal fire with a target of 20 ticks. I was done for the day but saw this happen.....I started wondering why you took off the trade with no exit signal in sight but I suppose trying to make a video on live money would be a bit unsettling. Otherwise, I really like the concept.

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  #23 (permalink)
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aztrader9 View Post
Good trade, I had the exact same signal fire with a target of 20 ticks. I was done for the day but saw this happen.....I started wondering why you took off the trade with no exit signal in sight but I suppose trying to make a video on live money would be a bit unsettling. Otherwise, I really like the concept.

And, another great example:

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  #24 (permalink)
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Gary View Post
And, another great example:

Attachment 20604

Now I really have a question....I seem to remember your entry rules called for an entry on the close of the first bar NOT touching the moving average. The trade highlighted in the attachment is a good trade but the entry does not conform to what I seem to remember as your entry rule.

For me, if you have a really good sense of the market, this can be somewhat discretionary, but I'm wondering about this......I took a trade today under similar circumstances. The bar was still touching the MA but I had confirmation everywhere else......your thoughts?

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  #25 (permalink)
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aztrader9 View Post
Now I really have a question....I seem to remember your entry rules called for an entry on the close of the first bar NOT touching the moving average. The trade highlighted in the attachment is a good trade but the entry does not conform to what I seem to remember as your entry rule.

For me, if you have a really good sense of the market, this can be somewhat discretionary, but I'm wondering about this......I took a trade today under similar circumstances. The bar was still touching the MA but I had confirmation everywhere else......your thoughts?

AZ,

There are many times I will take trades in which the bar is touching the MA, depending on how much of the bar is above the line, and of course prior price action. I have found I cannot be 100% mechanical on the entries or the exits, and thus cannot have a hard/fast rule for every entry and exit. This would have been one of those times. I did not take this trade as I was already done for the day. It was just something I watched happen and made note of.

I believe I work best when I have a base line of rules, but will still require some discretion on entries and exits, and maybe over time can make small changes to the base rules to help have a written record of how I trade. I am not sure I could ever have rules to cover 100% of the trades I take and why I would enter or exit. Balance.

You agree?

Gary

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  #26 (permalink)
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A lot of opinions here, but I think the numbers don't lie and if they say it is ok to do something over time, then you can do it. It doesn't mean you have to do it every time, but if you are picking your entries and you have consistent statistics, then I don't think you will be able to magically improve your stats in the middle of a trade. Think about it, if the price starts out by pulling back into your position by some measure then that is going to tell you that the trade is somehow now a better trade then it was before? So if the math doesn't support it and you know over time it's a loser, then why would you ever do it? Maybe it's a universally good idea and would work for everyone, I don't know, I just think it would be prudent for everyone to do their own math and not just wing it.

What I do know is that Gary is AWESOME!!! You use the macd too, right?

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Gary View Post
AZ,

There are many times I will take trades in which the bar is touching the MA, depending on how much of the bar is above the line, and of course prior price action. I have found I cannot be 100% mechanical on the entries or the exits, and thus cannot have a hard/fast rule for every entry and exit. This would have been one of those times. I did not take this trade as I was already done for the day. It was just something I watched happen and made note of.

I believe I work best when I have a base line of rules, but will still require some discretion on entries and exits, and maybe over time can make small changes to the base rules to help have a written record of how I trade. I am not sure I could ever have rules to cover 100% of the trades I take and why I would enter or exit. Balance.

You agree?

Gary

My trading buddy and I were having this very same conversation today about our method. The rule was/is, the bar must close totally away from the MA. But I took a trade today that looks like the one we are discussing. So my position is if price action says its ok, the other charts are in confirmation, then that is the low risk trade. For me, as long as the bar closes above it, that is where i want the entry. The risk is the smallest there, the reward is the greatest and so why not. Other times though, I want some extra reassurance, so I wait. So far so good....I will say this, normally I would see this type of entry on a trend continuation after a pull back....I don't think I would take this at the beginning of a move.

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  #28 (permalink)
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Gary View Post
Everyone,

So, I wanted to give a video example or something else to help show my idea in a different way. I got an opportunity on a live/cash trade just now, and took a stab at editing with Camtasia for the first time.

In this video, you will see exactly the example I have given in this thread at work. I enter a trade based on my signal, add at 8 behind entry, with the same stop as the original entry, and then exit from there. (incorrectly) You will also see me pull my original target(s) as I found myself focusing on the video too much. For the record, the original targets were good.

Again, I want to say that this idea is based on my statistics and experience with CL and to me seems like good money management.

Check it out and let me know what you think:
Video Here

Gary

Gary, thanks for sharing the video.

I am going to have to ask you to step away from the mouse, nice and slowly, and no one will get hurt! The video is 4 minutes long, I think it moved a total of two 6 range bars the entire video, yet you moved your targets probably ten times! lol, yes too much focus on trying to impress the forum with your mad trading skillz There was no audio, right? I'd like to hear what you were saying when you were moving the targets.

Still it was unusual price action for CL, it was having some issues at that .00 level it seems, normally we fly around pretty good at those levels after they've already traded there for the day.

Mike

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  #29 (permalink)
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Gary View Post
Hey all,

Riddle me this....

Let's say my statistics tell me that on my winning trades I have an average MAE of 8 ticks. For this example, let's assume that I am using a 12 tick initial stop.

Why would I not want to add to my position if/when price is trading against my initial entry around the 8-12 tick area with a smaller stop?

Example:

I enter using a buy stop market order on CL @ 75.11, my initial stop is $74.99. Shortly after entry, price is trading around $75.03. Why not add more here with a 4 tick stop? Statistics tell me that this is as far against me as it will go, on average. I add to my position with relatively little more risk, but the upside is potentially much larger.

If you think your initial stop is no good any longer, then why are you still in the trade? Why wait for it to hit your stop? Your stop should be placed in such a way that you know you are wrong if your stop is hit.

On the other hand, if you know your stop is good based on your experience and statistics, why not add more with a small stop (still honoring your initial stop) thus allowing a slight bit more risk, but maximizing your upside much more?

2ND part to my riddle:

Best way to handle this logistically with Ninja?

I currently do the following:

Enter trade with buy stop market order with "ATM Strategy 1", change to "ATM Strategy 2" (add with 4 tick stop) and place a limit order 8 ticks from initial entry, and then manage the exits as I normally would; possibly even look to pull off some of the trade near my original entry. Exits will and should be based on statistics and price action at the time the order is placed.

Ideally, price trades against me enough to fill my additional order, and then moves on like I expected it to move in the first place.

Something to think about......

Thoughts / comments / suggestions?

Thanks,
Gary


I don't have a lot of experience with this approach, but I have done this on occasion ONLY when charts indicated that I had the direction correct, but that I'd perhaps entered 'one swing too early', which meant price came against me a bit more than if I had entered on the correct swing.

I have no firm data on how well this works as an ongoing strategy.....but in general it makes me a bit nervous. Of course a more experienced trader can make lots of things work that I can't.

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  #30 (permalink)
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max-td View Post
for shure you can also try to speculate always for a better price then your initial trigger is.
you dont enter at the trigger but you try to enter some ticks better with a limitorder after the setup is triggered.
this gives you a risk of a run-away-priceaction where you dont get a fill.

Cool thread. I am with Max on Riddle 1. If going long, this second entry becomes a C entry on ABC, 123, or second trend line break in a pullback per Brooks (H2), or the second attempt to bust thru a mini resistance point on a pullback taking out bear stops trying to short scalp back to the MA. Second attempt at a failed breakout... etc. I haven't studied Ross hooks that much but I think the premise is to enter here all the time with smaller stops.

It seems to me that entry 1 should never occur anymore, now that you know your MAE is 8. You should enter with both contacts after the MA cross and when price pulls back 8 ticks (your MAE). However, this is theoretical. In real life, you might begin to second guess your entry and over analyzing...(ie., this is where I would have entered long, now I need to make sure that I enter with a buy stop eight ticks below that.) As Max said though the risk is that price could run away from you (but then I wonder if it is a good entry at all).

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