Rob E
07-17-2007, 03:00 PM
Hey All:
I’m looking for some help in clarifying what seems to work best on the shorter time frames (3 & 5 min.) for trade management based on (and coming from) the more experienced and successful MTP users out there.
I’m looking for what management guidelines are being employed to help prevent or reduce the types of situations that I’m going to be outlining below…but at the same time are not exposing one to unnecessary or greater risk exposure than would usually be deemed prudent.
Below is a situation that I ran into about a week ago and these situations (to me) are more painful than taking losses since losses are just part of the trading business.
On 7-10-07 we had a nice TS3 sell set-up on the 3 min. NQ pictured below. In that image I have included my notes on the chart itself explaining how things could have unfolded (and sadly in my case… did unfold) at certain points during that trade employing some of the more standard trade guidelines as I understand them following the MTP methodologies.
The reason that I mention in my notes on the chart about the length of time involved in the trade when the ATR would have been hit has to do with the concept of “Time Stops.” With this in mind, has anyone done any back testing to see what kind of time frames should it typically take for a trade to begin working in your favor and beyond that time frame, just to pull the plug because anything much beyond that time frame could result in a much higher probability of being stopped for the full 1R loss?
What trade management guidelines are the more experienced MTP users finding that seems to work best on the shorter times (day trades only) and seems to find that happy medium of keeping one in a trade long enough to give it the fairest amount of time to work out, but not exposing oneself to unnecessary risk exposure? At what points in a day trade are you finding works best to begin bumping up your stops to B/E and so on, similar to the longer time frame setups and guidelines which recommend bumping up stops once the trade has exceeded the 100% risk area?
With this thought process in mind, I’ll bring this particular post to a close with my own favorite quote: “There’s nothing more liberating in a trade than reaching that risk free zone!”
The opposite side of that coin would be: “There’s nothing that eliminates the joys of that liberation faster or more frustrating than what’s posted below!”
Please share what techniques are successfully being used to find the happy medium between these 2 emotional extremes. Thanks much for the input and helping us all learn together!!!
I’m looking for some help in clarifying what seems to work best on the shorter time frames (3 & 5 min.) for trade management based on (and coming from) the more experienced and successful MTP users out there.
I’m looking for what management guidelines are being employed to help prevent or reduce the types of situations that I’m going to be outlining below…but at the same time are not exposing one to unnecessary or greater risk exposure than would usually be deemed prudent.
Below is a situation that I ran into about a week ago and these situations (to me) are more painful than taking losses since losses are just part of the trading business.
On 7-10-07 we had a nice TS3 sell set-up on the 3 min. NQ pictured below. In that image I have included my notes on the chart itself explaining how things could have unfolded (and sadly in my case… did unfold) at certain points during that trade employing some of the more standard trade guidelines as I understand them following the MTP methodologies.
The reason that I mention in my notes on the chart about the length of time involved in the trade when the ATR would have been hit has to do with the concept of “Time Stops.” With this in mind, has anyone done any back testing to see what kind of time frames should it typically take for a trade to begin working in your favor and beyond that time frame, just to pull the plug because anything much beyond that time frame could result in a much higher probability of being stopped for the full 1R loss?
What trade management guidelines are the more experienced MTP users finding that seems to work best on the shorter times (day trades only) and seems to find that happy medium of keeping one in a trade long enough to give it the fairest amount of time to work out, but not exposing oneself to unnecessary risk exposure? At what points in a day trade are you finding works best to begin bumping up your stops to B/E and so on, similar to the longer time frame setups and guidelines which recommend bumping up stops once the trade has exceeded the 100% risk area?
With this thought process in mind, I’ll bring this particular post to a close with my own favorite quote: “There’s nothing more liberating in a trade than reaching that risk free zone!”
The opposite side of that coin would be: “There’s nothing that eliminates the joys of that liberation faster or more frustrating than what’s posted below!”
Please share what techniques are successfully being used to find the happy medium between these 2 emotional extremes. Thanks much for the input and helping us all learn together!!!