Forex

Of all the day-trading systems I've tested over the years, 90% of
them trade the S&P 500. This is the market of choice for most
day-traders because it affords enough potential to make it a
worthwhile venture By definition,day-trading means you exit at the end of the day, so your profits
must at least cover your commissions and slippage.
Although a key difference with the S&P systems I've tested is their
approach to entering the market -- they have ranged from basic breakout systems to
systems based on the phases of the moon -- the exit signals usually fall into four
categories: protective stop, profit target, trailing stop and, of course, market on close.
Many of the systems use a combination of these exits.
Because the exit technique is as much or more important than the entry in day-trading the
S&P 500, I'll demonstrate that different types of exits work with various types of systems.
Over the past eight years I've often been asked which exit technique is the best. The
answer is it depends on the system; there is no black or white answer. However, through
research, I've found the success of these exit techniques usually depends upon the
frequency of trades a system generates: More frequent trading systems need tighter exits
whereas less frequent trading systems need looser exits.