Limbering up with some exercise is wonderful for traders, especially if you sit in a chairÂ all day.
Getting up, stretching, getting some fresh air into our lungs, andÂ mentally recharging ourselvesÂ is healthy for us.
Having our stops in the market stretched, however, is annoying at a mimimum, and downright frustrating no matter how many times we rationalize the experience.
Each entry into the market is a “seed” that is planted. Some will bear fruit, some will not. Stops keepÂ a bad apple from ruining the rest of the apples, (and their seeds) in the barrel.
The weekly trend stalled today during the afternoon session. Patient fibonacci traders got rewarded, while those who jumped in at the front end of the zone suffered through a drawdown, or got stopped out.
Missed trades are better than lost money in my opinion, so I am usually conservative in my approach. I prefer to stick with an intradayÂ trend until we get to a compelling reversal area. Today’s top came right at such a zone, and the risk/reward changed dramatically at the 123 higher top.
Stop placement is an art, and I can honestly say there is no one method that works best for everyone.Â We need a little breathing room, but not too much. Better to lose a little, go to the sidelines and think clearly.
Some traders useÂ a one point stop, some use 1.5; some use 2 or 3 points. A few use 5 to 10 points. The most I have heard a trader admit to using is 30 points, and his target is 10 point profit.
Works for him, not for me.
My reverse button works just fine when my dynamic pivot gets hit. I figure it’s better to be making money than to argue with the market.