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Bob and Alan:
Good info. Thanks. As you have stated, Bob, the entries are the determining
factor for the others in many ways.
You guys know this, but it should also be noted that if your entry is not
optimal, your liklihood of being able to stay in the trade is smaller, as is
your ability to trade for a shorter period and still have a decent reward:
risk. That is, poor entries require larger entry risks to prevent being whiped
out of the trade, and poor entries require a longer holding period or better
trending pattern to make the trade worthwhile. Poor entries will both reduce
your percent profitable trades and your average trade. The stops required, are
therefore directly related to how optimally you can achieve entry without
lowering the percent of profitable trades. Also, many small accounts do not
have the luxury to decide whether to run 2 or 15 cars. So #1 (position) may not
be applicable, #2 (trade management) is dependent upon your entry. #3
(assessing of market environment) also is determined by wanting to get a good
entry as well as some prediliction for the continuance of the direction entered,
long enough to create a good reward to risk. (For example, one may decide not
to trade during the midsession so as to avoid the light volume and the scalping
games of the floor piranha).
So, from my experience (scalping and short term daytrading), entries are #1.
Your time frame for a trade may be a determining factor for the ordering of your
priorities.
Good idea for discussion, Valinda.
Don
Bob Heisler wrote:
> I would prioritize them this way, and also add a couple of things.
>
> 1) Position size (no 1-lots)
> 2) Trade Management (stop placement, exit strategies, add-ons, etc.)
> 3) Sensitivity to the market environment (particularly for intraday trading)
> 4) Reading the price action (Entries, but also determines all of the above)
> 5) Trading without an OPINION or BIAS to market direction
>
> And I couldn't agree with Alan more that the entries are the least important
> as they are meaningless without the first 4 items.
>
> Bob Heisler
> www.rjhtrading.com
>
> -----Original Message-----
> From: Alan Courchene <positionsize1@xxxxxxxxx>
> To: List Omega <omega-list@xxxxxxxxxx>
> Date: Tuesday, February 15, 2000 4:20 PM
> Subject: Re: Which holds best promise?
>
> >I would prioritize them this way:
> >
> >1) Position adjustments (POSITION SIZE)
> >2) Stop management (RISK MGMT)
> >3) Pattern recognition (ENTRY)
> >
> >
> >IMHO,
> >One and two are key!
> >Three is far less important.
> >
> >Alan C.
> >
> >
> >
> >--- TradeWynne@xxxxxxx wrote:
> >> In a message dated 2/15/00 11:38:43 AM Pacific
> >> Standard Time,
> >> Valinda48524@xxxxxxx writes:
> >>
> >> > Which of the following trading approaches holds
> >> the most potential?
> >> >
> >> > 1) Position adjustments
> >> >
> >> > 2) Pattern recognition
> >> >
> >> > 3) Stop management
> >> >
> >>
> >> Valinda:
> >>
> >> Why are any of these mutually exclusive?
> >> I would do my best with all three.
> >>
> >> Bill Wynne
> >> SmartTrades.com
> >>
> >>
> >
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