At some point everyone would make a bad trade.. what is important is that we know how to get out of a bad trade as quickly as possible. Below is an example of getting out of a bad trade. The good thing for this entry was that swap is on my side. This builds up confidence in holding the position and help ease my mind when stacking up trades that was against me.
Below is an example of trading out of a bad trade. I am not here to show you how to trade but the concept of trading out of a bad trade. Some people hedge others use stop to get out of a bad trade. I let it rollover, stack it up and get it going.
As shown below my pending order was triggered in and the market went all the way against me. From the looks of it the position is really bad. I believe it was cause by a news release spike. What I did next was to top up on the position as it continue to go against me. Of cause when I stack up my position at this point of time it was with indication that price would change direction. It is common that news release spike often will have a retracement, the trick is to catch it.
What I would do is look for indication that price is ready to retrace from a smaller time scale and stack up your trade. As you do this do it with a slightly larger position Calculate the Average break even price and see if it is close to your comfortable exist point.
For this example my initial exit point was at the monthly pivot, but due to the fact that Stoch is showing over sold I decided to exit early. I took an average profit and exited a bad trade.
Important: This method can only be used if your initial position is small and you have the capability to hold your trade for a long period.
This trade was traded using your Robot? Look like a martingle style.
ReplyDeleteI was wondering , why would you be entering this trade when the Stosh is crossing for up exiting from over sold.
The first entry was a pending order.. Drawn a TL above and thought would slide down. Second and 3rd entry was based on a different time chart. Once i got in 3 entry I decide to hang in there as it wasn't normal that it took so long to retrace. Was monitoring the 4hr Stoch to decide when to exit. Just sharing the overview, not the minute thinking process of the trade which is why i took the pic from 4hr chart. -DC
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