Triggering stop runs

[Naked shorts]

Anyone had any experience doing this?
How do you know when to do it? and how risky can it be?

(I'm interested in opinions for any market)

 

[tech/a]

Sorry dont understand the question?

 

[chops_a_must]

Sorry dont understand the question?

People deliberately collapsing markets to get a cascade in their direction. Or the opposite of course.

MRC might know of a few people that put a heap of lots into some key support and watched the markets roll over...

 

[tech/a]

Ah I see.

Pretty common if they have enough on the other side of the trade.

 

[chops_a_must]

Yeah, it's pretty noticeable when you watch it.

A lot of short sharp moves, especially through support. Obviously has massive risks on the other side if someone bites back...

 

[MRC & Co]

Obviously has massive risks on the other side if someone bites back...

Yeh, there is definately big risk. Some big institutional prop divisions sometimes try take other traders lots and squeeze them out (since the instos have more risk tolerance). Unfortunately for them, it didn't work too well and they are shutting up shop.

I would say most times people trigger stops are in pauses on a trend, you get sudden, violent sqeueezes the other way, sometimes simply guys wanting to get onto the trend at better prices.

 

[kam75]

I've done it a number of times but not for the purpose to take advantage of short term moves. There's no way of knowing how the market will respond on a break of resistance or support. What you're describing is a ''hope trade''. You're hoping there will be enough buy or sell stops to trigger a sufficient run. Hope trades rarely lead to profits. But like I said before, trading is about consistency. If you can consistently pull money that way, keep doing it!!

regards

 

[Cartman]

Anyone had any experience doing this?
How do you know when to do it? and how risky can it be?

(I'm interested in opinions for any market)

Forex is the best vehicle for this; becoming one of my favorite trades Not always the stops being chased either; smart money punishing the breakout traders will give you some of the best R/R in 1 minute you will ever see

 

[MRC & Co]

What you're describing is a ''hope trade''. You're Hope trades rarely lead to profits. But like I said before, trading is about consistency. If you can consistently pull money that way, keep doing it!!

regards

Every trade is a hope trade, if it was guaranteed, what would be the fun?

 

[Cartman]

Every trade is a hope trade, if it was guaranteed, what would be the fun?

Agree. whats more risky fading a 50 point spike at the end of a cycle that happened in 30 seconds or buying a higher high that took 2 hours to get there i take the fade everytime

 

[MRC & Co]

Sounds like your learning well Cartman

If you want to get on the trend, buy the HL. Fading sudden, sharp movements, is usually a good bet, but takes big ballz, going against natural instincts.

 

[Wysiwyg]

Agree. whats more risky fading a 50 point spike at the end of a cycle that happened in 30 seconds or buying a higher high that took 2 hours to get there i take the fade everytime

Gee, you must sit there fingering your mouse for the whole session.

 

[Cartman]

Sounds like your learning well Cartman

Y thankyou Mirc; i listen to those worth listening to

If you want to get on the trend, buy the HL. Fading sudden, sharp movements, is usually a good bet, but takes big ballz, going against natural instincts.

i hope people just listened to that Mirc

Gee, you must sit there fingering your mouse for the whole session.

my relationship with my mouse is personal Wysi;

seriously though a lot of these moves happen right at the end of a cycle so u dont have to be hanging about all night to pick up a few (on FX) but as Mirc says big ballz can be required and you must have a contingency plan if it goes wrong

 

[Naked shorts]

So is there a way to see where people have their stops?

 

[MRC & Co]

So is there a way to see where people have their stops?

LOL. Is that a joke?

Maybe if your the bucket shop.

If we gap up or down, out of the previous days range, you can bet your bottom dollar there is likely to be stops on the other side of that high/low from the previous day. That's probably the most obvious level I think.

 

[RobinHood]

no.

you have to feel them out. An intimate knowledge of your market, its players and their risk appetite would help -- and the size to move it.

 

[RobinHood]

Some big institutional prop divisions sometimes try take other traders lots and squeeze them out (since the instos have more risk tolerance). Unfortunately for them, it didn't work too well and they are shutting up shop.

They did this in in exchange traded instruments?
Do you know if this is the reason they are shutting shop? -- and not because their losses from other divisions.

 

[Naked shorts]

LOL. Is that a joke?

No, MRC. No it isnt.

If we gap up or down, out of the previous days range, you can bet your bottom dollar there is likely to be stops on the other side of that high/low from the previous day. That's probably the most obvious level I think.

I got the idea for this thread when I saw a run triggered in this fashion the other day. I did well of it too

 

[chops_a_must]

LOL. Is that a joke?

Maybe if your the bucket shop.

If we gap up or down, out of the previous days range, you can bet your bottom dollar there is likely to be stops on the other side of that high/low from the previous day. That's probably the most obvious level I think.

And conversely, you'll usually get strong resistance/ support from these levels as they come back through.

 

[MRC & Co]

Good work Naked, good pick up!

Robin, just know a few prop divisions are shutting down, not profitable at the moment apparently. But one inparticular was doing what I was talking about on the last page.