Using conditional trading... should I?

[shyguy]

I am fairly new to the game... but am trading as an end of day trader... only trading uptrends (not looking at CFDs at this stage).

the books i have read suggest setting a stop loss...

so my questions are:

1- can i just review the shares at EOD or should i set a stop loss... im assuming i should... or at least it makes sense that it is safer to do so if places wisely...

2- should i also set a conditional sell when i think it is getting to a peak?

3- lastly... in commsec when i go to the conditional trading section it just gives me info about it but wont let me set one...? i also read that according to commsec they cant guarantee it will always be excuted...!?

 

[tech/a]

I always trade with Conditional orders.
I use Bracket orders with IB.
Cant help you with comsec

I set a stop limit and a Sell limit.
I will move the orders but ONLY up.

If a trade sets another significant pivot low then ill move the stop up.
If a trade retraces and then moves on quickly towards a resistance area Ill adjust the sell stop well above the resistance area.

If a trade FLY'S Ill definitely move the stop way up under panic buying (in a small cap----say after a 20% run Ill then look at following it up in the same day.).

There is much you can do with conditional orders from set and forget to working your trade.

 

[skyQuake]

I always trade with Conditional orders.
I use Bracket orders with IB.
Cant help you with comsec

I set a stop limit and a Sell limit.
I will move the orders but ONLY up.

If a trade sets another significant pivot low then ill move the stop up.
If a trade retraces and then moves on quickly towards a resistance area Ill adjust the sell stop well above the resistance area.

If a trade FLY'S Ill definitely move the stop way up under panic buying (in a small cap----say after a 20% run Ill then look at following it up in the same day.).

There is much you can do with conditional orders from set and forget to working your trade.

Commsux makes u pay $$ for conditional orders. With nearly 1/10 of the functionality and flexibility.

 

[shyguy]

i was reading through the questionaire tht you have to do before Commsec will activated conditional trading (triggers)...

with all of the comments stating that they cant guarantee the trigger will be triggered etc. etc. is it really worth it to use triggers in commsec? or is it more of risk to do so...?

are all places like this with regards to conditional trading? ie the "cant guarantee this and that"...

 

[Gunslinger]

Have a look at PDN on 20110121.
Open: 5.4
High: 5.43
Low: 4.98
Close: 5.04

I'd set a stop loss at 5.31, this was fired in the preopen and executed at 5.33, if I'd not had the stop in place I'd have lost another 29 cents.

I've now opened an account with a broker who doesn't charge extra for conditional orders

It also makes it much easier for me to have a automatically sold to cut losses rather than my fickle mind which is much more inclined to hold on in the hope it comes back.

Cheers,
JB

 

[tech/a]

i was reading through the questionaire tht you have to do before Commsec will activated conditional trading (triggers)...

with all of the comments stating that they cant guarantee the trigger will be triggered etc. etc. is it really worth it to use triggers in commsec? or is it more of risk to do so...?

are all places like this with regards to conditional trading? ie the "cant guarantee this and that"...

I doubt it would be too often you wont be sold.
I use stop limit and if its likely to be fast moving set a few cent spread.
If youve got the $$s just use IB
I think the minimum to open an account is $15k.

The best trading platform Ive ever seen.
Can trade anything in the world.

 

[toocool]

I doubt it would be too often you wont be sold.
I use stop limit and if its likely to be fast moving set a few cent spread.
If youve got the $$s just use IB
I think the minimum to open an account is $15k.

The best trading platform Ive ever seen.
Can trade anything in the world.

I agree tech

After moving towards break out trading during the course of last year being with comsec wasnt ideal, $19 a trade plus $15 conditonal orders each way and only after owning the underlying.

I moved to IB reg t margin account in December minimum was 10k US .. so now is a good time to sign up lol

love it.

 

[skivvy]

Can someone tell me what IB is referring to as a conditional order broker?

 

[pixel]

I stopped issuing conditional orders years ago.
That was when I heard one broker brag how they had raided the stop orders - which they knew from their order book where they were. All it took was a few strategic sell orders down to the first conditional sale, then watch the avalanche cascade to the bottom.

One particular onliner was rumoured to be "very good at that"...
so now I watch my holdings, and when I notice some of the telltale signs that something fishy is going on - buy side depleted is usually the first visual signal - I try and get a buy order ready at obvious support.

As regards my "conditional" orders - I know where I want to stop out. If "regular" selling tells me it's time, I get out. But in most cases, my trailing stops have the condition "on Close Below..." Closing prices are usually more reliable because "Amateurs open the sessions, Professionals close them."

Now you'll ask "How does that help me? I can only trade eod..."
Good question. With very few exceptions, a share will give you a chance to exit at the previous day's Closing price. Even if it gaps down early, that gap will be closed; therefore it is still possible to place a sell order one tick below the Close where you intended to stop out. If the next day opens at an overlap, you get a little more in the opening auction - you gain. If it gaps down, chances are your sell order gets taken out as the gap is closed and you may sell a pip below optimum.
Some gap-downs you'll lose more, OK. But you have to remember, it's a compromise; your reward is you don't have to sit slave-like in front of your screen all day.

 

[shyguy]

Pixel thanks for the lengthy response and others who contributed!...

for the most part i understood everything... i think...

so i decided not to use the conditional orders and just track it by EOD for the following day...

my question now is when i decide i am getting ready to sell am i better off using a conditional order to try and maximise my gain ie. try to sell at 5 otherwise sell at a min of 3... (rising sell)... as apposed to just setting a standard sell price...?

 

[tech/a]

I stopped issuing conditional orders years ago.
That was when I heard one broker brag how they had raided the stop orders - which they knew from their order book where they were. All it took was a few strategic sell orders down to the first conditional sale, then watch the avalanche cascade to the bottom.

One particular onliner was rumoured to be "very good at that"...
so now I watch my holdings, and when I notice some of the telltale signs that something fishy is going on - buy side depleted is usually the first visual signal - I try and get a buy order ready at obvious support.

As regards my "conditional" orders - I know where I want to stop out. If "regular" selling tells me it's time, I get out. But in most cases, my trailing stops have the condition "on Close Below..." Closing prices are usually more reliable because "Amateurs open the sessions, Professionals close them."

Now you'll ask "How does that help me? I can only trade eod..."
Good question. With very few exceptions, a share will give you a chance to exit at the previous day's Closing price. Even if it gaps down early, that gap will be closed; therefore it is still possible to place a sell order one tick below the Close where you intended to stop out. If the next day opens at an overlap, you get a little more in the opening auction - you gain. If it gaps down, chances are your sell order gets taken out as the gap is closed and you may sell a pip below optimum.
Some gap-downs you'll lose more, OK. But you have to remember, it's a compromise; your reward is you don't have to sit slave-like in front of your screen all day.

Can you tell me what benefit a broker has in Selling a stock down to take out stops?
Unless he is trading the Stock and buys at the selling of the stop orders which if proven would land him in Jail!! Revoke his licence and basically ruin him.

With over 2000 stocks how does he take care of all of them at all levels???
Sounds like an urban myth to me.

"Amateurs open the sessions, Professionals close them."

Another urban myth Ive never seen proven.

 

[shyguy]

so i decided not to use the conditional orders and just track it by EOD for the following day...

my question now is when i decide i am getting ready to sell am i better off using a conditional order to try and maximise my gain ie. try to sell at 5 otherwise sell at a min of 3... (rising sell)... as apposed to just setting a standard sell price...?