I started a comment to point out that keltner channel stops are the same as ATR stops.
But I did some digging first and realized / remembered that Keltner bands are based on an n*ATR distance away from the EMA, and not based on a distance away from price. It’s not the same, and it’s reasonable that Keltner stops would outperform ATR stops.
Time to rethink my appreciation for Keltner channels.
One thing you may want to study is how algorithms come and take your stops. A very common algorithm is the “search and destroy “ algorithm You will see this very often in emini futures. The market will be going in your direction, it will suddenly reverse come and take your stop and then resume going in the right direction. Very aggravating eh? I see this a lot now in $SPY too since they introduced 0DTE options. The tighter your stop the more likely that algorithm will come and take it. This is because when you place your stop loss order you are broadcasting it to those algo bastards. Depending on your size it sometimes makes sense to place the stop as an “iceberg “ order if your broker offers this feature. Good article! Best of luck with your trading.
I started a comment to point out that keltner channel stops are the same as ATR stops.
But I did some digging first and realized / remembered that Keltner bands are based on an n*ATR distance away from the EMA, and not based on a distance away from price. It’s not the same, and it’s reasonable that Keltner stops would outperform ATR stops.
Time to rethink my appreciation for Keltner channels.
Thanks for sharing.
So what does that pic of a nude woman have to do with stop losses? Who you spend your money on? Join the club.
I was going for a goddess gifting you a divine shield to protect you against the markets, but sure your interpretation works too lol.
Well I am looking for one in a million.
So your interpretation works well also.
One thing you may want to study is how algorithms come and take your stops. A very common algorithm is the “search and destroy “ algorithm You will see this very often in emini futures. The market will be going in your direction, it will suddenly reverse come and take your stop and then resume going in the right direction. Very aggravating eh? I see this a lot now in $SPY too since they introduced 0DTE options. The tighter your stop the more likely that algorithm will come and take it. This is because when you place your stop loss order you are broadcasting it to those algo bastards. Depending on your size it sometimes makes sense to place the stop as an “iceberg “ order if your broker offers this feature. Good article! Best of luck with your trading.