Spreads and trade / money management

[chris2var]

Hi, can someone please explain the following for me? I’ve always had some difficulty figuring out the spreads, but previously I’ve been using 4 hours and above so pretty much ignored them! Now with looking at this AIMS 1 minute trading I’ve have to get my head around them. I’ve assumed a spread of 2 pips for my questions below. So with that out the way I’ve included below Grant’s trade management (in red) with my questions in black.

1. Initial disaster SL 13 pips
Is this a max pip loss including the spread, which would be 11 pips of chart movement?

2. Move SL to High/ low of trigger candle +/- 3 pips
If I’m in a Sell trade and have stop +3 on high of entry candle then the buy /ask price would be +1 of candle high (ie 1 pip against the candle high and I’m out).
Whereas if I’m in a Buy trade and have stop -3 on low of entry candle then the sell/bid price is -3 of candle low (ie 3 pips against the candle low and I’m out).
I suppose what I’m getting at is what is the “real” safety stop loss?
Is it 1 which would be:
For a sell trade +3 on a candle high
For a buy trade -1 on a candle low
If it was 3 then it would be:
For a sell trade +5 on a candle high
For a buy trade -3 on a candle low

3. At +5 pips move SL to -4
Again is this a max pip loss including the spread?

4. Trail AIMS or 5 consecutive colour candles +/- 3 pips
Question as for (2) above

5. Watch for obvious stalling PA/candle patterns whilst in trade.
No pips mentioned here so I’m fine with this!

At present I’m assuming for (1) and (3) it is maximum loss but I’ve not a clue for (2) and(4)

Thanks ....
Chris

[immy]

Hi, can someone please explain the following for me? I’ve always had some difficulty figuring out the spreads, but previously I’ve been using 4 hours and above so pretty much ignored them! Now with looking at this AIMS 1 minute trading I’ve have to get my head around them. I’ve assumed a spread of 2 pips for my questions below. So with that out the way I’ve included below Grant’s trade management (in red) with my questions in black.

1. Initial disaster SL 13 pips
Is this a max pip loss including the spread, which would be 11 pips of chart movement?

2. Move SL to High/ low of trigger candle +/- 3 pips
If I’m in a Sell trade and have stop +3 on high of entry candle then the buy /ask price would be +1 of candle high (ie 1 pip against the candle high and I’m out).
Whereas if I’m in a Buy trade and have stop -3 on low of entry candle then the sell/bid price is -3 of candle low (ie 3 pips against the candle low and I’m out).
I suppose what I’m getting at is what is the “real” safety stop loss?
Is it 1 which would be:
For a sell trade +3 on a candle high
For a buy trade -1 on a candle low
If it was 3 then it would be:
For a sell trade +5 on a candle high
For a buy trade -3 on a candle low

3. At +5 pips move SL to -4
Again is this a max pip loss including the spread?

4. Trail AIMS or 5 consecutive colour candles +/- 3 pips
Question as for (2) above

5. Watch for obvious stalling PA/candle patterns whilst in trade.
No pips mentioned here so I’m fine with this!

At present I’m assuming for (1) and (3) it is maximum loss but I’ve not a clue for (2) and(4)

Thanks ....
Chris

Hi

I'll let the big man himself answer this! If not i'm always here (hug)

cheers

[Grant]

Hi Chris.

to answer you questions :

1 & 3. Both include the spread

2 & 4. I decided on 3 pips (which includes the spread) on both longs and shorts because i wanted to see both the bid and the ask price above or below the candle being trailed or both outside the aims level being trailed by 1 pip. Hence 1 pip + spread is 3 pips buffer.

As for what is a safety SL, it is down to the individual trader to determine what his/her tolerences are when placing the SL.... I like the 3 pips buffer as i explained above..

5 BY obvious candle patterns i mean inside bars or hammers etc, if any of these appear and i have good profit then i will move SL down as if trailing that candle, so +/- 3 pips on the high or low.

Like i said above this is how i do it, is it always correct, i wish it was, but it was only published as a guideline so that the members could have a good basic trade management model to then tweak/change to their own style of trading.

hope this helps

Grant

[chris2var]

Hi Grant

Thanks for the reply, I think I've got it now. I did think (1) and(3) would include the spread.
From what you explained I now understand what you are doing with (2) and (4) by using 3 pips it doesn't matter if its a buy or a sell, its clear of the entry candle / trailing candles either by 1 pip if it was a sell trade or by 3 pips if it was a buy trade this because we see the sell/ bid chart/ prices).

I have to start somewhere and with all the praise for your trade management ^:)^ that seems the ideal place to start from.

Thanks again
Chris