Where to place stop orders

January 22, 2020

 

The general principle with stops is:” either wide or tight“. Anything in the middle gets stopped out. That is why all typical stop methodologies are sub par (chandelier, parabolic sar, swing stops, support/resistance, asf). Counter intuitive stops, the ones that make one feel uncomfortable, typically are better stop methodologies. The problem however is that stops are very hard to implement  and execute. This is especially true for longer time frame trades. Where to place stop orders?

 

Our quad exit tries to solve this problem. One gets a reward through financing a trade (taking 50% of the position off after initial profits). This allows for a mental relaxed state since now risk is eliminated. One plays with the markets money from now on. This allows for easier stop placement and execution. You will feel much more comfortable to allow for wider stops (necessary for trade development and taking advantage of possible longer term trends).

 

Where to place stop orders, daily chart, silver/US-Dollar 01/22/2020, “stopped out”:

 

Silver in US Dollar, daily chart as of January 22nd 2020

 

On the 13th of January we posted in our telegram channel an entry for a long position on Silver. As indicated in our last chart book the aim was to establish a larger time frame long term play, but keeping risk at bay in an expected volatile sideways zone. We were able to take profits the following day to eliminate risk. Counter signals warranted for more partial profit taking on the 20th of January. At this point the stop order was positioned to break even entry levels and shortly after the last part of exposed money got stopped out. This is an example of how an attempt to establish a large time frame positions fails, but failure representing that solid profits are being booked. This allows for further attempts to get positioned while your psychology will support you in these attempts.

 

Gold/US-Dollar 01/22/2020, daily chart, “gold still in play due to wide stops”:

 

Gold in US Dollar, daily chart as of January 22nd 2020

 

The gold position entered at almost the same time shows a similar development with one difference. The final part of the position due to a slightly more bullish tone in the gold market has not been stopped out yet. It might just provide for this opportunity that in addition to shorter term profits the last 25% of exposed capital being attributed to a possibly larger time frame trend with a long term profit horizon.

 

Where to place stop orders
 

When observing masters at work, no matter in what field/profession, the observer is always intimidated with what ease the highly skilled is performing his or her craft. Trading is no different. When stop placement feels cumbersome, it simply means there is rules missing that allow for ease of execution. Mastery in essence is nothing else but having overcome the principle of: “the devil is in the details”. Meaning there is more work to be done if there is a lack of ease. Ease stems from having worked out all the kinks. If there is friction, something is just not right. In trading this means there are typically rules missing. Stop placement is not excluded from these principles.

 

It is this implementation of the quad exit strategy on the daily time frame that allows for longer term positions to be built, to take advantage of monthly and annually time frame trades and trends.

 

Join our free Telegram Group :https://t.me/joinchat/HGe22hDDEEl0LvFGAgEZ9g

 

 

All published information represents the opinion and analysis of Mr Korbinian Koller & his partners, based on data available to him, at the time of writing. Mr. Koller’s opinions are his own and are not a recommendation or an offer to buy or sell securities. Mr. Koller is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations. As trading and investing in any financial markets may involve serious risk of loss, Mr. Koller recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.

 

 

 

Although a qualified and experienced stock market analyst, Korbinian Koller is not a Registered Securities Advisor. Therefore Mr. Koller’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction. Past results are not necessarily indicative of future results. The passing on and reproduction of this report, analysis or information within the membership area is only legal with a written permission of the author.

 

 

Important Trading Risks and Earnings Disclaimers - Terms of Use

 

RISK DISCLAIMER: All forms of trading carry a high level of risk so you should only speculate with money you can afford to lose. You can lose more than your initial deposit and stake. Please ensure your chosen method matches your investment objectives, familiarize yourself with the risks involved and if necessary seek independent advice.

 

 

U.S. Government Required Disclaimer - Commodity Futures Trading Commission. Trading financial instruments of any kind including options, futures and securities have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the options, futures and stock markets. Don't trade with money you can't afford to lose.

 

NFA and CTFC Required Disclaimers: Trading in the Foreign Exchange market is a challenging opportunity where above average returns are available for educated and experienced investors who are willing to take above average risk. However, before deciding to participate in Foreign Exchange (FX) trading, you should carefully consider your investment objectives, level of experience and risk appetite. Do not invest money you cannot afford to lose.

 

EARNINGS DISCLAIMER: EVERY EFFORT HAS BEEN MADE TO ACCURATELY REPRESENT THIS PRODUCT AND ITS POTENTIAL. THERE IS NO GUARANTEE THAT YOU WILL EARN ANY MONEY USING THE TECHNIQUES, IDEAS OR PRODUCTS PRESENTED. EXAMPLES PRESENTED ARE NOT TO BE INTERPRETED AS A PROMISE OR GUARANTEE OF EARNINGS.

 

CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAN ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.

 

 

All information presented or any product purchased from this website is for educational and research purposes only and is not intended to provide financial advice. Any statement about profits or income, expressed or implied, does not represent a guarantee. This presentation is neither a solicitation nor an offer to Buy/Sell options, futures stocks or securities. No representation is being made that any information you receive will or is likely to achieve profits or losses similar to those discussed on this website. The past performance of any trading system or methodology is not necessarily indicative of future results. Please use common sense. Get the advice of a competent financial advisor before investing your money in any financial instrument.

 

Terms of Use: Your use of this educational website indicates your acceptance of these disclaimers. In addition, you agree to hold harmless the publisher and instructors personally and collectively for any losses of capital, if any, that may result from the use of the information. In other words, you must make your own decisions, be responsible for your own decisions and trade at your own risk.

 

Tags:

Please reload

Recent Posts

February 13, 2020

February 13, 2020

February 9, 2020

February 9, 2020

February 1, 2020

Please reload

Stay Up-To-Date with New Posts

Search By Tags

Please reload

join my free

telegram Group

Mentorship

packages

download my

free book