Coders Short Term Trade Management Ideas
- Coders Short Term Trade Management Ideas ***
1/ BREAKEVEN AFTER X PIPS
The concept here is that after the price has moved X pips in profit, the stoploss is moved to breakeven + 1 pip.
Basically stops a profit from turning into a loss.
2/ REDUCE LOSS AFTER X PIPS
This concept allows you to have a greater stop loss gap than limit gap and still have the loss equal the same amount as the profit if it gets hit. This one needs an example:
Buy 1 lot @ 1.2000, Limit 1.2015, Stop 1.1980
We have a 15pip limit with a 20pip stop loss.
The price moves down to 1.1990. At this level we are 10pips down. Close out half of the position at this level. If the stop gets hit, you have lost -$150 instead of -$200. If you limit is hit, you still make money.
3/ TAKE PROFIT AFTER X PIPS PROFIT
This one is self explanitory. Entry with 1 lot and close out half after X pips profit.
4/ REDUCE LIMIT AFTER X PIPS LOSS
In my opinion, it’s better to have a 1 pip profit than a 20 pip loss. By reducing your limit price if the trade moves against you by X pips, there is more chance that it will be hit than if you left the limit at the open price + limit level. For example:
Buy 1 lot @ 1.2000, Limit 1.2015, Stop 1.1980
We have a 15pip limit with a 20pip stop loss.
The price moves down to 1.1990. At this level we are 10pips down. Move you limit from 1.2015 down to 1.2001. There is a greater chance that the limit at 1.2001 will be hit, than if you left it at the 1.2015 level.
The examples don’t take into consideration the cost of spreads.
Please post any other short term trade management ideas that you may have.
Understanding grid trading One more random entry like a million others in the global FX market