On this thread there are a great many ideas for all traders/investor types. Seems like a long time ago, I read the whole thread... Worth doing for those that have not.
Some use Elliott Wave constructions and Fibonnaci extensions to "forecast" likely areas of trend change or exhaustion; I haven't made my way to EWave yet myself, but many use it very effectively.
In a downtrend I use previous areas of support/resistance as my predefined exists. Trading intraday, I most often in a short have a buy stop a few ticks above the most likely support price is likely to visit - that's one way I exit a trade.
Another way I have taken to using is based on the concept of higher highs and higher lows defining an UP bar, the converse is true for down bars. Again, in a short, I will hold while the bars are DOWN bars (irrespective of the closing price/i.e. even a "white candle" can still be a down bar). William Dunnigan in a book over 50 years ago talked about this... in a very trendy market it works very well and allows me to capture more of the move rather than getting shaken out by seemingly sudden reversals. Higher highs, higher lows - and the reverse - very simple concept but few apply it to individual bars it would seem.
Another exit I use is the "dull market" exit. If I am in a trade, and things start moving sideways, I always exit. Always. When things move sideways indecision is at hand. While the move may continue in my direction, it may also suddenly reverse too. Especially if I am just in the trade and have no profit cushion, I will exit.
Virtually all of this is true on a 5 minute chart or even a weekly. Just depends on which time frame we enter, we should exit based on the same time frame, in my opinion...
Cheers
Michael |
