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Limiting Losses – Initial stop losses – We run it tight

Questions › Category: Questions › Limiting Losses – Initial stop losses – We run it tight
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John Reiter asked 5 years ago

Hi Pat, New VIP here.  Love your service.    I wanted to ask to see if you could offer an initial technical stop loss price, based on the chart pattern…   along side the buy points you offer…. to every key list stock that goes out nightly.     

I know Bill O’Neil’s rule was 7% and is that what’s you use?  Or do you get out sooner?   

I subscribe to the IBD Live service and Chris Gessel and Mike Webster are often saying that “for this stock, you could get out earlier if it undercuts the bottom of this bar (using daily charts) instead of waiting for the 7%”   

Is the initial stop something you could point out for us and list every night, or should we add that to your spreadsheet ourselves….    this a lot of your members may have different ideas on this topic?   

thanks for all your help! 

john 

 

 

 

 

2 Answers
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Avatar photoOwen Staff answered 5 years ago

Hi John,

Pat made this video for you:

https://youtu.be/8Ru-VHYOwzY

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Avatar photoOwen Staff answered 5 years ago
What Pat didn't say in the video is that he wants everyone to learn to set their own stop losses. While some folks may be comfortable under low-of-day, other's might want to set a dollar limit loss. I know we won't attempt to place stop losses in the Key List each evening. We've spent enough time in other trading rooms and auditing other services to know that listed stop levels get dismissed very quickly based upon the actual entry point and the market action. All that said, please feel free to ask Pat in the Twitter feed about stop placement after a trade is filled. He'll be happy to help identify some key levels.
John Reiter replied 5 years ago

Got it, thank you Owen! Yes, within IBD Live there are several different attitudes on this topic. But I am relatively new and it’s confusing with so many different ways of doing it. But what you and Pat said makes a lot of sense and I appreciate it. Have a great day!