Trade Entry/Exit - Dollar Cost Averaging

[alkuqvdgzzqk]

Hello All,

In another thread (Early Stage 2 Weinstein's candidate)

https://forum.incrediblecharts.com/messages/316907/769746.html#POST183603

A discussion spawned about how one might go about trading breakouts given the low percentage of breakouts that ultimately lead to strong stage 2 growth trends.

Rather that distract that thread from its Weinstein discussion I am answering a question here posed to me by shadetreetrader regarding scaling entries & exits.

[AllanGon]

Clearly any dollar cost averaging approach has increased costs re Brokerage.

But to my mind it does help manage risk, and risk adjusted returns are what I seek.

No system is perfect, and what I currently do isn't either.
(I continue to do back-testing etc., and the system gives me some confidence - but often times find backtesting can lead me into analysis paralysis with Betas, Sharpe Ratios and the like!).

When things go against me, I have typically not spent the dollars on additional brokerage, so under those scenarios the trade is akin to a simple entry/exit at 1/4 the desired position.

I hope this helps some folks, and I can add no more to give insights as there is nothing more material to add!

Please feel free to add your experiences with respect to how you manage breakout entry / exits so that we an all learn

Best Wishes to all.

[alissa17Cam]

So this is not about a full Trading System discussion, rather a component of it.

FWIW I have an approach synthesised from Elder Triple Screen and others, and as said elsewhere I am not a short term player (Intermediate to Long term). That said I continue to try to learn and experiment to see if I can make money in shorter terms, but (honestly) for the most part my temperament is probably not suited to those time scales.

Here is a Weekly Chart that shows an open trade in my attempt to amplify what I have already written, which is not that complex.

[AlleneEvaky]

At the end of the day I entered I was happy to see another strong Elder Impulse signal (on the daily).

The stock then churned up and down, but I was comfortable with where the S/L had trailed to -- I got nervous on the big down in the week of 4/11, but the stop was not hit. Began to breathe easier when I saw the big green candle of the following week. Almost an "Engulfing Bull" Candle, which indicates plenty of gas left in the tank.

In the week of 18/11 I got a signal that I could consider taking some partial profits, but given my analysis on the re-rating of NAB I chose not to, this was always going to be a long term play. (There are some discretionary elements to my system).

So I added to the position on 21/11 given I also saw another strong Elder Impulse indication on 17/11.

The stock continued to rally, and then retraced in early Jan 2017, respecting its 12Wk EMA. And when I saw the MACD (on the daily) separating again from its signal line, and given the weekly had respected its EMA, I added a final parcel to the position.

So as of 13/2/2017 I have a fully loaded position on this stock.

An extract from some tracking spreadsheets is below, given the the questions posed were (a) how I go about it and (b) surely brokerage consumes profits.