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Ian:
Use two types of stops. One for initial stop for some initial Xdays after
you enter the trade. This stop should be slightly loose. Then after you
confirmed at the right track then put a tighter stop such as volatility
stops. Initial stops may be some type of channel stops (i.e. lowest low of
Ndays). I hope this will minimise the problems.
Bhanja
-----Original Message-----
From: Lionel Issen <lissen@xxxxxxx>
To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
Date: Tuesday, April 04, 2000 10:20 PM
Subject: Re: Trailing Stop
>Ian:
>There was a discussion here about a year ago on Omnitrader, and at least
one
>contributor pointed out that the multiple indicator system of Omnitrader
>will give poorer signals than a single indicator as a multiple indicator
>will give you a sort of average result (which includes the poorer signals)
>which is less than any of the better indicator results. Another point to
>remember: in "The New Technical Trader" Chande a Kroll point out that
>price-only based indicators are highly correlated.
>
>Lionel Issen
>lissen@xxxxxxxxx
>----- Original Message -----
>From: Ian Burgoyne <iburgy@xxxxxxxxxxx>
>To: <metastock@xxxxxxxxxxxxx>
>Sent: Tuesday, April 04, 2000 5:20 PM
>Subject: Trailing Stop
>
>
>> I've been trying to improve my position trading by using a volatility
>> indicator to exit long positions primarily to protect profits. I like the
>> concept of a volatility stop as it is directly linked to the ranging
>> activity of the security. A number of them have been discussed on this
>forum
>> such as the Volatility Stop (Long) by Chande & Kroll, Trading The Trend
by
>> Andrew Abrahams, ATR Trailing Stop by Yngvi Hardarson and the Count Back
>> Line by Daryl Guppy.
>> I've attached a chart of a trade I exited today.
>> Acting on the exit signal given by all the indicators yesterday I exited
>too
>> late and gave up about 72% of available profit which is way too high a
>price
>> for my liking. By using a lower multiplier of the ATR I would get a
>tighter
>> stop but often it can take you out of a trade prematurely. Had I based my
>> exit on the trendline I would have exited yesterday.
>> I know it's difficult to counter a gap move down like this one but can
>> anyone suggest a better method which will keep a good portion of profits
>yet
>> not exit trades too early.
>> regards
>> Ian Burgoyne
>>
>>
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>
>
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