Since confidence will crash you faster than anything else, doing whatever makes you the most comfortable will be the best.
With that said the physics of perfromance riding a motorcycle don't change just because your confidence does. The lower you can get the center of gravity the less lean angle you will need to counter act the leveraging forces of centrifugal force trying to throw you off the road.
By keeping your weight on the pegs and hanging off you are lowering that center of gravity and giving it less leverage on your motorcycle, therefore less lean angle is required. It also depends on the corners your taking, sometimes shifting your body from left to right for quick transitions can upset the suspension and your two preciously small contact patches. So you must practice and get comfortable with when it should be used and when it shouldn't be.
Dragging a knee does several things:
1. inside knee hanging out creates wind drag on the turn in side which facilitates an easier turn.
2. getting off and down low lowers center of gravity for the bike/rider.
3. dragging your knee gives you a gauge of how far your bike is leaned over
4. being closer to the ground mentally/emotionally feels safer. Sounds odd but it's true, at least for me. It has something to do with your mind thinking if I fall from way up here on the saddle going this fast I will bounce. If I fall being this close to the ground already I will slide.
Get on a track and practice these skills even if you don't want to become a racer. It will help you understand how they all fit together in a safe environment. Remember the track is a drug and can hook you quick though.
-Get set-up for your turn before the turn.
-Until you get more agressive or on a track put the crack of your ass, not past it, on the outer edge of the seat.
-Shift position your upper body like your trying to kiss your mirror.
-look through the turn or where you are going. The bike will follow.
-Throw that knee down and don't panic when you feel it contact for the first time by chopping the throttle off. This will lower the bike making it scrape more and change your weight transfer from the optimal 60-40 f-r to 30-70 f-r. That is bad juju and you might as well just hit the front brake while turning, same result.
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