NexusFi: Find Your Edge


Home Menu

 





Overnight trading and Stops becoming irrelevant ?


Discussion in Traders Hideout

Updated
      Top Posters
    1. looks_one DbPhoenix with 2 posts (3 thanks)
    2. looks_two mdsvtr with 2 posts (0 thanks)
    3. looks_3 Quick Summary with 1 posts (0 thanks)
    4. looks_4 Johno1 with 1 posts (0 thanks)
    1. trending_up 3,610 views
    2. thumb_up 4 thanks given
    3. group 3 followers
    1. forum 6 posts
    2. attach_file 0 attachments




 
Search this Thread

Overnight trading and Stops becoming irrelevant ?

  #1 (permalink)
 mdsvtr 
Memphis,TN
 
Posts: 232 since Sep 2010

My question stems from me wanting to start trading and holding trades through the overnight hours,
but I am a bit hesitant ... giving the stories I haave heard, of some traders not sleeping well and having restless nights, due to placing and holding trades through these overnight hours.

So even if you place a stop loss on a trade, that stop loss can become irrelevant and have the market blow straight threw it , and you incur a far greater loss ?

Is there a way to prevent this from happening /

And what causes these wild swings / gaps in the over night hours ...... news that comes out of Asia and Europe I am guessing ?

Thanks - Michael

Reply With Quote

Can you help answer these questions
from other members on NexusFi?
NexusFi Journal Challenge - April 2024
Feedback and Announcements
Request for MACD with option to use different MAs for fa …
NinjaTrader
My NT8 Volume Profile Split by Asian/Euro/Open
NinjaTrader
ZombieSqueeze
Platforms and Indicators
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Retail Trading As An Industry
58 thanks
Battlestations: Show us your trading desks!
49 thanks
NexusFi site changelog and issues/problem reporting
47 thanks
GFIs1 1 DAX trade per day journal
32 thanks
What percentage per day is possible? [Poll]
31 thanks

  #3 (permalink)
 DbPhoenix 
Phoenix AZ
 
Posts: 470 since Dec 2012



mdsvtr View Post
My question stems from me wanting to start trading and holding trades through the overnight hours,
but I am a bit hesitant ... giving the stories I haave heard, of some traders not sleeping well and having restless nights, due to placing and holding trades through these overnight hours.

So even if you place a stop loss on a trade, that stop loss can become irrelevant and have the market blow straight threw it , and you incur a far greater loss ?

Is there a way to prevent this from happening /

And what causes these wild swings / gaps in the over night hours ...... news that comes out of Asia and Europe I am guessing ?

Thanks - Michael

There's really no way of preventing it from happening, unless you use a stop limit, but then your stop would be unlikely to be triggered at all.

One can avoid the situation, however, which is a backdoor means of "preventing it from happening", by trading a larger bar interval, thus making the scenario you've presented irrelevant. If, for example, you trade an hourly bar and enter correctly, whatever Europe does at 3 or 4 in the morning is unimportant. The fact that we're currently ranging means more hovering on your part for now, but when we're trending, trading the hourly bar makes for much more relaxing trading. You lose the video-game excitement of daytrading, but perhaps that's begun to wear off.

Reply With Quote
  #4 (permalink)
 mdsvtr 
Memphis,TN
 
Posts: 232 since Sep 2010

Hi DbPhoenix ,
Thank you for your reply

This is just something that I want to know as much as I can about, before I start looking to enter trades after 5:00 p.m. cst. ( so overnight trading and or to avoid the overnight Margins )

I look at a Daily, 2 , 3 ,4 day chart, as well as a weekly and monthly chart ( when is relevant to ..... the close of every Friday I look at the weekly charts and the last trading day of every month I look at the Monthly charts )

So sometimes, I can get an Entry based off of a weekly chart , which definitely calls for wider and costly stops ( if placed based on the structure of the charts, I.E. stop goes below a major support / above a major resistance level )
And with these triggers for Entry ..... something major would have to happen , something in the realm of a mood outside a Futures ADR of 2 - 3 x it

Just don't want to be I a trade ( on the wrong side of it ) when I'm asleep, and a Black Swan even occurs , like it did on the Swiss Franc, back when the Swiss Bank crisis hit months ago

Thanks much - Michael

Reply With Quote
  #5 (permalink)
Pedro40
Pittsburgh, Pennsylvania
 
Posts: 564 since Jan 2013
Thanks Given: 33
Thanks Received: 379

Just 1 hour after you posted, futures opened deeply down, ES -30 points, jumping over a bunch of stop losses, due to the Greek situation. So yes, anything can happen...

Reply With Quote
The following user says Thank You to Pedro40 for this post:
  #6 (permalink)
 DbPhoenix 
Phoenix AZ
 
Posts: 470 since Dec 2012


mdsvtr View Post
Hi DbPhoenix ,
Thank you for your reply

This is just something that I want to know as much as I can about, before I start looking to enter trades after 5:00 p.m. cst. ( so overnight trading and or to avoid the overnight Margins )

I look at a Daily, 2 , 3 ,4 day chart, as well as a weekly and monthly chart ( when is relevant to ..... the close of every Friday I look at the weekly charts and the last trading day of every month I look at the Monthly charts )

So sometimes, I can get an Entry based off of a weekly chart , which definitely calls for wider and costly stops ( if placed based on the structure of the charts, I.E. stop goes below a major support / above a major resistance level )
And with these triggers for Entry ..... something major would have to happen , something in the realm of a mood outside a Futures ADR of 2 - 3 x it

Just don't want to be I a trade ( on the wrong side of it ) when I'm asleep, and a Black Swan even occurs , like it did on the Swiss Franc, back when the Swiss Bank crisis hit months ago

Thanks much - Michael

Asking questions may not yield as much useful information as characterizing whatever instruments you want to hold overnight. I have no problem holding the NQ, and I imagine that ES traders have no problem holding the ES. However, some instruments are frantic, even overnight, and the upside may not balance off the potential downside.

Entering off a weekly chart does not necessarily mean entering off a weekly bar. The point of entering off a weekly or daily chart is to enter off the extreme. Once that extreme has been established, one can enter off whatever bar interval one chooses with an accompanying tighter stop. If and when the entry works, one can then back away and manage it on a larger interval, perhaps hourly.

Currently, the extreme in the NQ is the daily high (4555+/-). I'm not tempted to hold anything overnight that isn't entered one side or the other of that high.

Reply With Quote
  #7 (permalink)
Johno1
Geelong Victoria
 
Posts: 113 since Jan 2015
Thanks Given: 45
Thanks Received: 92


Pedro40 View Post
Just 1 hour after you posted, futures opened deeply down, ES -30 points, jumping over a bunch of stop losses, due to the Greek situation. So yes, anything can happen...

If you haven't worked it out by now, consider spreading your positions. I trade around the clock and yes I sleep well, I doubt that I would if I was taking naked positions O/N.

Cheers John

Reply With Quote





Last Updated on July 20, 2017


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts