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

To: Chip McVickar who wrote (18373)	3/11/1999 7:20:00 PM
From: Patrick Slevin	Respond to of 44573

Well, those indicators that you mention would provide an Entry/Exit Signal. Me, I need the pattern first. If I had an 80% probability that the SPX would see it's daily high in the first hour then I would work the indicators to get me an Entry. Odds are, if I had a half a brain, I would guess that a good Sell in the first hour will make me money. Whether it's 4 points, 10 or a hundred and ten if I was 80% certain that the first hour is the High of the Day then I have to sell it. It's a rational play. Now, there is a 20% chance I'm wrong and so I have a stop to cover that problem. If, by chance, I hit the high and the market drops perhaps 5 points then I could place the Stop at breakeven and wait......if it drops 5 more then I could lock in a profit with a 6 point Stop and wait....and so on. If I think there is a high probability of the Low hitting at 2:30 then I could tighten the stop to 3 or even 2 points and Lock it in perhaps around 2:15 or whatever. All it is, is controlled gambling. If it's a High Percentage Sell then I Sell it with a close Stop and allow the Stop to widen until I think the risk of a Long is present and then I either cover or get the Stop so tight that only a complete failure would keep me in the game. It's just poker. The key for me, is not to trade against the pattern. If the pattern is incorrect then I'll lose a little. If the pattern is correct then I will make up for the losses when it is wrong.