Thursday, October 29, 2009

Further Refinements, and thoughts on long PC day

It occurred to me i don't have a contingency planned for when my down day pc play (DDPP) starts to work but then there is a late day reversal.  So here it is.  Once it starts to work, if it dips back above the MA, my exit is 4.5 points away from the initial touch of the MA, or my original stop loss exit, whichever is closer.  That should hopefully be a good one.

Today was a great PC day on the long side.  If i had tried to apply the DDPP rules to it, but reversed for an up day, i wouldn't have gotten in at all because there never was a sufficient pullback in the market.  It got me thinking that i had seen a lot of up PC days that never had a decent pullback but closed by their highs.  That would be a classic trend day.  I'm not sure if this is because up days are always like this, or the bull market that we find ourselves in,but that seems to be the case.  I'm going to look into it further in order to come up with a good UDPP setup rule list, but in the meantime, i am inclined to think it will have to buy it at a worse relative price, all the while keeping a sufficiently far stop.  So it would be riskier, but could still be quite profitable.  I will revisit this soon.


1 comment:

  1. Yampo I don't know if there will be much difference but if you are using the 13SMA try throwing the 20EMA on and seeing if that limits the risk without eliminating the trade..

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