So You've Been Trading Less than 2 years?

[Ken]

Here's a friendly, non-sarcastic, non-judgemental "safe" haven for all of you who are new to trading ... feel free to ask questions and I and our other traders will pitch in and share "lessons learned" so you don't have to make the same tough mistakes many of us did, back in the 90's in day and swingtrading stocks.

Ask away - what vexes you? What's "puzzling your progress"? Let's hear it.

-ken

[StaticVoid]

Can someone explain the +/-'s of Single Stock Futures vs Options. They seem like the same thing but SSFs have less volume.

[StaticVoid]

Question regarding systems.

I was just reading "Propulsion Plays" in the book Mastering the Trade. This play was to to wait till a 8-day EMA crosses over a 21-day EMA then buy when the stock pullbacks to the 8-day EMA.

How could one accomplish this? Is there anyway to set up these parameters in any trading platform? I use IB so details on this platform would be best but please let me know if this could be done anywhere.

I know one could program this using IB's API but Im wondering if these sort of "systems" are standard anywhere.

Thanks!!!!

[GoldMiner1849]

Hi,
I started trading early 2000 when friends were showing me large profits from the outrageous market movers. I read many TA books and took an online course, but never had a mentor. I didn't have a good strategy and lost 1/3 my life savings. In mid 2001 I gave up.
In Jan 08 I decided to restart my career as a daytrader and to do it "right" this time: develop good strategies; keep tight stops; trade minimal capital; learn as much as I can.
My goal is to retire from my current job and make a living daytrading. I have about a year or so until I'm eligable to retire and I want to be ready to daytrade for a living at that time.
Presently I have about $2K to trade with. I use TD Ameritrade and Medved Quotetracker. Because of limited capital I'm daytrading the QQQQ short term options in quantities of 20-50. Of nearly 20 trades to date I've had two "horrible" trades that I didn't "stop" out on, some "so-so" trades and some good and very good trades. All told, if I didn't have to pay option fees and trading fees I'd be profitable.
I know trading options is risky, but without the funds to trade stocks effectively I'm willing to take that risk. The short term spread is often $0.01 on near-the-money calls so I risk 3-5 cents or $150-$250 on a trade. Again, I think my strategy is sound as I would be profitable if there were no option fees and I eliminate the "horrible" trades.
I think the biggest problem I have is the confidence that I'm doing things correctly. I buy calls using the following strategies: fade gap downs; try to catch 7:00 am and 1030 (PT) bounces; and jump on momentum plays if bounces aren't evident.
I'd like to get some classroom training and, if possible, recommendations on brokers and software that doesn't cost an arm and a leg to use....at least not until I'm being profitable enough to be able to cover those costs.
Any advice on trading strategies, training, software, bokers greatly appreciated.
Pro-to-Be.

[Ken]

Hi - although this isn't individual trading advice, I can share that someone should plan on burning through at least 10-30K just learning how to daytrade, taking several years, before even hoping to become a break-even, much less profitable, trader. 2K you can't do anything on.

ken

[Vitez]

Hi Ken,

I found out that it's not that important for the market and the stock I trade to be making 2DBO/BD at the same time. As long as the market is outside previous day I can take the trade and be aggressive.
Would you agree with me?

[Ken]

Hi - no. The method I teach is based on having stocks and markets in the process of making 2day new high/low breakouts at the same time.

-ken

[liwin]

Hi all,

Would anyone be having success using the 2D h/l B/O using say the IB charts & Time & Sales only? Ken shows it clearly on the eSignal detailed layouts.

Just wanted to know whether it is possible to find the gapping stocks, screen & execute this strategy within the first half an hour of open or is it all over before one gets to see it so then have missed the main part of the move?

Would appreciate your comments.

[Cash]

Hi liwin

I use this method. I'm also a chart scan member. First, most my work is pre market. Second this a game of probabilities. Out of the dozen stock selection I'm given each morning only a handful will actually materialize. For me in the beginning was how many stock could I focus on. It was like juggling balls. 3 or 4 wasn't a problem. Another problem was picking the right 3 or 4 stocks to watch. Scanning is tough. I tend to get stuck waiting for the potential break out/down and miss the other stocks that are moving.

Now, I go in and set my alerts to a price right before the break outs/downs. This way the sound and my chart will populate my main trading screen. Set my S&R lines on my thumb nail charts. This is all done pre market and only takes half an hour, at most. This way less thinking is required as the action is happening, things are automatically popping up and I also have visuals when they do.

I'm an old cyber trader guy and use their platform. I don't like the fact the T&S isn't a free floating window, but it isn't that big of a deal. They have a ratio window but I find it less important than Ken when entering a trade. It is nice to see a big imbalance of trades going off on the bid or ask, it's just just icing on the cake, not a deal breaker.

Not sure which platform you're using but most have a screener/filter/query that will have built in queries such as; gap up: in gap, lost gap or stay up. They also have gap downs queries; in gap, stay down and gain gap. Check those out, also your top 10 gainer/losers. I also like the nas/nyse hi's & lows, I'll find a good stock there 2 or 3 times a week.

After a few weeks of trying and limiting my sections to 4 or 6 charts, things got better. So I guess your answer is YES on wether or not a person can go out and do this, just not going to happen the first day you try it.

[Cash]

I've been day trading Apple for the last two week giving it enough time to set up the trend. If you look back on a 15 min 10 day chart you'll see a down trend hugging the 50 m/a. then fine tune it with a trend line, have a little patience in your in the money. It will last all day long except the last 1/2 hour of the day.

Apple seems to have cycles that last 2 or 3 weeks. Last year in Aug. it reacted well 9 out of 12 times to the first reversal. Each day being about 5 min later than the day before till it was gone.

T&S seem a lot harder to follow on faster moving stock like Apple. It did save my butt last Thursday around 3:30. I was shorting it as it came up to the 50 m/a as I have done in the past quite a few time. T&S just could hold the lows; it wasn't acting as it had in the past. It formed a hammer candle stick. I covered my short loaded up on my long and rode it to the close.

On T&S it's a lot easier to monitor the flow of price when you have a slow moving stock and a bias that you’re going long or short. Longs I have resistance set as a price on my chart then I correlate that with T&S box. I give a little more money to avoid false breakouts. Typically 15 to 25 cents, you'll know that range for that stock because you were probably burnt before trying to squeeze out an extra nickel or dime. Watch the speed of the tape and size of the orders and know where resistance is in the market. If you’re right it will probably happen within the next 30 seconds. What I like to call the 30 second rule, if you right it will usually happen right away, if not get out.

Chances are better on an outside day. Doesn't mean not to trade on an inside day. Just pick a zone you're not going to trade in, what I like to call to much noise.

Like anything else in life do it 100 times and you'll get good at it. You need to suit up every day and do battle with the market. For me 75% of the time, things aren't clear for me, so I don't trade. That was one of the hardest things for me to do, was wait!

[liwin]

Cash,

Grateful for your generous detailed insights.


liwin

[rmherbert]

so does anyone think this tactic can be set up as a trade entered premarket?
tnx,rmh