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Technical Indicators as "exit" points?

Hey guys.

So I've become really confident in my ability to determine an entrance point for the method of trading I would like to do.

That being said, I'm realizing now my 'exit' point is not good.

What I am looking for is a good indicator to determine an exit point. My strategy is primarily 'swing,' and I've figured out how to time market ups pretty quickly. That being said, my 'exit' point is ... something I'd like to discover and improve upon.

Any suggestions for indicators, settings, or crossovers that are good for identifying the turn-around and exit point?

Thank you!

Best Answer

  • BobVBobV
    Accepted Answer
    All I can suggest is to chart the indicator yourself. See what price has to do to cause the indicator to give you a signal.

    The other thing I have found useful in developing a method is to try and find all the cases where signal didn't work. If you can only find a few then you may have an exploitable edge.

    Develope a plan. When this happens I do this. My exits both stop loss and profit targets will be triggered when this happens. Back test and forward test before you go live.

    Good Luck!!

Answers

  • My favorite exit indicator is Vortex topping out at 1.2, sometimes Vortex will continue rising but by exiting at the recommended 1.2 your profits are protected
  • I should have said VORTEX PLUS, sorry
  • What is your time frame for a swing trade?

    I swing trade (2 days to a month).
    I determine my target prior to initiating my trade.
    If the price action leads me to believe that my target wil be exceeded I may use a trailing stop.
    For what it is worth I find that closing trades at the predetermined target has worked out the best and takes the emotion out of the equasion.
  • cathoduzzcathoduzz
    edited July 2014
    Hey guys -

    Thanks for all of your responses. Well I started messing around with some inputs -

    and basically I have found my 'short' indicator (for instance an enter/exit SS crossover of 5,3 or something... sorry I don't feel entirely comfortable saying it) is great when used in conjunction with a long indicator.

    I have found a great long indicator, that being a TSI 21,8,5 ... but it would be nice if it was a little bit tighter. I just don't know how to make it tighter.

    So basically my methodology is this:

    IF TSI (21,8,5) has had a bullish crossover, (so indicator is currently bullish)
    AND my fast indicator (Slow Stochastics 5,3) has a bullish crossover,

    Purchase stock @ Slow Stochastics bullish crossover, set trendline-stop loss, or exit once Slow Stochastics has triggered a bearish crossover.

    ______________________________

    So, working along the lines of TSI (True Strength Index)21,8,5 -

    Is there a way I can make this a bit tighter? I am currently using it to gauge Index directions, and I really like it. It's still a little bit... large though, I took these inputs from a PublicCharts listing, it would be nice if they were a bit tighter - OR if there was another indicator with your recommended inputs that acted similarly that was a bit tighter For example; Trix 15.9, PMO 21,13,8, etc.

    Thank you!

    _____________

    EDIT: 7/15/2014 9:30 PST

    Lambchop: What are your inputs on the Vortex Indicator for this?

    Bobv: Thank you for your response. I have tried this methodology but I am not content with how well I sleep at night and how much effort I need to put into it to do it that way. I am sure in time I can narrow down my screening time etc., but right now I have to go through so many lists. I'm trying to stick to a few stocks and work from there... and basically just keep it really, really clear for myself (so I can sleep, haha). Clearly you've made this work for yourself, though - which is really impressive. If you have any suggestions for my TSI comment above, I would greatly appreciate your wisdom. Thank you.

  • ATTEMPTED EDIT: 7/15/2014 10:30 PST


    HOLY SHOOT! Just realized I was totally focused on something else when writing in response to your responses. I hope this made sense. Super sorry, guys. What I am looking for is a good "bull on, bull off" indicator to execute my faster indicator (Referenced as Slow Stochastics 5,3) within. Thanks guys.

  • Cathoduzz,

    Re: TSI

    Re: True Strength Index 4 7 with accuracy as to when to get in and when to get out.

    If you want to enter a stock right out of the starting gate the Freestockcharts dot com charts will provide you with the answers as well as the scanning tools at the bottom. The best places to use is the CNBC IQ-100 index, barchart.com with the top 100 stocks, and with the top 100 ETFs, https://www.barchart.com/etfs-funds/etf-monitor as separate blocks. The money makers are the U.S. Industries (the XL's)

    Freestockcharts.com setup panels. It is FREE to use.

    The third panel True Strength Index 4 (short period) 7 (long period) is what I use. I believe the default is 3 9.

    The third panel has the TSI 4 7 with a green thin line at the zero line. and a dotted white line at the 0.25 point. It is just a warning line for signals heading south. I have tried to incorporate the 0.25 but it still hasn't worked yet. Trying to figure it out as a separate scan to find stocks that hit the 0.25 line heading south. No luck so far.

    Panel one has the OHLC lines, I don't like to use Candle stix. The OHLC lines is much faster read for me in 300 nanoseconds. FW moving average 20 (pinkish line) is incorporated.

    Panel two is the Volume shrunk down a little.

    Bottom line. Buy when the yellow line crosses up heading north and over the 0.00 line (green), take the profits per the business plan or ride it out when the yellow line crosses back down over the Zero (0) line. That simple. Only get minor speed bumps for a few bux.

    - - - - - - - - - - - -
    Scan 22A - Daily True Strength Index 4 7 over 0 North

    [type = stock] AND [COUNTRY = US]
    //and [SCTR > 90]
    and [TSI (4,7) crosses 0]
    AND [Daily Volume > 500000]
    AND [Daily Close > 10]

    - - - - - - - - - - - - -
    Scan 22AA - Daily True Strength Index 4 7 over 0 South

    [type = stock] AND [COUNTRY = US]
    //and [SCTR > 90]
    and [0 crosses TSI (4,7)]
    AND [Daily Volume > 500000]
    AND [Daily Close > 10]

    - - - - - - - - - - - - - -
    Scan 24 - WEEKLY True Strength Index 4 7 over 0 North

    [type = stock] AND [COUNTRY = US]
    //and [SCTR > 90]
    and [weekly TSI (4,7) crosses 0]
    AND [Daily Volume > 500000]
    AND [Daily Close > 10]

    - - - - - - - - - - - - - -
    Scan 24A - Weekly True Strength Index 4 7 over 0 South

    [type = stock] AND [COUNTRY = US]
    //and [SCTR > 90]
    and [0 crosses weekly TSI (4,7)]
    AND [Daily Volume > 500000]
    AND [Daily Close > 10]

    - - - - - -- - - - - - - -

    For monthlies heading North or South, change the werd Daily to Monthly

    Hope this will help.

    Quill -
  • Just my 2 cents as well...

    I find that swing trading is best done with a time frame target instead of a price target (except in the extreme cases where a stock makes a major move in your favor, which I will usually take the money and run). I will hold for about 3 to 5 days.

    I still have a stop loss (usually around 4% of the entry price), but I want to see movement in the next 3 days. I have rules that will force me out of a stock (for either inactivity or move against me), but will stay in for 5 days if it is steadily increasing. After 5 days, stocks tend to give some of the funds back, and I would rather be on the next wave up.
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