trailing stop question - equities

billpritjr · Post by **billpritjr** » Mon May 31, 2004 2:39 pm

Wanted to put this out to audience

For those of you who trade stocks, how are you deciding your trailing stops?

ATR ? As in 2 times ATR, etc

A short term MA?

price channels/N-day breakdown?

Gut feel?

thanks

PeterK · Post by **PeterK** » Tue Jun 01, 2004 8:07 am

For swing trading of 2-3 days, I use whichever of (yesterdays Low) or (yesterdays' close - 25% of ATR(20)) is the greater (for Long trades).

For medium term or longer systems, I generally use a similar mechanism with the ATR factor being larger, and/or an ATR multiple calculated from the highest high during the trade.

Peter

Gherkin · Post by **Gherkin** » Mon Jul 12, 2004 4:07 am

I am working on the same thing and finding mixed results. I am trading trends in stocks buying options as my vehicle for leverage. Parabolics are too short and even 2 ATR's can be too big... Grrrr!!! I have been looking at an initial tight stop (0.5 ATR) and then moving to 2 ATR once it's moved 2 ATR's from the THEORETICAL entry price. i.e. sometimes if it gaps above my entry I still gotta take the trade, but my risk is larger. In short, I think a combo is gonna be the right mix, but I'm open to almost any idea.