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Trading: Oh what a tangled web I weave, When I want to take profits in trading
Frequency: Several times daily
Duration: Years
Posts: 1,774 since Nov 2014
Thanks Given: 3,528
Thanks Received: 3,146
I was too early shorting Yesterday. Today it became too late. I was waiting for 2005 so that my stop will be safe at 21013 but we didn't get that far. That's OK. I will wait and miss this train.
Trading: Oh what a tangled web I weave, When I want to take profits in trading
Frequency: Several times daily
Duration: Years
Posts: 1,774 since Nov 2014
Thanks Given: 3,528
Thanks Received: 3,146
No trade today. Even though I was right in my market direction and the target of 1982, ES departed without me.
I realised that I made an error in my upper target. I should have considered yesterday's HVN at 2003 rather than the previous day's vPOC 2007. That means, my confidence would have been higher to short the 2001 high today.
Though I had another opportunity to short the bounce, midday, around 1995, I didn't want to 'regret trade' as the odds of ES moving either direction were equal. It means my stops were more likely to be hit as my stops would have been just above HOD - Prime target for stop runs. In the end, the stops below 1985 were hunted.
One of those days when everything happens as you expected but without you on board.
Being out of the market is the most powerful position to be in, it is like being on the button in Texas holdem and having the opportunity of only having to pay the full price to play when you have pocket Aces, Kings, Queens, and the opportunity to play the lesser pockets for a lower price (risk/position size) when these opportunities show up, the rest of the time you pay nothing.
Being a discretionary trader, price targets for me are ranges for both entries and exits, I am never married to a fixed number, so I am constantly evaluating my RR and if I see potential stormy weather I will be quick to unwind my position. Dollar cost averaging the entries as I look for the turning point helps to minimize risk and unnecessary exits, which can become costly whilst loading up, although when I exit I unwind everything, if the environment is not good enough to have half my position on then it is unwise to have anything on, the RR has changed. Being dragged up and down, up and down indefinately which can often happen (this is the markets normal behaviour) when having fixed entry and exit targets is not only frustrating and costly (missed trades) it exposes you to much more risk with the 50% chance of the market moving against you, it is my view that time in the trade increases risk expotentially. Yes you may leave some of the money on the table by getting out a bit early, but the increase in account balance, subsequent larger position size now possible and additional winning trades more than makes up for this.
Cheers John