• Australian (ASX) Stock Market Forum

Hello and welcome to Aussie Stock Forums!

To gain full access you must register. Registration is free and takes only a few seconds to complete.

Already a member? Log in here.

Simulated/Hypothetical trades

Discussion in 'Trading Strategies/Systems' started by pavilion103, Mar 14, 2011.

  1. skc

    skc Goldmember

    Posts:
    8,277
    Likes Received:
    303
    Joined:
    Aug 12, 2008
    Closed my position yesterday at 38.5c. Would be interested again if it closes the gap at 31.5c.
     
  2. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    My initial stop is already 12.5% from entry. Are you saying you would consider going even wider than 12.5%? (at what level is the Pivot low?)

    Would you have trailed the stop at all or was it way too early for that?
    If you were in my position, would you exit IMMEDIATELY on an island reversal?
     
  3. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    Pardon my ignorance but did you exit when price trades below the low of the previous day? Is the reason for exiting at this in part due to the fact that it had risen quite rapidly in the preceeding bars?
     
  4. skc

    skc Goldmember

    Posts:
    8,277
    Likes Received:
    303
    Joined:
    Aug 12, 2008
    Yes stop was moved up to 1 tick below the island reversal. This was a runner so it is always susceptible to coming back down on the same slope/angle. Already gave back a fair bit from the high so not interested in holding in the current market.
     
  5. romeo

    romeo

    Posts:
    23
    Likes Received:
    0
    Joined:
    Oct 23, 2007
    Great thread guys, been reading closely and trying to follow. Also half through "master the markets", interesting book so far (pdf)

    I think what tech means by pivot low is 25cents. Ie, the low at the time of the pivot to the upside. (Awaiting confirmation from tech, however I'm probably wrong) If this is the case: I agree that this is a wide stop.

    Perhaps what Tech is saying is that you would not enter where you did because his logical stop is so far away. I fly the flag for newbies and I entered a day later (on the 12th) and got stopped out today. That's the price of education.

    Is this 'strictly' an island reversal as there is no clear gap between the bars from 12th, 13th and 16th of May? Could this be a 50% retrace? Another factor for me is that today's volume is low compared to the days previous (so far anyway).
     
  6. romeo

    romeo

    Posts:
    23
    Likes Received:
    0
    Joined:
    Oct 23, 2007
    cross post from GTE thread but I think it's in theme with this thread.

    10th to 12th of May (Inclusive): we see relatively small spreads, up candles, low volume

    13th of May: small spread, down candle, low volume

    16th of May: (this is what initially got my interest). Wide spread, down candle, high volume (greater than 4x previous 10 days average volume).

    I was thinking that this is a bearish sign because of the high volume that I assume was selling; added to this was the fact that the SP closed on it's low. However I looked to the days previous and wasn't exactly sure. It needed another down day today to confirm the downside. After all, if it's a lot of selling then why doesn't the SP fall?

    Today we have basically no volume with the buyers and sellers at a stand off. Perhaps GTE has some upside potential. However there is a crapload of resistance nearby. The SP tested 42cents a couple of times and I'd like to see it go above this resistance.

    Any other views? Sorry for crappy chart, I only use Westpac at the moment. Looking to get amibroker soon.
     

    Attached Files:

  7. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    What do people think of this one? PTM. After a small consolidation period including up bars on low volume, price has broken below the lowest low on relatively higher volume. Price closed below this point yesterday for the second consecutive day on highish volume.

    Also where would be the best place to put the stop. Is above the consolidation too far from entry price? Cheers
    PTM.png
     
  8. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    Can I please get an opinion on this one?

    I'm testing some old data and want to ask where people think the best stop would be. The percentage of the stop from entry price is shown on the chart. I've entered on confirmation above resistance.

    Is stop 1 a poor stop because it isn't a significant support?
    Is stop 2 too far from entry price or is this ok?

    CSR stop.png
     
  9. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    I'd be interested in some thoughts on how people would manage this trade. I got in it yesterday and it has gapped up a fair bit in the first day. Is it worth moving the stop after one day (e.g. 1 tick under the gap or maybe move it to breakeven)?

    RRL1.jpg
     
  10. Boggo

    Boggo

    Posts:
    3,215
    Likes Received:
    474
    Joined:
    Mar 28, 2006
    There are many factors such as $ at risk, number of shares etc etc that make it impossible for anyone to provide the answer, you need to have a 'what if' method to start with when you enter the trade.
    Under normal circumstances the market does not like gaps and if it comes back to close the gap it may take a few nervous nellies out too which can set off a short run down below the gap.

    You seem to have the understanding in place, only you can work out what works for you when you apply that.

    One of many approaches on the chart (yesterdays) below but not by any means the answer.

    (click to expand)
     

    Attached Files:

  11. skc

    skc Goldmember

    Posts:
    8,277
    Likes Received:
    303
    Joined:
    Aug 12, 2008
    It's a gold stock. Look at the gold chart and see if this stock deserve more breathing space or tight stop.
     
  12. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    Thanks for that Boggo.

    I realise no one is better able to answer my questions than myself through testing and in conjunction with the rest of my system. I have been spending A LOT of time working on specific trading rules recently. I've taken bits and pieces from various places, put them together, tweaked them as I go.
    Having read Curtis Arnold's PPS Trading System most recently one thing I've been playing around with is moving the stop to breakeven when the trade moves into 1R profit (he suggests 2R).
    This is why I am open to ideas.
    I am trying to solidify my strategy to know what I will do in EVERY conceivable scenario. I'm getting there! Making a lot of progress.


     
  13. tech/a

    tech/a No Ordinary Duck

    Posts:
    19,123
    Likes Received:
    3,069
    Joined:
    Oct 14, 2004
    Why do you think he chose 2R and not your 1?
     
  14. Boggo

    Boggo

    Posts:
    3,215
    Likes Received:
    474
    Joined:
    Mar 28, 2006
    Gap closed with a 5 cent overlap as expected so you would have been take out if you had your stop one tick below the gap pavillion.

    Will it resume it's uptrend ?

    You may find that there may be a few sellers in the gap area when this happens, they look and see that it has dropped by 10 to 15 cents and they panic without understanding that it is just a common process occurring.
     
  15. tech/a

    tech/a No Ordinary Duck

    Posts:
    19,123
    Likes Received:
    3,069
    Joined:
    Oct 14, 2004
    Boggo/Pav
    The question then is do you sell at $2.69 or at a close below $2.69 on NEXT open (Being an EOD trade).
    The answer is the results of your testing.
    In absence of testing its something you set as a rule until proven incorrect or improved.
    Its been my experience that either way (Hitting stop or EOD next open) it all smooths out.
    Some better and some worse than each other.
     
  16. Boggo

    Boggo

    Posts:
    3,215
    Likes Received:
    474
    Joined:
    Mar 28, 2006
    I would be having a close look at the low of today as a point of interest tomorrow, ie, you've closed the gap now get on with resuming the climb or else.
    If I was looking intraday then a return to today's earlier low would be a consideration.
     
  17. Mistagear

    Mistagear

    Posts:
    79
    Likes Received:
    2
    Joined:
    Nov 23, 2007
    as per Trends. Beginnings thread.

    RRL stop @282.
    Todays bar (as yet unclosed) creates a downside target of 255.
    My method would be to watch how price approaches the lower swing target to determine possible re-entry.
    Sometimes I place a buy-stop at the exit price if so desired. Considering the volume/range relationship today, I would not have an order in the market as yet.

    Cheers, M
     
  18. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    I haven't had a chance to reply to all posts but interesting that the low was the same as the close on the bar prior to the gap. If stop was placed 1 tick below, would still be in the trade. Anything higher and stopped out.
     
  19. Boggo

    Boggo

    Posts:
    3,215
    Likes Received:
    474
    Joined:
    Mar 28, 2006
    My Metastock weekly breakout scan has RRL as a selection again this week.

    The generated stop is at 2.35 on the weekly.

    A much more stable view than the daily chart.

    (click to expand)
     

    Attached Files:

  20. pavilion103

    pavilion103

    Posts:
    3,278
    Likes Received:
    8
    Joined:
    Dec 14, 2010
    I was hoping to get some thoughts on this one.

    I'm not sure where to put stops on a big gap down day like this one. As you can see I have 2 hypothetical trailing stops.

    1. One tick above the low of the bar prior to the gap (red)
    2. One tick above the high of the bar after the gap (purple

    The purple stop doesn't give much room to move. I seem to think the red stop is quite good but would be interested to see people's logic/thoughts.

    AMP - 2-8-2011.jpg
     
Loading...

Share This Page