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Ron
I use an ATR stop for a simple weekly system I developed for the
Aussie market. I backtested various stops (SD, LLV, MA's) using
TradeSim and found the following ATR stop to be very good. This
formula always has the stop below the close, so an exit signal is
given when the stop drops. This is very similar to the logic you were
using.
{ATR stop}
Numatr:=Input("Multiples of ATR",1,10,2);
Periods:=Input("Periods for ATR",2,200,10);
SL:=C-Numatr*ATR(periods);
If(C<PREV,SL,If(SL>PREV,SL,PREV)) {some people may not like all the
prev statement - but it works extremely well!}
to determine an exit condtion use close<ref("stop",-1) where the stop
is equal to the above formula.
I find this very worthwhile. Haven't had much success with this as a
daily stop method though - need to determine your own parameters.
You can "reverse" the indicator for a trailing short stop.
Steve
--- In Metastockusers@xxxx, Ron <ronber@xxxx> wrote:
> Not knowing anything about what I was doing, but having the
confidence
> gained by my ignorance and sustained by nothing much better to do,
after
> reading this thread I created an upper and lower band
> Upper:C+ATR(21)
> Lower:C-ATR(21).
>
> It appears that when I drop them on a price plot, if I ratchet my
stops
> up staying just outside(below) the lower band I'm kept in a trade
for
> most of the run I would want. Likewise, as the upper band
approaches my
> target, it seems I need to give some serious consideration about
staying
> with the trade or perhaps tightening my stops even further. In some
> cases parabolic SAR seems to have the same sort of results.
>
> Is this at all worthwhile?
>
> Ron
/>.
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