Iron Butterfly With Stops Seems Nearly Impossible

#1

I have been trying to find success using iron butterflies with stops to keep the risk around $4 - $10 . I put the trades on during the Asian session for next day expiry at 11am. I have been following the rules…but some how I have not had one single day where I don’t get stopped out of at least one trade. I’m literally loosing money slowly. It’s been about 5 days total that I have been trying this and I have yet to come across a day where both trades won. Any suggestions as to what I should do? And has anybody else had this issue before?

#2

I don’t know a single sole who has tried to keep risk around $4.00 to $10.00 your stops are to tight your going to get stopped out constantly. What led you to believe this would be a successful method or trading system?

We do not teach this at all.

#3

Hey Darrell, I actually watch this video…https://www.youtube.com/watch?v=9q3Tvgg4DrM

He talks about using stops so you can limit the risk to $4. I believe he actually stated this himself. I could be misinterpreting this.

#4

He means if you exit both sides when the strike is hit. Not a $4.00 move against you exit.

ie one side profits the other side looses the the strike is hit risk can be very low.

#5

that’s what I meant. When I say I get stopped out, i mean i get stopped out when the price reaches my strike level. I know he doesn’t mean to exit at -$4… It seems like every time I set these up, I get stopped out almost every single time.

#6

Im not sure what strikes y our choosing. Are you using expected ranges or just randomely picking based on price or?

#7

What I do is choose two strikes that are not quite at a good price level, and are above resistance & below support. Make sure these strikes are pretty wide, and MARK them on your chart. If one of them gets to a good price (market will have to move toward that strike to get a good price) just get in on that side. Wait for the market to turn around toward the other strike & ONLY get in if it gives you a good price on the other side. With this strategy, you only have to worry about one side initially. If you do get in on both sides, your strikes are farther apart, so it’s easier to win. If you don’t get good prices at either strike, you simply do not get in!

#8

It is helpful to use the Expected Ranges to know the expected move of the market for your timeframe to help chose good strike levels as well

#9

This is basically a requirement if you want to pick good strikes as every hour of every day of the week has a different expected movement. Expected ranges help you identify these expected movements and expected close to closes as well.

#10

One of the big errors I see being made that no one is mentioning is choosing the 11am expiry, your trading a strategy that is for flat markets unless you are doing one sided premium collection in a trend, granted your doing it over asia session which is slow usually BUT you are also trading over london open and the worst of all the london NY overlap the most active part of the day, thats why your getting stopped out every time.Trading Session CLICK HERE

#11

Hey Darrel, New to Apex, your site is great by the way. There is a video on Apex called Iron Butterfly setups with stops. He talks about using the stop trigger to set the indicative 1 tick above/below your sell/ buy order to get out at $50.00 when you paid $75.00, losing $25.00 on one side but gaining $25.00 on the other for basically a break even trade…Exchange fees would be $4.00…could you explain exactly how to do that or where I can find out the step by step way to execute this trade? He doesn’t really explain why the one or two ticks sets it at getting out at $50.00, but it seems to work…this strategy is one I will use during low volatility periods like after lunch, with commodities and indices, wherever I can get that 25/75 75/25 setup, and the best tick spread. Also, and again a newbie, the scanner is awesome, but why is it that when you sell for example at $25.00, the ticket says max profit at like $15.00 less? If you could respond at you earliest convenience it would be appreciated and thanks so much,Mark Baez

#12

Mark if you could send a screenshot of what you are reffing to to the Help desk. If you sell for $25 your max profit is $25, it should not ever show less than that.

#13

If the market is above the strike your buying it will cost more than 50 when the underlying market indicative hits the strike then the binary will be valued at approximately 50. Simply buy the lower binary and sell the upper binary and then on the scanner open 2 tickets select stop trigger (going opposite direction) and set trigger of exiting when the strike price is hit by the indicative. Demo it it will make sense pretty quick. We also have a course on how to use the stop trigger that would help.