Tag Archives: Exit

General Business

Tradestation Automated Exit Strategies – Overcome Emotional Trading

All TradeStation traders today have heard about the golden rule of trading, which is to cut your losses quickly and let your profits run. Even though we’ve all heard this sage wisdom, it’s been proven that the normal human behavior is to do just the opposite. Most traders want to ring the cash register as soon as they start getting into profits and will jump out of a winning trade way too soon. On the other hand, most traders don’t want to be wrong about the trades they picked, so they will hold on to losing trades hoping they will turn around and become winners. In essence, the typical human behavior in trading is to cut profits too short and let losses build up to be big ones. Obviously that’s a disaster for a trading account, but it’s why automated exit strategies can be very useful for a TradeStation trader.

With automated exit strategies a trader can use his time and expertise in making the initial trade entries, and then let an automated exit strategy take over the exit management. This accomplishes 2 things:

First, to be successful, TradeStation traders must overcome the natural human tendency of holding their losing trades. Good stop loss management is the risk management aspect that you need in order to overcome this emotional reaction. By putting a stop loss in place you will be protected against large adverse price movements and from holding losing trades too long, which results in excessively large losses. An automated exit strategy is unemotional and will perfectly execute your stop loss exit.

Secondly, the trader’s natural human tendency to take profits too quickly is a major problem that limits a trader’s profits. This emotional reaction results in overly short holding times and small trading profits. By using an automated exit strategy, the exit management is non emotional and is carried out without cutting profits short. This frees the trader to be involved in making more entries while the exit process is elegantly handled for them.

To be a successful trader, you need to overcome the human tendency to make reactionary trading decisions. Automated exit strategies are a great tool for TradeStation traders that have not yet conquered the emotional issues that come up while trading. Using automated exit strategies will free your mind to pick great trade entries while your exits are logically managed following good exit management rules.

Forex Trading Articles

Importance of Knowing The Best Time to Enter And Exit in Forex

The foreign currency is commonly known as the forex market. It is an international financial market, all about money and trading. Trading of different currencies of various countries is done on the daily basis. It has a great trading volume of about $3 trillion which no other financial market has such great trading volume like the forex market.

Forex is all about money and trading of currencies. It is commissions free were the brokers do not charge any commission from the forex trader. Forex is open for all 24 hours in a day, except the weekends that means there is no definite time to trade forex as it is open for all 24 hours a day. All trading in forex takes place in the internet, so the forex traders can trade forex from any part of the world with the help of the internet.

Its main currencies are Euro, Japanese Yen, Australian dollar, Swiss franc and many more. These main currencies always help in making profits. Trading in forex takes place in the internet, by which a forex trader can trade forex from any part of the entire world. Forex market is the most volatile and liquid trading market, were anything can be happened at any moment.

Nothing remains unchanged, it is totally an unbalanced nature market. At one moment the market may fall and at another moment it may rise. So the currency can fluctuate at any moment, hence it is very important for a forex trader to know the best time to enter and exit in the forex market.

By knowing the best or perfect time to enter and exit in forex, the trader can easily and simply make huge amount of profits. As the forex market is open for all 24 hours a day, but it doesn’t mean that a trader can make money at any time. There are certain moments in which the market obtains the opportunities of making money and losses also.

Forex is a risky financial market, so it is better that the trader should gain knowledge about the certain moments at certain times. Therefore, it is very important to know the best or perfect time to enter and exit in forex trading. There are various trading tool and brokers to help the forex traders in increasing their profit potentials. Forex is unlike other trading markets is a commission free, were the brokers do not charge any commission from the forex traders. Thus, forex is the best trading market in the whole world.

Forex Trading Articles

Chandelier Exit Exercised at Forex

The placement of stop orders on the previous highest point of the trade position placed by the forex traders forms the basis of the chandelier exit. It is called so because like chandelier hangs with the ceiling of the room likewise this method of trading exit hangs down from the highest point of the forex trades took place in last sessions.

The distance between the trailing stop and the highest point of the trading can be easily computed either in USD or on the basis of the contract based points. This trailing stop has the tendency to move upward in higher direction as far it can reach to the highest point.

It is measured correctly in Average True Range, a unit of measuring the trailing stop of either the highest high and closest high of the trade moves. There are many factors behind using ATR for measuring the distance between the stop order placed and the highest point is that it is prevailing equally in all spheres of market and another is that it has greater adaptability to the unpredictable changes at the market.

The merit of this chandelier measure exist in the essence that the stop order placed in such condition adjust automatically with respect to the expansion and contraction of the trading moves at the Forex market.

Thus, it forms the fine tuning with the fluctuating market situations of the buying and selling indifferences. It is one of the most commonly exercised trading practices used across the varied portfolios to produce relatively higher outputs.

It is vital that the amendments in randomness can restrain or extend the detachment to the real stop, as the peak points used to sling the chandelier shift only upward. On the other hand, if the traders like to have fewer fluctuations in the stop distance values then trader should use longer moving averages to compute the ATR value of the respective trade move.

In other case, if the trader need to have highly adaptive stop placement then stick to the shorter moving average because shorter trading orders are more adaptive to the fluctuating market conditions.

The nitty-gritty at the back of the adjoin of the exit techniques of channel and chandelier exit is that, at the same time the channel exit is a suitable stop that steadily rises at the beginning of the trade, changing over to Chandelier Exit, it is required to make sure that it protects more of your profit at forex trading platform. This factor made it a profitable trading practice which is more preferred then any other trading practices.

Thus, it helps in making our trades more proficient by shot and long term stop orders placement at the selected trade moves of the market which is responsible for providing extra benefits.

Market Analysis

What Criteria Will You Use To Exit A Trade With A Profit in Stock Market

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Once you reach this stage you are starting to get into the nitty-gritty of trading. Stock Market makers generally make only a few ticks on the majority of their profitable trades. On the other hand, long-term trend followers often need to ride major trends for a long time in order to maximize their profitability in stock market. Once again this is a personal decision but it is important to make some decisions ahead of time for several reasons.

First, oddly enough, one of the most difficult things for many futures traders to do is to ride a winning trade in stock market. When you get into a trade that immediately goes in the right direction the desire to “take the money and run” can be overwhelming. It can also be a huge mistake. For example, if you are a trend following trader who generally experiences 60% losing trades, you absolutely have to have some big winners in order to offset the majority of smaller losses you incur along the way. If you take profits too soon on a regular basis you are essentially shooting yourself in the foot by doing exactly the opposite of what you need to be doing given your chosen approach to trading. (The “hard work” of trading usually involves making and sticking to difficult decisions in stock market. Fighting off the urge to cash out a winning trade when your approach tells you to hold on is a perfect example of his type of “hard work”).

On the other side of the coin, if you are a counter-trend trader—selling into rallies and buying on dips—you may need to take profits more quickly before the trend turns back against you in stock market. If you develop some objective profit-taking criteria which has a realistic probability of helping you to make money and you stick to it trade in and trade out, you are farahead of the majority of other traders in stock market.