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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: jjs_ynot who wrote (15651)	2/17/1999 8:23:00 AM
From: Tom Trader	Read Replies (1) \| Respond to of 44573

Dave re >>Do you find that the market in general comes back to allow you an entry on your buy/sell signals?<< There is no consistency in this regard; when one has a strong trending move, we'll probably not see the entry price again until I get a signal to reverse. At other times, we'll see prices retrace allowing a better entry price. I have been running some simulations to test an alternative approach and the results are promising; basically, I enter my initial entry the way that I have been doing and then add to the position, if and when prices retrace to a point where I can enter at a level that is approximately 1% better than the original entry -- provided that the signal to reverse is outside of the 1% range. For example, yesterday I went long at 1251+ and so today I might look to enter at 1238 or better -- assuming that my sell signal is somewhat below that 1238 level -- which in this instance would be the case. I would look to exit at a lower profit target on the add-on position than what I use with the original signal. I'd do the same with the bonds and the yen -- the specific entry level for the add-on being something that one would have to establish through simulations. If on the other hand prices do not retrace to the original entry level, I'd look to add on with a similar retracement from a higher level or when I receive a continuation signal. Not sure whether this is clear -- but as always money management must be paramount. Needless to say that during a period of severe draw-downs as I am going through right now on the spoo, add-ons during retracement could be problematical --but if the entry point is close to the reversal point it could still make sense.