Entries Are Not That Important?

You may come across a belief that says entries are not that important, but exits are. The supporter of this belief says that when a market enjoyed a strong trend, the entry on such a large move is irrelevant. It is the exit that is important to ensure the trader captures most of the trend. In hindsight, we can understand that, but that is with hindsight. Usually these people talking with the benefit of showing a picture-perfect chart, which has already enjoyed a strong trend.

In my opinion, entries are very important. They directly define our stop placement, initial risk, and potential loss. The size of our losses, compared to our wins, directly affects our expectancy!

When we enter a trade, we have no idea whether the trade will enjoy a strong trend; we have no foresight; we have no crystal ball. We only have the now. And the now is all about controlling risk and trading for the opportunity to earn expectancy. In addition, since entries define initial risk, they also directly affect money management strategy for position sizing.


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