Four months is a pretty good run, but a long way from guru status. IMHO, if a trader can't be specific about why they entered/exited a trade they're just guessing. You can guess right for quite some time. I know this from personal experience as I guessed right for about 8 months straight some years ago. I too, felt I had the magic "feel for the market". When I started guessing wrong I had no point of reference to look at. The inevitable drawdown was exaserbated by that fact. Enjoy it while it lasts and who knows how long it will last. Until then, ride the big one all the way to the shore.
One good thing is that over the last 4 weeks, the market has been pretty choppy. It was nothing like in late 90s when every tech stock you pick was going up. Everyone guesses when he/she trade. It's just a matter of how confident are you with your entry based on your own system. I have yet to analyze my entry points more carefully, but I'm sure I subconsiously look for a certain bullish & bearish patterns, which happens again and again and again in every stock, and I get in. Perhaps since I've been looking at these 1-/5-min charts day and night for the last 4 months, I've just become accumstomed to recognizing some of these high-probability patterns very easily with very little effort, so it feels like I'm trading instinctively.
I find it interesting that Steve T. trades this way, because i would describe myself as also trading this way. Steve T. as many of you know is the most consistant trader probably on this board. I average about 1 negative day every 25 sessions, and that is normally quite good, but he averages 1 negative day probably ever 40-50 sessions. I agree with the OP that you can feel a stock is going to break up/down at least for the immediate short term. The problem i have found is that the liquidity available at these profitable entries (and often exits) is generally fairly thin. I trade in 900/1800 share lots on a stock that does around 4million share a day. I scalp out around 18-100 bucks on a good trade, and lose 0-50 on a bad trade, occasionally more (sometimes you just cant help getting fooled). I made about 100 round trips a day. The key in my opinion for enhanced profitability with this type of trading is to know when you can take a swing and take more shares than your default. For instance a situation generally arises a couple times a day when i could take 5-10k shares with similar risk than 1800. It is these special situations that extremely quick decisions are needed to profit. Sometimes hindsight is the only way to identify them. I trade off of 1 minute charts, no volume or indicators, but i do somewhat 'predict' the movement based on prices relative position.
[ I agree with the OP that you can feel a stock is going to break up/down at least for the immediate short term. The problem i have found is that the liquidity available at these profitable entries (and often exits) is generally fairly thin. I trade in 900/1800 share lots on a stock that does around 4million share a day. I scalp out around 18-100 bucks on a good trade, and lose 0-50 on a bad trade, occasionally more (sometimes you just cant help getting fooled). I made about 100 round trips a day. You scalp 18-100 on a good trade, I try to scalp a little less since i trade in 100-500 blocks. USually 15-50 bucks. But many people I talk to who buy and hold think im crazy for trading lets say 300 shares of INTC for 12 cents. They say why risk $5000+ for .12 on a trade.
"But MANY PEOPLE I talk to who buy and hold think im crazy for trading lets say 300 shares of INTC for 12 cents. They say why risk $5000+ for .12 on a trade." For scalping, as long as there is enough liquidity for you to trade 300 share lots (which is definitely the case with INTC) and you pick the right entry point, there is nothing wrong with risking $5000+ for $40-50 profit for approximatly 1% return. Risk can be minimized by picking the right entry point and knowing your exit plan ahead of time along with the undertanding of stock's volatility...all in my opinion.
"I average about 1 negative day every 25 sessions, and that is normally quite good, but he averages 1 negative day probably ever 40-50 sessions." You 2 guys are like a rock star. That's the kind of success I'm targeting in the near term. So far my best has been 8 straight positive sessions early last month, but I'm currently sitting on 7. I want to break that record this week.
I get this instinct when I start adding in a lot of shares. I can add in 2000 5000 share lots if I noticed an extremely good opportunity, usually from instinct, Most likely its not from instinct, its more like all the indexes are all lined up , the stock is lined up, everything is lined up for a a huge jump Pretty much no way it can go down aka "I've seen this before 100s of times" aka experience.
Iam bit lazy to write a detailed plan of the trade before or immediately after enetering the trade.While reading this thread,suddenly I got an idea why not immediately save the chart with the indicator set up(I can do it in my medved qt charts),import it in to the word/paint & mention the trade taken (immediately after the order got executed) Iam thinking out loud.when I close the trade(profit/loss),take the shot of the chart & compare why it was successful/lost! Since I trade expiring options aggressively in the last week,I will usually enter all my trades in 10D/15m chart & analyse at the end of the week. Usual story-I started buying call/put too early,average down down down & sell all of them too early when there is reversal to my predicted direction. net result meagre profits for the effort put in.Iam attaching one of my old charts which is handy.(mar 2006) I have not done this week analysis yet.I played mostly IWM options.Nothing to boast!! MM's became stingy & killed the delta of all Aug options.Direction right but ATM/OTM option got peanuts!! having written this post, my mind is made up of maintaining daily chart journal of all my trades. other traders practices/constructive criticism welcome!!