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Originally Posted by scorpion
Like gaz, you said "aiming for 10-20 pips". But why so while the trend is going the right direction? Just let it run until the trend breaks up. If the market retraces, close the position to get breakeven or some profit. Although it's easy being said than done, those wizards can do it, so we can do it too.
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I do a fixed gain like this because we don't know when the trend will turn. BECAUSE they are lagging indicators, the price could be going way down and maybe even lower then we started. Also the market wont be going one direction for a whole long, itll be noisy, go up and down but go in that direction, one might take it as a break of trend.
At the end of this post is a link to a screenshot I took:
-That first fall I circled in red is of 35 more pips. Now I don't know about you but as a human that would make some sirens go off...
-Second red circle is to show around where we would buy
-Blue circle shows that the MACD shows a lot of difference but the low of those candles is around where we bought, I would have taken that as a break in the trend
-Third/Fourth red circle during the down trend shows a break in the MACD, once again
-Last red circle once again goes a crazy in the other direction for about 50 pips, I would have taken that as a break in trend.
The problem is that when the trend breaks, it usually breaks very harshly. I would like to create rules for myself so I don't just say "come on 5 more pips", touch that and then tell myself "its definitely going up, another 10 pips"
Then end up going in a spiral down trend still hoping it will recover. Once I am in the market and my emotions get involved it doesn't work very well. I need a fixed price to take my profit at... I might play around with support and resistance actually...
MACD LINK:
http://www.forex1000.com/FXFisherman/MACD.gif (1080 x 655)