https://imgur.com/a/VnsXN6x
Above is the chart for Burj, a great steamer that I think looked a viable move from about 1.8 down to 1.5. I "knew" this was coming in, because of various other signals, but what I am struggling with here is getting the right entry, as I entered at about 1.7 and it drifted and so I exited, of course for it to duly come back in.
Currently I perceive my issue to be waiting for steamers to break out of their range before I back them i.e. I want a 'certain' trade, but am aware that thinking in probabilities is pertinent here also.
Perhaps the help I'm looking for is around the notion of support/resistance, or perhaps having better understanding from a technical analysis POV. Any guidance much appreciated
Help with a specific trading issue...chart included!
-
ShaunWhite
- Posts: 9731
- Joined: Sat Sep 03, 2016 3:42 am
It drifted, but not very much, out to 1.72 or 1.73 from your chart?
My initial impression is that you are being shaken off by market noise. If you backed at 1.7 I'd probably think the trade had broken down at about 1.8ish. If that seems too far for you then perhaps your staking might be a little too big.
As for support resistance, the jury is split. Personally I like to see the market in terms of tradiational odd (because I'm ancient). Decimal odds are featureless apart from the round numbers.
You entered when the price looked like it was going below 8/11, unless it went up to 4/5 I wouldn't consider that to be on the drift and jump out. I see it then went down to 8/13, steadied, then had a shade more action down to 4/7, 8/15ish before the start. The exchange is decimal but so much of the punting world is still traditional odds.
Just an idea, other might disagree.
My initial impression is that you are being shaken off by market noise. If you backed at 1.7 I'd probably think the trade had broken down at about 1.8ish. If that seems too far for you then perhaps your staking might be a little too big.
As for support resistance, the jury is split. Personally I like to see the market in terms of tradiational odd (because I'm ancient). Decimal odds are featureless apart from the round numbers.
You entered when the price looked like it was going below 8/11, unless it went up to 4/5 I wouldn't consider that to be on the drift and jump out. I see it then went down to 8/13, steadied, then had a shade more action down to 4/7, 8/15ish before the start. The exchange is decimal but so much of the punting world is still traditional odds.
Just an idea, other might disagree.
You do not have the required permissions to view the files attached to this post.
Hi mate, simply put, you have exited too soon. Your problem's not with your entry, it's with your exit.
Get ya pen and paper out... it's homework time
You said:
"Currently I perceive my issue to be waiting for steamers to break out of their range before I back them"
I wouldn't say that's an issue at all, it's just a type of setup i.e. You wait for X situation to occur, and when it does, you enter. Absolutely fine.
Whether or not your setups are value entries is a different matter, but seeing as you have to take a load of trades anyway where the setup occurs in order to determine whether or not they are of value means it's a bit of a moot point.
I've seen this a lot with forex traders who obsess over their entries when they ought to be focusing on their trade management.
Again, when X situation occurs, you enter. Bam. Entry out the way. That being said, if you do notice trades are going against you consistently, then you can play the 'what-if' game on your previous trades (same setups) until you find a more sensible entry.
Once the trade is open, now you need to manage your trade
Where's my exit going to be for this specific trade? Why?
Where will I take profit? Why?
Think about the differences between having a clear plan to manage your trade, versus winging it:
A) Telling yourself "if LTP hits X I'll exit because of Y" is specific and easy for our brains to process (meaning there's a high chance of committing to the exit)
B) Telling yourself "I'll enter this trade and exit when it feels like I should" is very hazy and leaves our brains much room for interpretation, if you don't have a useful knowledge base of trading experience up in your noggin to draw upon then your brain's going to come up with a load of trollop to fill in the gaps and justify why you should/shouldn't exit, I guess that's why I'd argue it's a style for advanced traders
A few pointers:
1) Your entries should always be positions of value or positions that you think are value.
In your case, this is where you say you "knew" it would come in (think you mean likely
)
2) Your entry needs to have an accompanying exit style which you've decided on either before you place the trade, or very soon afterward. If you're using a set exit price, the longer it takes you to decide on that price, the more emotional, and the less logical your justifications for that exit price become.
Exit styles can come in a few forms:
- static exit price
- dynamic exit price (e.g. trailing stop)
- trigger-based (e.g. there's been a situational change / first horse enters stalls / 00:30 to post time / IP Take SP / etc.)
3) Justify! Understanding why your entry is of value should help you determine when it's sensible to exit.
...Mess with whatever exit styles you want, but ensure you have that justification because without it, you might:
a) Struggle to pull the trigger in the moment when you should be exiting (lack of confidence behind the decision means you're able to convince yourself of new rationalisations as to why you should hold onto the trade)
b) End up taking exits at various inefficient places, which will all add up and have a massive impact on your longer-term P&L (e.g. setting stops 5 ticks away from where you enter without considering previously traded ranges)
I'm not sure which is worse A or B
You don't need a defined exit, it's just easier and makes the decision-making process much smoother and less taxing for your brain.
In fact, depending on things such as personality/experience/attentiveness/etc., it may be more effective for you to manage your trades on the fly. The proof will be in the pudding as it were... it should be quite clear based on your P&L results for different styles. For me personally, I'm open to making huge errors when using certain styles of trade management, and able to completely avoid them by using another: I'm the same person... in the same situation... but I'm making different decisions at different times and its crazy to see how a little tweak in how you manage a trade can affect your results so dramatically. I would guess this is what people are talking about when they say you need to find a trading style that matches your personality.
If your exits are triggered by a change in situation rather than using defined exit prices, you open yourself up to be overcome by your emotions once in the position e.g. self-talk can begin in your head and you might begin to constantly analyse the current price action and make decision after decision as to whether or not you should exit (and rationalising why each time). All these little decisions quickly become tiresome/stressful. Same goes for taking profit. All the rationalisations you make in these situations can have very little substance to them, often being wildly inaccurate due to weighting the significance of things that are happening in the market poorly (normally we'll over-exaggerate on the loss side of things because our money is on the line). This means that unless you've ridden yourself completely of the great psychological barrier known as loss aversion, you're probably going to be doing your results more harm than good.
...an example of this:
You're in a trade, you don't have a defined exit price, you're just monitoring the activity, occasionally asking yourself "do I think I'm wrong on this?", and looking to exit on gut feel. Something happens and you think to yourself "Oh, X/Y/Z has happened, so I better exit now before I become worse off in the future than I am now!".
It's super important to realise that those justifications + rationalisations are made from an emotional point of view, and the justification for the first exit price (before/as you open the position) is made from a logical point of view. That's why I recommend starting out with static exits and only switching to dynamic exits or exits based on a change in situation once you've analysed past results and can quantifiably prove that you'd be better off using them.
Your example:
By reframing my pointers into questions you should get an idea of what you did wrong here and how you can improve for the future.
Ask yourself:
1) Was my entry of value?
I mean this was basically your initial question but you can ignore this one -- yes it was.
2) What was my agreed exit trigger?
[Gut feel / Agreed exit price / If price goes 3 ticks against me / etc.]
3) When did I actually exit in the end? Was it justified?
[Thought I was wrong on the trade / My agreed exit price was touched so I closed / Price went 3 ticks against me / etc.]
4) Were my exits logical or emotional?
Loss Aversion? If emotional, then how can you adjust how you trading to where you're making logical decisions? Switch exit styles?
Regardless of your answers, it's clear you have exited too soon given the entry.
For the future make sure you're recording the times where this happens, and loosen your stops until this happens less often.
...If you were exiting based on gut feel (change in situation), then you've probably exited too early due to being in your own head and crumbling under pressure when you saw the position go against you. It's perfectly normal to have some push back when a range is broken. If a shorter term correction to a longer-term move is enough for you to lose your bottle and close a trade you were confident about, then perhaps you're not ready for this style of exit yet, or perhaps in this specific instance you backed more £££ than normal due to your confidence in the position and the amount you had at risk exceeded your risk tolerance level (need to build this up slowly over time).
...If you instead used a set exit price then you've exited too soon due to picking an inefficient exit price (and justifications for that price).
If that's the case play the 'what-if' game like I mentioned at the start of the post, once you find the price(s) that would keep you in the trade, look at the history of the chart at those prices and try to understand why that would've been a better place to set your exit (justify).
This would be my thought process for your example:
(identifying a sensible exit price + justifying it)
As we've just broken 1.70 for the first time, I expect that previous resistance to now become possible support, so if the price begins to go against me, I'll have to accept that I'm wrong on the trade if 1.70 gets broken back. Therefore it makes the most sense to exit when 1.70 gets significantly broken -- so at like 1.73/1.74.
Obviously this is the long version for the sake of explaining clearly, in your head this will only take a couple of seconds to work out (in an ideal world you'd work this out before you're in the trade when you are your most logical self
)
If might help you to know that I'd also take some profit on reaction to that massive spike then hedge the rest @ sp (or if my static/dynamic stop was hit).
The previous price history along the blue line should highlight why it'd be a good entry, and is what I'm talking about when I'm on about previous resistance becoming support. It looks like 1.70/1.71 was touched on the graph so I guess you exited there. You never want your stops too tight to the ranges because you'll often see a bit of spillage as people try to push through ranges with large orders here and there to start a move. If you think about it in terms of Risk/Reward: you're risking 1 or 2 ticks extra on your stop compared with a potential for a medium-large amount of ticks if the range holds. You definitely don't want 'spillage' stopping you out too often.
Notes:
- Dynamic exits are much more mentally draining if you don't use a stop loss tool as you have to constantly keep track of where you should exit
- Technically speaking static/dynamic exit prices are also trigger-based but they're way more common so I've put them in their own category
- There's no reason why you can't use changes in the situation to trigger an exit alongside your already defined set exit prices (dynamic or static), but again, if you're not past that pesky loss aversion phase then you may end up convincing yourself into taking profit too early when trades are going well
- Remember when you said you "knew" the price was going to come in? Well hopefully you can see now that if you truly knew, you wouldn't have exited at all / so soon. Exiting early like that is actually a clear-cut sign that you were very much unsure in the moment about the trade.
We can never be fully sure about a trade, I recall P saying in a vid that even the most perfect of trade setups would only ever be 99.x%!
That's a nice reminder for why we need to manage our position sizing on every single trade
- Btw try out the 'Snipping Tool' app that comes preinstalled on Windows machines the next time you want to save an image of a Betfair chart
Word Count: 2218
Reference List
N/a
Get ya pen and paper out... it's homework time
You said:
"Currently I perceive my issue to be waiting for steamers to break out of their range before I back them"
I wouldn't say that's an issue at all, it's just a type of setup i.e. You wait for X situation to occur, and when it does, you enter. Absolutely fine.
Whether or not your setups are value entries is a different matter, but seeing as you have to take a load of trades anyway where the setup occurs in order to determine whether or not they are of value means it's a bit of a moot point.
I've seen this a lot with forex traders who obsess over their entries when they ought to be focusing on their trade management.
Again, when X situation occurs, you enter. Bam. Entry out the way. That being said, if you do notice trades are going against you consistently, then you can play the 'what-if' game on your previous trades (same setups) until you find a more sensible entry.
Once the trade is open, now you need to manage your trade
Where's my exit going to be for this specific trade? Why?
Where will I take profit? Why?
Think about the differences between having a clear plan to manage your trade, versus winging it:
A) Telling yourself "if LTP hits X I'll exit because of Y" is specific and easy for our brains to process (meaning there's a high chance of committing to the exit)
B) Telling yourself "I'll enter this trade and exit when it feels like I should" is very hazy and leaves our brains much room for interpretation, if you don't have a useful knowledge base of trading experience up in your noggin to draw upon then your brain's going to come up with a load of trollop to fill in the gaps and justify why you should/shouldn't exit, I guess that's why I'd argue it's a style for advanced traders
A few pointers:
1) Your entries should always be positions of value or positions that you think are value.
In your case, this is where you say you "knew" it would come in (think you mean likely
)2) Your entry needs to have an accompanying exit style which you've decided on either before you place the trade, or very soon afterward. If you're using a set exit price, the longer it takes you to decide on that price, the more emotional, and the less logical your justifications for that exit price become.
Exit styles can come in a few forms:
- static exit price
- dynamic exit price (e.g. trailing stop)
- trigger-based (e.g. there's been a situational change / first horse enters stalls / 00:30 to post time / IP Take SP / etc.)
3) Justify! Understanding why your entry is of value should help you determine when it's sensible to exit.
...Mess with whatever exit styles you want, but ensure you have that justification because without it, you might:
a) Struggle to pull the trigger in the moment when you should be exiting (lack of confidence behind the decision means you're able to convince yourself of new rationalisations as to why you should hold onto the trade)
b) End up taking exits at various inefficient places, which will all add up and have a massive impact on your longer-term P&L (e.g. setting stops 5 ticks away from where you enter without considering previously traded ranges)
I'm not sure which is worse A or B
You don't need a defined exit, it's just easier and makes the decision-making process much smoother and less taxing for your brain.
In fact, depending on things such as personality/experience/attentiveness/etc., it may be more effective for you to manage your trades on the fly. The proof will be in the pudding as it were... it should be quite clear based on your P&L results for different styles. For me personally, I'm open to making huge errors when using certain styles of trade management, and able to completely avoid them by using another: I'm the same person... in the same situation... but I'm making different decisions at different times and its crazy to see how a little tweak in how you manage a trade can affect your results so dramatically. I would guess this is what people are talking about when they say you need to find a trading style that matches your personality.
If your exits are triggered by a change in situation rather than using defined exit prices, you open yourself up to be overcome by your emotions once in the position e.g. self-talk can begin in your head and you might begin to constantly analyse the current price action and make decision after decision as to whether or not you should exit (and rationalising why each time). All these little decisions quickly become tiresome/stressful. Same goes for taking profit. All the rationalisations you make in these situations can have very little substance to them, often being wildly inaccurate due to weighting the significance of things that are happening in the market poorly (normally we'll over-exaggerate on the loss side of things because our money is on the line). This means that unless you've ridden yourself completely of the great psychological barrier known as loss aversion, you're probably going to be doing your results more harm than good.
...an example of this:
You're in a trade, you don't have a defined exit price, you're just monitoring the activity, occasionally asking yourself "do I think I'm wrong on this?", and looking to exit on gut feel. Something happens and you think to yourself "Oh, X/Y/Z has happened, so I better exit now before I become worse off in the future than I am now!".
It's super important to realise that those justifications + rationalisations are made from an emotional point of view, and the justification for the first exit price (before/as you open the position) is made from a logical point of view. That's why I recommend starting out with static exits and only switching to dynamic exits or exits based on a change in situation once you've analysed past results and can quantifiably prove that you'd be better off using them.
Your example:
By reframing my pointers into questions you should get an idea of what you did wrong here and how you can improve for the future.
Ask yourself:
1) Was my entry of value?
I mean this was basically your initial question but you can ignore this one -- yes it was.
2) What was my agreed exit trigger?
[Gut feel / Agreed exit price / If price goes 3 ticks against me / etc.]
3) When did I actually exit in the end? Was it justified?
[Thought I was wrong on the trade / My agreed exit price was touched so I closed / Price went 3 ticks against me / etc.]
4) Were my exits logical or emotional?
Loss Aversion? If emotional, then how can you adjust how you trading to where you're making logical decisions? Switch exit styles?
Regardless of your answers, it's clear you have exited too soon given the entry.
For the future make sure you're recording the times where this happens, and loosen your stops until this happens less often.
...If you were exiting based on gut feel (change in situation), then you've probably exited too early due to being in your own head and crumbling under pressure when you saw the position go against you. It's perfectly normal to have some push back when a range is broken. If a shorter term correction to a longer-term move is enough for you to lose your bottle and close a trade you were confident about, then perhaps you're not ready for this style of exit yet, or perhaps in this specific instance you backed more £££ than normal due to your confidence in the position and the amount you had at risk exceeded your risk tolerance level (need to build this up slowly over time).
...If you instead used a set exit price then you've exited too soon due to picking an inefficient exit price (and justifications for that price).
If that's the case play the 'what-if' game like I mentioned at the start of the post, once you find the price(s) that would keep you in the trade, look at the history of the chart at those prices and try to understand why that would've been a better place to set your exit (justify).
This would be my thought process for your example:
(identifying a sensible exit price + justifying it)
As we've just broken 1.70 for the first time, I expect that previous resistance to now become possible support, so if the price begins to go against me, I'll have to accept that I'm wrong on the trade if 1.70 gets broken back. Therefore it makes the most sense to exit when 1.70 gets significantly broken -- so at like 1.73/1.74.
Obviously this is the long version for the sake of explaining clearly, in your head this will only take a couple of seconds to work out (in an ideal world you'd work this out before you're in the trade when you are your most logical self
)If might help you to know that I'd also take some profit on reaction to that massive spike then hedge the rest @ sp (or if my static/dynamic stop was hit).
The previous price history along the blue line should highlight why it'd be a good entry, and is what I'm talking about when I'm on about previous resistance becoming support. It looks like 1.70/1.71 was touched on the graph so I guess you exited there. You never want your stops too tight to the ranges because you'll often see a bit of spillage as people try to push through ranges with large orders here and there to start a move. If you think about it in terms of Risk/Reward: you're risking 1 or 2 ticks extra on your stop compared with a potential for a medium-large amount of ticks if the range holds. You definitely don't want 'spillage' stopping you out too often.
Notes:
- Dynamic exits are much more mentally draining if you don't use a stop loss tool as you have to constantly keep track of where you should exit
- Technically speaking static/dynamic exit prices are also trigger-based but they're way more common so I've put them in their own category
- There's no reason why you can't use changes in the situation to trigger an exit alongside your already defined set exit prices (dynamic or static), but again, if you're not past that pesky loss aversion phase then you may end up convincing yourself into taking profit too early when trades are going well
- Remember when you said you "knew" the price was going to come in? Well hopefully you can see now that if you truly knew, you wouldn't have exited at all / so soon. Exiting early like that is actually a clear-cut sign that you were very much unsure in the moment about the trade.
We can never be fully sure about a trade, I recall P saying in a vid that even the most perfect of trade setups would only ever be 99.x%!
That's a nice reminder for why we need to manage our position sizing on every single trade
- Btw try out the 'Snipping Tool' app that comes preinstalled on Windows machines the next time you want to save an image of a Betfair chart
Word Count: 2218
Reference List
N/a
You do not have the required permissions to view the files attached to this post.
this was my effort on that particular market yesterday.. & my take on it
from the graph Burj was supported throughout the day & with that a possible extension on the move, I just waited for something to tell me that the move was likely to continue which for me was the push down from 1.80ish along with sizeable back bets queued up above the available price.. to me that wanted to get matched, they weren't fake because of the nature of the market & the amount of them, if memory serves there was a quite a sizeable back net that pushed the price down to around 1.58ish, I didn't wait for the market to panic & retrace so I bailed out about there, I got out there because in the past I've been greedy & held on & held on only for the move to revert back to scratch, was happy with the result & moved on.
When I look at a market now I have a predetermined idea of what is likely to play out, the BF chart in this instance as well as other stuff, (traded volume for example) helped make my mind up to back this runner.
from the graph Burj was supported throughout the day & with that a possible extension on the move, I just waited for something to tell me that the move was likely to continue which for me was the push down from 1.80ish along with sizeable back bets queued up above the available price.. to me that wanted to get matched, they weren't fake because of the nature of the market & the amount of them, if memory serves there was a quite a sizeable back net that pushed the price down to around 1.58ish, I didn't wait for the market to panic & retrace so I bailed out about there, I got out there because in the past I've been greedy & held on & held on only for the move to revert back to scratch, was happy with the result & moved on.
When I look at a market now I have a predetermined idea of what is likely to play out, the BF chart in this instance as well as other stuff, (traded volume for example) helped make my mind up to back this runner.
You do not have the required permissions to view the files attached to this post.
I`m finding this thread informative but instead of picking over the bones of a past race that many of us may not have seen, could we nominate a race beforehand then have the views on what is seen / traded after.
That's almost impossible as all that activity you see on the right side of the graph is 10-15mins, so to have a narrative real time is almost impossible.
may not be a goer as many things could happen between now & the off, i.e. horse sweating up, needs reshoeing, will only run with three shoes, rears up in stalls, withdrawals, fat finger bets.. the list goes on
This is a brilliant post; I got alot out of it. Thank you.eightbo wrote: ↑Thu Jun 07, 2018 8:13 amHi mate, simply put, you have exited too soon. Your problem's not with your entry, it's with your exit.
Get ya pen and paper out... it's homework time
You said:
"Currently I perceive my issue to be waiting for steamers to break out of their range before I back them"
I wouldn't say that's an issue at all, it's just a type of setup i.e. You wait for X situation to occur, and when it does, you enter. Absolutely fine.
Whether or not your setups are value entries is a different matter, but seeing as you have to take a load of trades anyway where the setup occurs in order to determine whether or not they are of value means it's a bit of a moot point.
I've seen this a lot with forex traders who obsess over their entries when they ought to be focusing on their trade management.
Again, when X situation occurs, you enter. Bam. Entry out the way. That being said, if you do notice trades are going against you consistently, then you can play the 'what-if' game on your previous trades (same setups) until you find a more sensible entry.
Once the trade is open, now you need to manage your trade
Where's my exit going to be for this specific trade? Why?
Where will I take profit? Why?
Think about the differences between having a clear plan to manage your trade, versus winging it:
A) Telling yourself "if LTP hits X I'll exit because of Y" is specific and easy for our brains to process (meaning there's a high chance of committing to the exit)
B) Telling yourself "I'll enter this trade and exit when it feels like I should" is very hazy and leaves our brains much room for interpretation, if you don't have a useful knowledge base of trading experience up in your noggin to draw upon then your brain's going to come up with a load of trollop to fill in the gaps and justify why you should/shouldn't exit, I guess that's why I'd argue it's a style for advanced traders
A few pointers:
1) Your entries should always be positions of value or positions that you think are value.
In your case, this is where you say you "knew" it would come in (think you mean likely
2) Your entry needs to have an accompanying exit style which you've decided on either before you place the trade, or very soon afterward. If you're using a set exit price, the longer it takes you to decide on that price, the more emotional, and the less logical your justifications for that exit price become.
Exit styles can come in a few forms:
- static exit price
- dynamic exit price (e.g. trailing stop)
- trigger-based (e.g. there's been a situational change / first horse enters stalls / 00:30 to post time / IP Take SP / etc.)
3) Justify! Understanding why your entry is of value should help you determine when it's sensible to exit.
...Mess with whatever exit styles you want, but ensure you have that justification because without it, you might:
a) Struggle to pull the trigger in the moment when you should be exiting (lack of confidence behind the decision means you're able to convince yourself of new rationalisations as to why you should hold onto the trade)
b) End up taking exits at various inefficient places, which will all add up and have a massive impact on your longer-term P&L (e.g. setting stops 5 ticks away from where you enter without considering previously traded ranges)
I'm not sure which is worse A or B
You don't need a defined exit, it's just easier and makes the decision-making process much smoother and less taxing for your brain.
In fact, depending on things such as personality/experience/attentiveness/etc., it may be more effective for you to manage your trades on the fly. The proof will be in the pudding as it were... it should be quite clear based on your P&L results for different styles. For me personally, I'm open to making huge errors when using certain styles of trade management, and able to completely avoid them by using another: I'm the same person... in the same situation... but I'm making different decisions at different times and its crazy to see how a little tweak in how you manage a trade can affect your results so dramatically. I would guess this is what people are talking about when they say you need to find a trading style that matches your personality.
If your exits are triggered by a change in situation rather than using defined exit prices, you open yourself up to be overcome by your emotions once in the position e.g. self-talk can begin in your head and you might begin to constantly analyse the current price action and make decision after decision as to whether or not you should exit (and rationalising why each time). All these little decisions quickly become tiresome/stressful. Same goes for taking profit. All the rationalisations you make in these situations can have very little substance to them, often being wildly inaccurate due to weighting the significance of things that are happening in the market poorly (normally we'll over-exaggerate on the loss side of things because our money is on the line). This means that unless you've ridden yourself completely of the great psychological barrier known as loss aversion, you're probably going to be doing your results more harm than good.
...an example of this:
You're in a trade, you don't have a defined exit price, you're just monitoring the activity, occasionally asking yourself "do I think I'm wrong on this?", and looking to exit on gut feel. Something happens and you think to yourself "Oh, X/Y/Z has happened, so I better exit now before I become worse off in the future than I am now!".
It's super important to realise that those justifications + rationalisations are made from an emotional point of view, and the justification for the first exit price (before/as you open the position) is made from a logical point of view. That's why I recommend starting out with static exits and only switching to dynamic exits or exits based on a change in situation once you've analysed past results and can quantifiably prove that you'd be better off using them.
Your example:
By reframing my pointers into questions you should get an idea of what you did wrong here and how you can improve for the future.
Ask yourself:
1) Was my entry of value?
I mean this was basically your initial question but you can ignore this one -- yes it was.
2) What was my agreed exit trigger?
[Gut feel / Agreed exit price / If price goes 3 ticks against me / etc.]
3) When did I actually exit in the end? Was it justified?
[Thought I was wrong on the trade / My agreed exit price was touched so I closed / Price went 3 ticks against me / etc.]
4) Were my exits logical or emotional?
Loss Aversion? If emotional, then how can you adjust how you trading to where you're making logical decisions? Switch exit styles?
Regardless of your answers, it's clear you have exited too soon given the entry.
For the future make sure you're recording the times where this happens, and loosen your stops until this happens less often.
...If you were exiting based on gut feel (change in situation), then you've probably exited too early due to being in your own head and crumbling under pressure when you saw the position go against you. It's perfectly normal to have some push back when a range is broken. If a shorter term correction to a longer-term move is enough for you to lose your bottle and close a trade you were confident about, then perhaps you're not ready for this style of exit yet, or perhaps in this specific instance you backed more £££ than normal due to your confidence in the position and the amount you had at risk exceeded your risk tolerance level (need to build this up slowly over time).
...If you instead used a set exit price then you've exited too soon due to picking an inefficient exit price (and justifications for that price).
If that's the case play the 'what-if' game like I mentioned at the start of the post, once you find the price(s) that would keep you in the trade, look at the history of the chart at those prices and try to understand why that would've been a better place to set your exit (justify).
This would be my thought process for your example:
(identifying a sensible exit price + justifying it)
As we've just broken 1.70 for the first time, I expect that previous resistance to now become possible support, so if the price begins to go against me, I'll have to accept that I'm wrong on the trade if 1.70 gets broken back. Therefore it makes the most sense to exit when 1.70 gets significantly broken -- so at like 1.73/1.74.
Obviously this is the long version for the sake of explaining clearly, in your head this will only take a couple of seconds to work out (in an ideal world you'd work this out before you're in the trade when you are your most logical self
If might help you to know that I'd also take some profit on reaction to that massive spike then hedge the rest @ sp (or if my static/dynamic stop was hit).
The previous price history along the blue line should highlight why it'd be a good entry, and is what I'm talking about when I'm on about previous resistance becoming support. It looks like 1.70/1.71 was touched on the graph so I guess you exited there. You never want your stops too tight to the ranges because you'll often see a bit of spillage as people try to push through ranges with large orders here and there to start a move. If you think about it in terms of Risk/Reward: you're risking 1 or 2 ticks extra on your stop compared with a potential for a medium-large amount of ticks if the range holds. You definitely don't want 'spillage' stopping you out too often.
Ex1.JPG
Notes:
- Dynamic exits are much more mentally draining if you don't use a stop loss tool as you have to constantly keep track of where you should exit
- Technically speaking static/dynamic exit prices are also trigger-based but they're way more common so I've put them in their own category
- There's no reason why you can't use changes in the situation to trigger an exit alongside your already defined set exit prices (dynamic or static), but again, if you're not past that pesky loss aversion phase then you may end up convincing yourself into taking profit too early when trades are going well
- Remember when you said you "knew" the price was going to come in? Well hopefully you can see now that if you truly knew, you wouldn't have exited at all / so soon. Exiting early like that is actually a clear-cut sign that you were very much unsure in the moment about the trade.
We can never be fully sure about a trade, I recall P saying in a vid that even the most perfect of trade setups would only ever be 99.x%!
That's a nice reminder for why we need to manage our position sizing on every single trade
- Btw try out the 'Snipping Tool' app that comes preinstalled on Windows machines the next time you want to save an image of a Betfair chart
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Reference List
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I was thinking more along the line of picking "a race" rather than a selection to gather the views of the traders and their selections and how they came about the decisions they made and "after" the race not before or during.
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Trader Pat
- Posts: 4327
- Joined: Tue Oct 25, 2016 12:50 pm
arbitrage16 wrote: ↑Wed Jun 06, 2018 2:54 pmhttps://imgur.com/a/VnsXN6x
Above is the chart for Burj, a great steamer that I think looked a viable move from about 1.8 down to 1.5. I "knew" this was coming in, because of various other signals, but what I am struggling with here is getting the right entry, as I entered at about 1.7 and it drifted and so I exited, of course for it to duly come back in.
Currently I perceive my issue to be waiting for steamers to break out of their range before I back them i.e. I want a 'certain' trade, but am aware that thinking in probabilities is pertinent here also.
Perhaps the help I'm looking for is around the notion of support/resistance, or perhaps having better understanding from a technical analysis POV. Any guidance much appreciated
This was a pretty simple set up for me, odds on favourite with the 2nd favourite priced about 4 and the next runner was around 10 I think. I got on at 1.82, nothing else was being backed so I expected this to come in a long way, its amazing how often these kinds of runners will come all the way in and hit 1.50.
Arbitrage16 if I was you I wouldn't be too hard on myself, you were caught out by the market noise as another poster suggested but in this case the noise was pretty loud. I remember some pretty big money appeared on the lay side and caught my attention, I was ready to dump the position but first I checked to see if one of the horses legs had fallen off, horse looked fine and the 2nd favourite wasnt been backed plus as I said earlier I was thinking that this price could go all the way down to 1.50 so from a risk v reward point of view it was worth hanging on a little longer, I held the position and sure enough it turned and headed nearly all the way to 1.50.
In these scenarios its important to have an idea of how much you're willing to lose and it should never be more than how much you think you could make. Approach your trades lke that and it will be much easier to pull the trigger when you need to.