The terms below appear as labels on your chart and as inputs inside
True Range Research builds. Each entry gives the general meaning in trading first,
then how the term is used in the software.
TRR LE — Long Entry
On your chart: TRR LE
In trading. A long position is one that is opened by buying,
with the position closed later by selling.
In the software. TRR LE stands for long entry. It
marks the bar on which the build's long conditions were met. It is a mark on a chart. The software places no order,
connects to no broker, and takes no action on your account. Whether the setup is
worth acting on, at what size, and whether to act at all, is your decision and rests
on your own analysis.
TRR SE — Short Entry
On your chart: TRR SE
In trading. A short position is one that is opened by selling,
with the position closed later by buying it back.
In the software. TRR SE stands for short entry. It
marks the bar on which the build's short conditions were met, on the same terms as a
TRR LE mark — an observation, not an instruction.
Short positions carry risks that long positions do not. A short can lose more than
the value of the position, and short equity positions involve borrow availability,
borrow cost, and the possibility of a buy-in. Understand these before shorting
anything.
Stop Loss
Chart label: Stop Loss
In trading. A stop loss is an exit placed at a set distance from
the entry price, on the losing side of the trade. When price reaches that level, the
exit is triggered and the position is closed.
In the software. The distance is set in the build's stop input
— ticks for futures, cents or points for equities — measured from the
entry price. It is fixed for the life of the trade and does not move with price.
A stop becomes a market order the moment it is touched. The price you get can be
worse than the level you set, sometimes much worse, on gaps, news, illiquid
sessions, and fast markets. A stop level states where you intend to exit. It is not
a guaranteed exit price and it does not cap what a trade can cost you.
Trailing Stop
On your chart: Dollar Trailing
In trading. A trailing stop is a stop order whose stop price is
not fixed at a single number. The stop price is set a defined dollar amount or
percentage away from the current market price. As price moves in the trade's favour
the stop price follows it, holding the same distance. When price moves against the
trade the stop price stays where it is, and the order triggers if price reaches it.
The distance is set once; the platform adjusts the level from there.
In the software. The give-back distance is set in the build's
trailing input. The build marks the exit on your chart. It places no order —
if you want a live trailing stop working in the market, you enter it yourself
through your platform, and the order types available to you depend on your broker.
The same execution point as a stop loss applies: the trail level triggers the
exit, it does not fix the price you get. Short-term intraday swings can trigger a
trailing stop on a move that then reverses.
The SEC's Office of Investor Education publishes a
plain-language bulletin on stop, stop-limit, and trailing stop orders:
Stop, Stop-Limit, and Trailing Stop Orders.
It covers stock orders and is published by the SEC, which has no association with
True Range Research.
% Trailing Stop
On your chart: % Trailing Stop
In trading. The percentage form of a trailing stop. The
give-back is expressed as a percentage rather than a fixed dollar amount, so the
distance scales with the size of the move instead of staying constant.
Two different percentages. Brokers usually set the trail as a
percentage of the current market price — a 2% trail on a $50 stock sits $1
away, and widens in dollar terms as the stock rises. TradeStation's built-in
percent trailing works differently: it measures a percentage of the largest open
gain the trade has reached, and exits when that share of the gain has been given
back. On a trade that ran to a $1.00 open gain, a 30% setting exits after $0.30 of
that gain is returned. Same name, different arithmetic. Check which one you are
looking at.
In the software. Builds using the percent method carry
TradeStation's percent trailing label rather than the dollar one. The setting is in
the build's inputs.
Worth understanding. Because the trigger is a share of an open
gain, the trail does not engage until a trade has a gain to give back, and the
distance widens as the trade runs. The amount at stake changes during the trade
rather than staying fixed, which is the opposite of how a fixed stop behaves.
Profit Target
Chart label: Profit Target
In trading. A profit target is a predetermined price level, set
at a fixed distance from the entry price on the winning side of the trade. When
price reaches that level, the exit is triggered and the position is closed.
In the software. The distance is set in the build's target input,
measured from the entry price, and is fixed for the life of the trade.
The name describes where a build exits. It is not a projection, an expectation,
or a statement of what a trade will return. A target is a limit order: price
reaching the level does not guarantee a fill, and price can trade through a level
without filling your order.
How these fit together
A build marks TRR LE or TRR SE when its conditions are
met, and marks
the exit it is set to use — a Stop Loss, a Trailing Stop, a Profit Target, or a
combination. Everything the software does happens on your chart. Execution is yours:
you place the orders, you choose the size, you decide whether to take the setup at all.
These definitions are not advice. Nothing on this page is a
recommendation to buy or sell any security or contract, an offer to effect any
transaction, or advice about which order types, settings, or instruments suit you.
We do not know your financial situation, objectives, or risk tolerance.
Trading involves substantial risk of loss, including possible loss
of principal. Futures, options, and other leveraged instruments carry additional risk
and are not suitable for everyone. No order type removes that risk.
Past performance does not indicate future results. Historical
patterns do not guarantee future results.
Questions about a term or a build's inputs:
support@truerangeresearch.com