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I had one of those too, recently.So I guess you want to know as you may have been there too, huh.OK, Although I think it is unwise to make a carbon copy of me, I 'll give you a little sketch for your education.Yes, it is possible to be caught in a sudden impulse against our open positions sometimes.If that was at scout levels then the response is easy. You figure it out yourself. Its already given in the thread.If it was when we are at rescue mode or attack mode, then a little discomfort is likely, this is the MO. When a counter impulse wave hits, the move are very swift, sharp and directional, normally against our position. If such was in our position I call it windfall profit and I initiate profitaking procedures to regroup for a strong skew attack later. .If such was to my detrement, I call it a @#$% position and I take out the last attack size from the market at a loss, and allow the remaining positions to "bleed".I then would go back to the charts to check if the impulse is "contained" within the scope of the trend. Normally it would have killed the short chart trend and indicated reversal. It would be good to see if this was so , in the hourly charts.Then I scan through the other short charts up to the hourly to find the point where the impulse is not reversal to continue a level up rescue, if it exist.Otherwise, if the hourly chart is impacted the next rescue is 1 level up from the last cut loss size and RESCUE IS IN THE DIRECTION OF THE IMPULSE , this means that the open positions are reversed, as the bleeding stops and built into position as the volatility wanes, normally in such instances, the retraces would hardly be 30 % normally 10%. So the reversal is executed in stages swiftly as the bleeding slows and as soon as the next wave is "felt", the rescue "last+1 level up" is pumped into the market to rescue.Please be aware that this protocol could expose your book up to 30% in the process. therefore do not overstay the rescue. Bring it back to below 10% as soon as the impulse wave slows off , in volitility. Although, the impulse will continue in lesser volitility, it is unwise to carry high exposures, cut back to a smaller spiral , that you may have possibility to mount another attack, if and when it comes, without spiralling the book to oblivion. This is risk management and it is used to supress the "scorpion" ie greed.The increased risk is necessary to turn and recover, but NEVER find excuses to stay at the increased risk level. If you do your next stage, exposes full book. AND if you are wrong, you shall become rogue trader.This is no recommended for newbies and those who have not created for themselves, a foreign capital buffer. For them "bite the bullet , and take the pain."
Then I scan through the other short charts up to the hourly to find the point where the impulse is not reversal to continue a level up rescue, if it exist.Otherwise, if the hourly chart is impacted the next rescue is 1 level up from the last cut loss size and RESCUE IS IN THE DIRECTION OF THE IMPULSE , this means that the open positions are reversed, as the bleeding stops and built into position as the volatility wanes, normally in such instances, the retraces would hardly be 30 % normally 10%. So the reversal is executed in stages swiftly as the bleeding slows and as soon as the next wave is "felt", the rescue "last+1 level up" is pumped into the market to rescue.
Please be aware that this protocol could expose your book up to 30% in the process. therefore do not overstay the rescue. Bring it back to below 10% as soon as the impulse wave slows off , in volitility. Although, the impulse will continue in lesser volitility, it is unwise to carry high exposures, cut back to a smaller spiral , that you may have possibility to mount another attack, if and when it comes, without spiralling the book to oblivion. This is risk management and it is used to supress the "scorpion" ie greed.The increased risk is necessary to turn and recover, but NEVER find excuses to stay at the increased risk level.
