RE: EZ FOOD for Locals - Close Stops ?

["Neil Harrington" <njhprovo@xxxxxxxxxx>]

Gary,

Good comments and question. I don't have an answer for you. I am struggling
with the same ideas and would like to add a second request to the list for
some insightful discussion on especially these following comments of yours:

"My best-performing systems are S&R systems, but they'd do a whole heck of a
lot better if I could figure out a way to have them act a bit more
intelligently in trading ranges.  I've had some success with having them
take trades only in the direction of a larger trend. That tends to reduce
the drawdown as a percentage of net, but typically the net profit drops
drastically.  Usually you'd be a lot better off to just always stay in the
market."

My own research and studies have found that strictly S&R systems tend to
unwisely give up too much of your profit while waiting for the reverse
signal, so I think some form of trailing stop is better than a S&R. But like
you, taking trades only in the direction of a larger trend, looks good in
some ways and bad in others.

Any thoughts or experiences from the group regarding these ideas?

Neil


|  -----Original Message-----
|  From: Gary Fritz [mailto:fritz@xxxxxxxx]
|  Sent: Saturday, August 22, 1998 1:05 PM
|  To: omega-list@xxxxxxxxxx
|  Subject: RE: EZ FOOD for Locals - Close Stops ?
|
|
|  Trader Jack wrote:
|  > design it for stop and reverse, or, always in the market.  for
|  > day traders such as me, and days like today, stops and
|  profit targets
|  > are irrevalent due to the magnitude of the trading range.
|
|  For days like Friday, sure.  Days like that, a simple moving average
|  will make you a fortune.  Unfortunately for us traders, they aren't
|  all like that.  My question is, how do you avoid getting killed with
|  your stop & reverse system when the market goes into a flat trading
|  range?
|
|  My best-performing systems are S&R systems, but they'd do a whole
|  heck of a lot better if I could figure out a way to have them act a
|  bit more intelligently in trading ranges.  I've had some
|  success with
|  having them take trades only in the direction of a larger trend.
|  That tends to reduce the drawdown as a percentage of net, but
|  typically the net profit drops drastically.  Usually you'd be a lot
|  better off to just always stay in the market.
|
|  Any suggestions for good ways to avoid those nasty drawdowns in flat
|  periods?
|  
|  Thanks!
|  Gary
|