This is a question for some of the board members like Big Mike, Liquid, GaryD, Fat Tails, (and anyone else really).
If you continuously optimize exit inputs (say a simple profit target and stop loss) for a particular setup....
Is that not essentially the same as incorporating an ATR type function into your profits and stops?
The idea being that if you're swing or trend trading....by continuously optimizing your exits and profit/loss inputs, you're reshaping the strategy to more closely reflect the current or recent past market movements?
I guess the trick would be to determine just what is the appropriate timeframe in order to optimize your results.
An example would be a simple setup that has a static entry criteria (no optimizing for purposes of this discussion) and you optimize based on the last 30 calendar days (21 trading days)......
If at the end of each week, you optimized your strategy settings based on the previous 30 days, then wouldn't that be the same or very similar to incorporating an ATR type approach to your exits?
I saw on one of the threads (I think it was Gary) that indicated his technique for calculating the latest swing/trend ranges on an excel spreadsheet, then shaped his approach accordingly.
I know optimization gets a bad reputation sometimes (when equated with curve fitting).
So what are your thoughts? Is this bad mojo or just smart money management?