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I won't go into the specific techniques I use, however you might start looking
at the chart action itself (price, volume, pivots, support, resistance,
retracements, triangles, flags, etc.) rather than the "purified" output of
various mathematical filters aka indicators. Learn to read and interpret price
and volume action and patterns on a chart and you will not have to rely on
indicators which remove much of the info content, nor will you have to figure
out how to "optimize" indicators for each of the markets you want to trade. It's
easy to drop in a couple of indicators and have them plot automatically while
chartwork requires considerable effort; however the payoff is substantial.
Earl
-----Original Message-----
From: robert <robertr@xxxxxxxxxxxxx>
To: Omega-List <omega-list@xxxxxxxxxx>
Date: Wednesday, June 24, 1998 4:55 AM
Subject: The Best Exit Strategy
>This request goes out to the "old campaigners" who have seen plenty of
>action and survived position trading the futures markets!
>
>I've traded stocks but I'm new to futures. I've noticed that the "pace of
>the game" seems somewhat quicker, the trends seem shorter, the volatility
>higher and volume figures aren't as useful.
>
>I'm in the process of evaluating various mechanical systems to try and find
>something I am comfortable with to trade. I've been able to get my entries
>to about 55 - 60% profitable on a number of markets( I'm testing with back
>adjusted daily data) by using a trend filter such as { ADX(14)>20 and
>Di+(14)>Di-(14)} or {3 MA's and only taking a long position when shortest >
>medium>longest average}. Then I use a trigger such as a volatility breakout
>above yesterday's close to enter long.
>
>My question is WHAT IS A VERY PROFITABLE,EFFICIENT,and ROBUST(as in not
>overly optimised) TECHNIQUE BY WHICH TO EXIT A PROFITABLE TRADE? I can't get
>better than about 30% efficiency for my exits and that leaves a lot of money
>still on the table! Yes, I can optomise the multiplier or length of the
>indicator to a particular set of data but that's not going to be very robust
>over time.
>
>I've tested various combinations of:
> trailing stops such as
>Highest(H,6)-X*AvgTrueRange(10)
> " " " "
> -X*(StdDev,Y)
> RSI(5) going below 50 or 30
> Di+(14) going below DI-(14)
> Highest(H) - $amount
> Exitlong when C<Lowest(L,5)[1]
>
>If from years of experience you have found something that works reasonably
>well across most markets, much of the time and were prepared to share it,
>this neophyte to futures trading would be eternally grateful.
>
>Thankyou for any help you can offer.
>
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