Momentum Daytrading - Tricks of the Trade Message Board

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Strategies & Market Trends : Momentum Daytrading - Tricks of the Trade

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To: Ken Wolff who wrote (619)	3/1/1998 4:07:00 PM
From: Coyoti	Read Replies (2) of 2120

Speaking of overtrading... I did my month-end assessment today...January was great...account up 30%, and my primary focus that month was on keeping my stops to an eighth or less...i only was hitting 4 out of 10...but do due my severe stop discipline, i made good money. This month ,however, i began experimenting w/looser stops to accomondate "market noise" and "Marketmaker Jiggle"...and now...I'm only up 15% for the year..<sheepish grin on a coyote face> Lookee: 88 Trades in Feb (i feel like i overtraded by 15%); 38 i got out flat to -1/4, 5 i got out -5/16 to -1/2, 12 trades out -9/16 to -1pt., and 4 trades out -1 to -1.25....the rest of the trades were 1/4 to 1+ point winners... So if i figure i took an 1/8 loss on the 16 worst trades, instead of the average of 7/8 or so, i would have 10+ more points retained in my account for February than i do now! That's a nice chunk of money..expensive lesson :-) ...Moral of the story: The hell with market noise; keep your stops to an eighth or less, with a willingness to re-enter the trade. The first small hit always turns out to be the easiest to swallow. Play the high percentage trades Ken speaks of, and the money will follow. Oh..and like Ken also suggests, keep the experimenting to paper ;-) Hope this helps someone -Coyoti

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