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This seems to be the conclusion you have reached several times.
Yet you don't seem capable of doing that.
Forget the mental stop.
Hard stop is the answer.
No execptions!!!
And your signature is right. This is painful. Even for the followers of your journal.
"The days when I keep my gratitude higher than my expectations, I have really good days" RW Hubbard
Not to continue to thump on you, but, FYI, I have never in my life honored a "mental stop." I just have waited to see if it was really going to be hit, and of course ignored it when it was. -- For the same reason that people move their stop away from price as price goes against them: not wanting to accept the reality of being wrong and losing money.
I started doing much better when I put in real stops (there's no sense calling them by any other name), and just saying, "Well, OK" when they got hit. Which they will, often enough.
Avoiding loss by not taking it when it's there is the best way imaginable to ensure having even larger losses.
Sorry to beat on this drum, but all the indecision and back and forth about stops is not doing you any good at all.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
Yeah I want to do the right thing but I like gambling and cheering for my losing trades. Another thing is it hurts to take a loss and I don't like using stops because it feels so final when a stop is executed.
Trading is definitely not easy. I find that when I think I'm right I hold a loss the longest. My biggest losses are happening when I really believe in a trade and dig in and hold on.
Mental stops are only an excuse for your mind to avoid the pain of losing, because your thoughts about stops are negative (pain). Try to change them for a more positive way:
Way to learn
New oportunity
More time in the game
A stop is not the end of the world
Big Money, has always reason, doesn't matter if they lose or win...
Absolutely. A stop is your friend. (It's mine, anyway. )
Try not cheering for your losing trades. Try cheering for your winning ones. And a stop is final. That's what it's for: to get you out with some money left when you're wrong. That's a good thing, because you are going to be wrong sometimes, and you have to know what to do when you are.
Naturally. Holding on and digging in does not make a trade better. It just clouds your judgment and makes you think that holding a losing trade is a good idea and will work out. So you don't just bail out and live to fight another day, you lose more.
I'm really sorry to be sounding like I think I know more.... well, in some of these things I really do, but only because I've done all of them too, or others that are no better, and more -- and then changed after figuring out they don't work. All your responses and impulses are natural, but they are going to lose you money because they are not how the game is played.
Maybe take just one small step, like setting a real stop and not being scared of it, and not being upset if it's hit. One thing at a time, until you can change.
Good luck.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
Well I think I am very sure that I am going to trade with a stop. Crazy things happen in the market, like the day oil went negative during covid lockdown. I know if I was trading that day I would have gone long just waiting for a rip your face off kind of rally but the result would have been my broker liquidating my position and me sitting there with a few dollars left in my account.
Now that I have decided to always use a stop the next thing with me will be in the opposite direction, using a 1 or 2 tick stop. I have an obsessive personality and I am already planning my next trading session where I will utilize a crazy tight stop, and I won't give my trades room to breathe and just get stopped out on like 100 trades in a row. Unfortunately there is no middle ground for me and I must exhaust the idea of using an extremely tight 1 tick stop now.
@blackgrey45 I don't think you should use 1 tick stop. You have your trade data, use it. From the data, you can determine a reasonable S/L, which will give both your trade and yourself that "room" before you can fully accept the loss.
I suspect you might face the issue very soon where if you keep getting stopped out, you will regress back to mental stop loss. Those trades that run away will trigger you, and you will revert back.
For me, the struggle was, accepting the loss. I had no problem setting a hard stop loss...I had a problem of moving it. I always moved it from my initial S/L. I found out recently through my data , 20-24 tick was the my average exit. I had held a few, some down all the way to -70-90 ticks, but the chances of it rebounding/recovering were a lot lower compared to -13tick trade. The data showed all the proof I need. I haven't kicked the habit 100%, but I've haven't touched my S/L for a good 1 1/2-2 weeks.
You should give it a try.
For MES, my ATM strategy : -24 tick stop loss/ 20 tick take profit. on +12 tick move stop loss to +6 tick above b/e. My next goal is figure out how I can consistently cut my trade before it gets to -24ticks.
A stop that is so close to your entry that it is likely to be hit just in the normal fluctuations of the market is not going to do you any good, so one or two ticks is going to be too close. That doesn't allow for any leeway at all in the trade. That would require close to 100% accuracy in your trade placement, which you are not going to have.
Ideally, you would place your stop where you "know" (or think you know) that the trade is not working out. You don't want to have a stop just for the sake of having one, you want it to protect you when your loss reaches a pre-determined level that you have decided you don't want to continue with. (Pre-determined because you can't usually rely on your own snap judgment while the trade is in motion -- we tend to try to justify the decision to be in the trade, or to avoid the emotional pain of accepting the loss, and these impulses work against us.)
The place for the stop could be based on things like recent average price fluctuations, or on something like support or resistance, or on anything else that lets the trade have a bit of adverse movement, but that cuts it off when it has become whatever you have decided is "too much." It is not wrong to have your stop based on something like your present judgment of what the market is doing either (trending, ranging, or whatever you think applies). It is just important that the stop be decided on ahead of time, and that it always be honored if it if hit.
You could also trail a stop, moving it in the direction that price is moving, if it is in a trend for instance, so you can make sure you get some of price movement that has gone in your favor. You just can't move it back to avoid it being hit if you're wrong. That short-circuits the whole idea of having stop protection.
If you're not sure what to use, just set it to something that is close to or a little greater than the recent price fluctuations, so you're not stopped unnecessarily.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
Hi, I appreciate all of the support from you all. However, I entered a trade today and had no exit plan. I entered long at 4476.25 and watched the trade move against me until my broker closed the position at 4451.75 for a -$122.50 loss.
