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In a message dated 9/28/98 10:01:38 PM, mulligan@xxxxxxxx writes:
<<Having said all of this, exits still remain a problem for me, espeically
> within a programmed system. I haven't been able to develop the exits
> that I want or that I feel comfortable with.
>
> Lamont Cranston
> "who knows what evil lurks">>
Exits are always much harder than entries. I view it as a matter of control.
When we prepare an entry plan we are able to set conditions that the market
must fulfill before we enter. I usually have only one or two conditions but I
once heard George Lane (of stochastics fame) say that he has a list of twenty
seven conditions that the market must meet before he enters a trade. The
point here is that we get to dictate to the market on our entries. It must do
what we want or we don't enter. We are in absolute control prior to entry.
Once we are in the trade however, the market takes over and does what it damn
well pleases. You can throw your list of conditions out the window because
now the market is the boss. We have to be prepared for anything and thats a
big, big problem. I find that exits must be much more complex than entries
because we have to be prepared for anything that the market decides to throw
at us. The market has a wild imagination. I've seen a lot of strange things
in more than 35 years of trading and I'm sure I haven't seen everything yet.
Exits are the key. If there is such a thing as a "holy grail" in trading I'm
sure its hidden in the exits.
Chuck
http://traderclub.com/
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