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Hi Steve,
Of course you'd use Stops, or , if you're a day trader / scalper, watch
the market
movements by the second ! . Also, as part of a traders' techniques, it
would be
very helpful - should I say necessary ? - to have statistics about the
market
you 're trading.
As all of us know,after the open, prices almost always ( maybe 90 % + )
make
a small move against the predominant move of the day / week / month,
that's
the small price range above or below the open I call the 'Open stick'. I
know,
sometimes the Open ends up in the middle of the trading range, but , as a
general tendency, it is either close to the high or the low.
For example, the Swiss Franc. I know it's made a maximum 'open stick' of
55 points ( the Sept contract ) for the last seven or eight moths, with
an
average of 7 points. Also, the average daily range has been about 44 pts
If I'm going to enter long , I wait ( right after the open ) to see
prices go below
the open, when approaching the 7 point - average I place my order with a
stop loss of 20 points ( $ 250 ) below my entry. If prices keep going
down
and hit my stop, well, plain simple : I WAS WRONG. Take it gracefully and
be ready for your next trade.
How can you lose your shirt this way? . YES, you can, if you don't have
that
mysterious 'factor OC' indicator / strategy / approach to tell you that
the close
was going to be ABOVE the Open ( yeah, even if it was a tick ! ).
But, definitely DISCIPLINE ( and knowledge ) is going to play a big role
in controlling your loses.
Of course, these are my ideas and I will always respect yours.
Good trading !
Efrain R Portales
Fort Worth
efrain12@xxxxxxxxxxxx
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