"How many bars/candles do you allow yourself to be wrong or right? And how do you come up with that number?"

In recent times as I go deeper and deeper into trading, I've struggled to pin down this questions answer, often I see my view being right but long after I'm out of position, so I'm trying to quantify what would be the most ideal time for me to stay in trade. I'm not talking about waiting till SL is hit, sometimes that doesn't happen and price just keeps in range without moving much away from the entry, but at that time you are neither in much profit nor loss but just getting stood up by market.

I would like to hear view of expert traders here. I'm sure many of you may have encountered that situation before and may have come up with solutions.

Please excuse if this is already discussed here, I tried searching but didn't find it.

Hi im not expert but i think that doesnt exist any number exact of candles. ITS depends on the context, size of position, where are the stop and a lot of variables. I think the number of candles didnt matter. You can count the time better than count the number of candles for example im scalper and when mi trade are active for 1 hour and is still near the entry i close the trade.
PD: Sorry for my english, im spanish but learing english hope you understand

Roberto

skraadiing 

Hi im not expert but i think that doesnt exist any number exact of candles. ITS depends on the context, size of position, where are the stop and a lot of variables. I think the number of candles didnt matter. You can count the time better than count the number of candles for example im scalper and when mi trade are active for 1 hour and is still near the entry i close the trade. PD: Sorry for my english, im spanish but learing english hope you understand Roberto

I do, and thank you for your response ^^

I mention candle only because if I mention time everyone will have very different answer, but candles would be more easy to narrow down the range of numbers.

I also agree with your assessment that it's usually not a set number, but you also mention that you will wait for 1 hour, so assuming you are trading on 5 min chart (decent enough for scalper, I do the same), that would be around 12 candles.

Thank you and do keep posting, we are all actually from different locations and English isn't my first language either, so don't hesitate to post

LastDino 

I do, and thank you for your response ^^ I mention candle only because if I mention time everyone will have very different answer, but candles would be more easy to narrow down the range of numbers. I also agree with your assessment that it's usually not a set number, but you also mention that you will wait for 1 hour, so assuming you are trading on 5 min chart (decent enough for scalper, I do the same), that would be around 12 candles. Thank you and do keep posting, we are all actually from different locations and English isn't my first language either, so don't hesitate to post

Thank you and you are right i trade in 5 min chart.
AND YES 12 candles aprox are the max i can wait if the trade is going bad but mi sistem are big wins and small losses that mean that if mi trade are going well i can hold more!

Hey @LastDino!

I am not an expert, more like a student of trading

I think the answer evolves with experience for each individual trader. As entry-selection improves so do the likely targets as you may notice if you're anything like me that we often close too early. But we all are still living with the memories of poor entries in the past that impact our expectations.

For my case, with practice I am starting to "forget" the past mistakes and see that further profit targets are indeed obtainable, it is now a process of conditioning myself to hold the trade and let the market work its way to that target, while learning to read (as accurately as I can) the changing market behavior as I'm in the trade.

IMHO, The target is always some variety of support or resistance-level, but the path the market takes to get there is quite non-deterministic and based on all kinds of random events like incoming institutional client orders, etc. How well one can balance entry-selection, patience, perseverence, their own psyche, and how adaptive one is to unforeseen changes in market behavior (and how accurate their "read" of those changes) dynamically impact the target of each trade.

Cheers!

What time frame are you trading? If you are day trading then you close the position at the end of the day.

If your time frame is longer, (mine is for stock trading) then I let the trade play out until I hit my exit criteria.

I trade intraday and try to keep it around 3-6 trades per session. I'm looking for a move that gets off the line fairly quickly and with some motivation behind it, so if I see price stagnating or chopping about I may let it ride for a little, but will kill it as soon as I believe the initial premise behind the trade is invalid.

The risk is mechanical, predetermined, and low... worst case, I've already accepted the loss on the trade... but allowing myself the decision to stay in it or not is a tip of the hat to my discretionary nature LOL.

snax 

Hey @LastDino! I am not an expert, more like a student of trading I think the answer evolves with experience for each individual trader. As entry-selection improves so do the likely targets as you may notice if you're anything like me that we often close too early. But we all are still living with the memories of poor entries in the past that impact our expectations. For my case, with practice I am starting to "forget" the past mistakes and see that further profit targets are indeed obtainable, it is now a process of conditioning myself to hold the trade and let the market work its way to that target, while learning to read (as accurately as I can) the changing market behavior as I'm in the trade. IMHO, The target is always some variety of support or resistance-level, but the path the market takes to get there is quite non-deterministic and based on all kinds of random events like incoming institutional client orders, etc. How well one can balance entry-selection, patience, perseverence, their own psyche, and how adaptive one is to unforeseen changes in market behavior (and how accurate their "read" of those changes) dynamically impact the target of each trade. Cheers!

You pretty much hit the nail on the head. I have both the issues you mention.
1. Historical effect of bad entries
2. Early exits (as you mention perhaps due to above)

While I don't quite want to end the discussion on that note, I do agree that it is pretty much product of our experience and can only improve with time, but quantifying this can be very beneficial as well, more so for me as option premiums can drop rapidly if spot underlying goes stagnant, so I'm more driven in that aspect.

Thank you for responding and you are plenty expert compared to me

LastDino 

[B] I would like to hear view of expert traders here. I'm sure many of you may have encountered that situation before and may have come up with solutions.

My mentor taught me to have an exit strategy (profit and loss) for every entry. The exit strategy is valid for any amount of bars the market needs to achieve price. Of course this means the strategy needs to account for an exit no matter what the market does from news, volume, etc.

For me I find it panful to exceed the average number of bars as predicted in the simulation. Part of me hopes to get out, even at a loss, just to end the trade. For this reason, I use an algorithm rather than manual trading. All too often I need to remind myself to "trust the strategy" so that I do not take a manual premature exit. Sometimes I carry that feeling through a trade that drags on until close (my strategies final exit point). Thank goodness the market closes.