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Conrad -
A big advantage to limit orders is maintaining a predetermined
risk/reward ratio for a specific trade. IOW, if you enter a trade
with a stop-loss and a target price and you like to maintain a
certain ratio, say 3 to 1, then you must pass if you can't enter the
trade within the risk/reward parameters. For this reason, I like to
use stop with limit orders.
Obviously, it also depends on the financial instrument, as they
behave very differently. For stocks, I like to enter at the end of
the day; for the S&P, I usually like to wait to test
support/resistance levels. I always recommend "The Taylor Trading
Technique," which theorizes on a market rhythm.
>
> Conrad Bowers wrote:
>
> > A question for everyone: I am a medium term trader (holding times
> > of 0-30 days, typically). For people who trade in this
> > timeframe, have you found it better to enter with a limit order,
> > somehow guessing where low should be today (or in next few days)
> > or is it better to enter at the open once an enty is signalled. I
> > know this is a very broad questions, but any insights? I have
> > tried a combination of popular pivot calcs, linear regression of
> > the lows/highs and lately, comparing the rate of the trend with
> > the average and SD of close-low (for a buy). But the mkt often
> > cares not about my schemes, and I get left behind. I guess the
> > real answer I need to test my signals with and without limit
> > orders for entries, if I can ever get the system coded. But if
> > anyone has suggestions for how to set limits or whether to use
> > limits at all (or sources discussing this), I'd appreciate it.
> >
> >
> > Conrad Bowers
>
>
>
JFB
Shaven Heads Trading
NYC
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