20130117
Long 1 TF 784.5, +0.9
Short 1 TF 785.6, +1.0
Short 1 YM 13507, -4
Short 1 NQ 2744.75, -1.5
Short 1 NQ 2745.25, +2.0
Long 2 NQ 2739.0, 2729.0, -1.0, -1.0
Long 1 TF 884.1, +0.7
Short 1 NQ 2738.5, +2.5
Total YM -4
Total NQ +1.0
Total TF +2.6
When the emotions are running high, it's hard to take multiple contracts. When a signal arrives, you just can't believe you're fading such a strong trend. When taking a breakout, you can't believe the trend will continue for you... But without taking a 2nd or 3rd unit, you can't really capitalize on the trend anyway, you just keep your losses small. It's very hard to capture the trend with a 1-lot that threatens to take back all your initial profits after a push or two in your direction. Nothing is more discouraging than giving it all back. Thus it was for me at the 1st Hour high in the NQ, today. The sell signal was valid, the buying spike stp'd me out initially, and I had to re-enter. With less confidence, I re-entered with only a 1 lot....only to watch the market fall all the way down to the LOD (low-of-day). Make your position size part of your plan. It's alright to step into a 2 or 3 lot position one-at-a-time as the potential turn develops. If it blows through you quickly, you were only in partially. But if it does stall for a few minutes, that gives you the potential to add a 2nd or 3rd and control the stop distance to just beyond the budding pattern, thus keeping the loss small on all units. If the turn fails to develop, or the breakout fails to follow-through, your losses are small. But it does little good to try to capture a trend with a 1-lot. The first lot is taken to pay for the trade, eliminate or reduce the cost of the stp-loss risk on the remaining units, and to ensure you try and walk away with at least something if a larger trend does not develop. There's no trade management or trend management with a 1-lot. There's only luck and good guesses. Have a trade management plan. It's a separate thing from your trade entry plan, which is technical or trade model oriented. Stick to that trade management plan with the same discipline you use with your trade entry plan. The plan will give you the flexibility you need to capture larger pieces of the trend.
