<<a few words about adjusting the stop loss. You got lucky and created position at the beginning of the move...Are you moving your mental stop loss constantly with price? >>
Hi Michael...interesting question.....from my experience, you have to determine a target before you enter a trade...actually, you need to create a PLAN before you enter the trade.This will hopefully get you relying on your intuition and sensitivity, vs. Luck. How's the saying go...Luck favors the well prepared? Oldtimers say, plan a trade, then trade your plan. This might be a quick strategy when you see an opportunity, or one you develop as you watch a stock and wait for the play to meet your requirements. It is always developed around past performance, and what you might believe to be PROBABLE <vs. possible> future performance . What i take into account is current Market sentiment, current stock sentiment, quality of news and how recent it is, the stocks current trend in a daily, hourly and 10 minute framework, and it's recent high's and lows. If your plan includes an entry and an exit price, as well as a strategy that covers what you will do based on movement either way, you are in a much better head set patience-wise to make an accurate play. So then you have to figure when enuf is enuf when your up. I like to use half and whole numbers as either hesitation points or turning points, as i trade for halves and points...scalping 1/8's is not the game for me-too much work ;-) WSTL was up 2.13 points Friday on earnings on a little over 3X normal volume (stock sentiment); opened up an eighth today @ 14.63 in a neg/neutral market, quickly dropped a point to what i thought was a bottom; i went long at 13.63 looking for either a point, or a whole number (15)..i got both. If my plan was really together, i woulda reversed my position and ridden it back down to 14 ;-) But if you're having trouble creating a target price to sell at, you might use a trailing stop similar to your stop-loss: 1-2% of your account equity. Just keep moving it up. Another strategy i've been working with recently is using MACD and MACD histogram/oscillator to time my entries and exits; they can give you an amazingly accurate short <and long> term picture of current sentiment. Hope this helps ;-)
-Coyoti |
