A while ago I had a week FILLED with epiphanies pertaining to trading techniques. It started off with a trade that lost over 100 pips. Rather than just accepting my loss I studied it in depth. To make what really is an interesting story short (though it is a cool story I don’t think it’ll significantly add much to you, and I don’t feel like writing pages of text recounting it all) I’ll simply say that I went on a mental adventure by discussing that trade with several people, clarified my thoughts with a couple pitchers of beer, and pondered at depth the significance of what I learned from that ONE losing trade. Folks, I can’t stress it enough to you how beneficial it is to keep your head in charts and ponder trading because that is how you come up with some truly clever ideas for your trading (how do you think I came up with most of the stuff I talk about?). This is especially true after loosing trades – “there is no such thing as a failure (or a loss) if you’ve learned something from it” (that week I
sure got my money’s worth – use this philosophy when you experience a
significant loss too, that’s why I’m telling you about all this fluff stuff). This
chapter will elaborate upon just one of the many concepts that I came up with
that week. The concept isn’t unique I’m sure (actually it is not unique, but
nobody told me about it – some of you “expert” traders will likely think
nothing of it), but I’ve never been taught or heard about it, and so chances are
that this will be a new idea for you too.
I had a beer with a friend arguing over the stupidity of trading without a stop
loss set for ALL trades. He was making arguments that supported trading
without stops (in my opinion they were invalid) while I kept pointing out the
folly of that idea. Several hours later I realized that trading without stops
(since he got me thinking about the subject) could in fact be a solution to one
of the trading problems I had been pondering about how to solve for some
time. I immediately back tested the idea, tried it live successfully, and have
now added it as a part of my trading toolbox. I call this technique the “Netless
Straddle” Technique and yes it involves trading without a stop loss! Yeah I
know I keep shouting loudly to never trade without a stop, but as the cliché
goes, “never say never”, because now I’ll have to eat my own words and say
that there is one logical technique for trading without a stop loss set… and
here it is.
This idea has progressed through several evolutions (getting better each time),
and has spawned several variations, which you’ll learn shortly.
“Netless Straddle Trading” isn’t really a trading “Opportunity” but rather is a
trading tool to be used in conjunction with certain types of
“Opportunities”. I’ve put this here, before dealing with the “Opportunities”
presented in this eBook because this concept will be useful for a couple of
situations that will soon be explained.
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