Rick,
I don't want to get caught in a shake if I can help it.
I think your approach is the right approach. Having said that I must admit to you, that I get caught in shakes fairly often during my trades. I do not purport this as a better way. Not at all.
It is just what I find happens sometimes. I often buy more at just about the exact time and price that I used to sell out.
Now I am over simplifying, and once in a while I get a good beating, but over all I have met with success by entering every trade twice.
I have been entering my trades two and three times and exiting once. I am interested in scaling out at the exit as well, but I have found it to be difficult to do. Usually when I want out, I really just want out and to be all cash.
Yup, I have paid out over 5k in commissions so far in '99. For me that is irrelevant, as my system is working fine and dandy.
Same thing with shorting, just when the old funk would cover at the top of the bounce, I just short more. Again I cannot emphasize how very wrong this could be. But it works for me.
If I am trading 1000 shares, I always go in 500 at a time with few exceptions. I also very often have multiple live orders on a stock. Such as offering out to short a bounce, while trying to work in just above the bid. Often I am very aggressive at getting into a short incase the stock breaks with out a bounce. Sometimes this aggressive move gets me in a little low. If I am in at a price that becomes uncomfortable due to a bounce, selling the top of the bounce gets my cost more in line with the trading range and makes it much easier to manage the trade to profitability.
What I am doing is very different than "averaging down" just for the sake of it. It is not that way at all. I only do this move when I have good reason to believe the stock is trading within a reasonable range at that moment.
I am struggling to describe the distinction.
Iguess the times I am comfortable averaging in is when all or almost indications point to me being right. I am always on the prowl for reasons to be wrong exit as soon as I see the indications. Unless of course, I am having a bad day. <ggggg>
funk |
