Concerning the importance of trade exits, after a little thought I remember how difficult it was finding a good consistent exit. Most exits seemed inconsistent and this made half of trading seem somewhat vague. It was after the discovery of a simple formula for using multiples of the Average True Range indicator that all exits were consistent and trading moved to a higher level. With the use of the ATR formula for stops, exits now take on a feeling of less importance as they are always right there on all my charts and the focus is on entries. Here is the formula used in Metastock. Of course the 1.5 can be replaced with whatever number that works the best with a system and the formula can be expanded. This might help some who have experienced the same problem as I did. It can be plotted as small dots above and below prices. This is the only formula used that is not my own. And since it was given to me Ill pass it on. It was found on a website about 10 years ago before the regulators shut it down for some false claims. The website seemed to have value and it was a shame and unnecessary to make false claims mainly about the traders own trading record. One of the claims was he was trading with his own money. Dont remember his name. Turned out he couldnt trade himself and so he taught others what was learned from his father and grandfather.
C+ATR(14)*1.5;
C-ATR(14)*1.5
One thing to be remembered when giving trading help or hints. If we gave people the system of a trader who has made millions most would go bankrupt with that same system. And when they wonder why, answers would begin to come. ( Those who give will receive far more than what was given.) Of course that is the wrong reason to give. Give expecting or wanting nothing in return. This is the obvious for many but for some this may be new or disbelieved.
Trading is the best measure of a correct state of mind there is! Trading can teach us much more than how to make or lose money! In fact in a truly correct state of mind money has little meaning. And since it has little meaning there is no more chasing. When we chase something it will usually run from us. Greed is a different label for chasing.
Some of us here at C2 need to lighten up. Everyone will do better when the competition and finger pointing is dropped and we work together. Trading can cause tension, stress and a host of other negatives which can be let go or eliminated by conscious choice. There is a sense of possible change taking place here, lets carry it further. Perhaps more customers or subscribers will then contribute in the forums as well as more venders and we can all benefit.
Negative responses should no longer be tolerated by Matthew. The same response could be worded in a helpful and positive way. Would it be possible for a vote against negative responses and after so many negative votes there would be an ignore for X period of time. Second offense longer. Negatives work against everything, every time, everywhere. Everyone reading the forums here has been harmed on some level.
Want to make one thing clear, I’m not suggesting anyone else leave a formula here or any trade secrets. What I wrote will not make money for anyone unless they put a lot of their own work into it. In fact it may be worthless to most.
Futurm *,
So what are “C” and “ATR” (how are they calculated or derived)? I’m guessing C = cost and Metastock gives numerical values for the range.
Regards,
Gilbert
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