how to trade a slow bleed

Discussion in 'Trading' started by silk, Feb 8, 2003.

  1. silk

    silk

    I day trade NYSE stocks.

    Slow bleed days like friday are very tough for stock traders. There is no volume/moves in key names to read on. No sectors are really in play.

    At any point in time there is really no reason to jump in or jump out.

    The only hope is to take an initial position and hope you choose correctly.

    Somehow i took initial short positions and still managed to screw up. The stocks i shorted stayed resilient for a few hours so i covered them. I know what usually happens on a quiet fridays when you are short stocks that don't want to go down. They burn you.

    Sector trading continues to be a disaster as insitutions arn't making decisions and are sitting on the sidelines until the war.

    I finished 2002 at my all time high, and now i'm losing 10k a day in 2003. I don't believe i'm doing anything different. If i'm smart i would sit it out until the war is resolved.
     

  2. :confused:

    you need to step aside and reevaluate. there is NO NEED to trade everyday, the market isn't going anywhere.

    best to you,

    surfer:eek:
     
  3. nkhoi

    nkhoi Moderator

    could you sell some call instead.
     
  4. let him go surf....anyone that can afford to be down a quarter of a million one month into the year can probably figure it out for himself...
     
  5. TGregg

    TGregg

    That's what happened to me at first. I was jumping on breakouts to the downside just a bit too early (before they actually were breakouts), and putting my stops in just a bit to close (get nailed just before it would reverse). My problem was, I was confident it would be a down day and had a short swing trade on, so I was too aggressive.

    I did a few trades like this, and had 100% losers(!), a clear sign for my high probability style that I am out-of-phase with the markets. A review of my trading and a couple of paper trades later, I was ready to go again. Covered all my losses and my commisions and even made enough for a nice bottle of wine. Yet another lesson in daytrading - learned and paid-for.
     
  6. 's funny dude! But I gotta agree with him - trying to d.t. this suck of a market is soooooo boring that my brain just turned into a 4-ounce lump of grey putty...
     
  7. Daniel's correct... its actually true, to the best of my knowledge...

    Silk is an intraday larger trend trader, and he does it in SIZE... when it works, he pulls in big cachingos... when it doesnt work, its inevitably gonna lose him around $10k a day...

    This actually ties in to my thread entitled "POLL: Your choice of a positive expectancy system"...
    >>>>> http://www.elitetrader.com/vb/showthread.php?s=&postid=200730#post200730

    Silk seems to be going through a drawdown period on Option 1, even though his system remains positive expectancy over the longer run...

    If option 1 is the preferred stategy, what differentiates the successful from the failed trader is the ability to stomach a potentially long series of consecutive losses in implementing an Option 1 methodology...
     
  8. Does anyone else find 2003 to be some of the lamest trading in years?

    --No strength in any of the moves
    --thin order flow on the specialist book
    --stocks individually having little or no correlation to moves in the futures.
    --almost impossible to move any size through the specialist w/o massive slippage.




    I only hope it is this war and not some more secular development biffing everything
     
  9. silk

    silk

    The problem lies in that it is very hard (for me) to know when it will be a good day for day trading. Clearly my biggest mistake this year has been to make too many trades in situations where there isn't anything really going on. Mainly that is because there has been SO VERY LITTLE going on. And clearly my long bias has hurt.

    A profitable trading environment has 2 main characteristics.

    1. Price volatility (We have had this in 2003)

    2. Active volume and aggressive buyers and sellers in paticular areas of the mkt. (This i havn't seen much of).

    In my opinion, without number 2, number 1 is useless. Because a good trader uses #2 to determine whether to be long or short.

    If the price volatility in individual stocks is all a function of a slow bleed in futures than it is hard to trade IMO.
     
  10. does what you do involve having a full book out by 9:45, hoping to catch the meat of the morning's move? (you know, 30 positions, couple thousand shares each..)

    i know of, well, i've heard of, a lot of 'big' traders trading like that...
    i tried it myself for a few weeks, obviously nowhere 2000shares, but i couldn't stomach the uncertainty of not having an idea ("prediction" -- ooh ahh) of what was going to happen...
     
    #10     Feb 8, 2003