Position Trading – How to Monitor a Position

VantagePoint Learning Center

How to Monitor a Position

Welcome to the “How to monitor a position” Learning Session. In this session, we’ll cover how to:

Confirm that the predicted trend direction is going your way
Look for a possible indication to exit your position
Understand the predicted differences and adapt them to your trading style &
Use the Neural Index as a confirmation tool

Learn how to use various indicators to check on your position daily and get a possible indication of when to exit.

There are many different ways to use VantagePoint and it can be adapted to many different trading styles. Here are two possible steps for you to consider when monitoring a position.

Once you’ve taken a position, you may want to check VantagePoint daily to confirm that the predicted trend is still going your way. One way to confirm the trend direction is to take a look at the predicted differences. If the short, medium, and long term differences all continue to point in the same direction as each other, VantagePoint is predicting that the trend may continue to get stronger.

I’m going to view a shorter time frame in VantagePoint so I can see this in more detail.

Please be aware that the Predicted Short Term Difference will be more sensitive to daily changes in price. Therefore, it may have a tendency to be choppy. You could determine whether you want to use this indicator to help you hold or exit a position or whether you may not want to. Conversely, the predicted long term difference is less sensitive to recent changes in price and may be more steady than the predicted short term difference. You may determine to use this indicator to shut out noise in the media and recent market happenings.

The Predicted Medium and Long Term differences will be much smoother when it comes to overall trend direction. This is because the trend line of the short term difference is calculating an average over a shorter period of time and the long term diff is calculating an average over a longer period of time. It’s up to you to decide which combination of the predicted differences works best for you.

Once the predicted differences start to move closer to zero, VantagePoint is indicating that the trend may be slowing down. You can see this on either the chart or the daily report.

For example, here you can see it on the chart.

Now I’ll switch to the daily report, and you can see the values for the predicted differences here. Let’s look at the Predicted Medium Term Difference for November 5th for example. We can see here that the value is changing from more negative number to a less negative number and therefore it is getting closer to zero.

Once you’ve examined the predicted differences, you may want to look at the Neural Index. If this has also changed from 1 to 0 in an uptrend, or 0 to 1 in a down trend as we see here, it may indicate the trend is changing and may be a good time to start looking to take profits or tighten stops.

Try paper trading this for a while first, and then once you get the hang of it, you can try a real trade in the open markets.