i've tried everything and nothing works

Discussion in 'Trading' started by dg2000, Sep 19, 2001.

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  1. dg2000


    i've been trading for about 2 years. i've made money overall, but lately i've just been going nowhere to slightly losing money. i've read all the books, tried all the indicators, tried no indicators.... i know about money management and position sizing (which probably saved me from doing worse), but i still can't seem to get anywhere.

    here's a trade i exited today for yet another loss.

    PSC, daily chart, the stock is at a low point of an overall uptrend. i bought it 9/18 because of the move it made the previous day. i used money management and position sizing to determine the number of shares i would buy based on where my stop would be (under the previous day's low)... i usually either do that or at the end of the day i check to see if it is closing under that low. well sure enough, today it went under the low and also closed 7 cents below it. i know that isn't much but i had to stick to my plan and sell...watch it go up tomorrow.

    can anyone here see any problems with this strategy?

  2. dg

    As someone who has also had difficulty using traditional trading strategies in recent months, I am probably not the best qualified to tell you what you are doing wrong, but here are some comments.

    Recently I have noted that very few of the traditional strategies are working. The old momentum strategy of wait for a pullback and then buy /sell 1 tick past the previous high/low keeps failing, with major reversals just as these points are reached.

    You should note that we are in very unusual times right now and a lot of the traditional rules are broken. This has been compounded with the recent events of 9/11. I have been strictly doing short timeframe intraday scalping (.30 to .75) for the last four weeks with some success, but my preferred trading method of 3 day swing trading is not working right now (except on the short side). Given the impending possibility of war any day now, I am also wary of holding overnight.
  3. ddefina


    Try using buy and sell stops at the previous days high and low. PSC started dropping on August 28th, 2001, and has been dropping for a couple weeks, with a couple small reversals. On your trade, you could've put a buy stop above 9/10's high of 26.70 say 26.76. You would have been filled there (+/-) and then placed a stop loss at the previous days low, adjusting it each day. Today your protective stop at 26.69 (below yesterday's low), would've been hit and you would be out at small loss and then flipped your position to go short at the same price. You would then be in the money roughly 70 cents. Usually if you don't make ground going one way, you will going the other, so if you flip your trades, you can usually come out ahead. Also, if you sell half your shares at a 5-7% profit objective, and let the rest ride, you can hold trades longer psychologically. It appears this stock is in an intermediate term uptrend, but in a short-term down trend. It's hard to predict trends so I don't try, but good luck if you think you can do it.

    I believe Larry Williams said that "Hope is for Dopes, but Spinners are Winners."
  4. hey man =)

    hang in there.. the market will get better..

    about your psc play.. personally, i dont see any reason to trade it today, especially considering that its in an uptrend and the mood of the market is down.. the nearest play that i see on the daily chart is the pivot on the 17th near the 50day ma.. a buy would have been triggered over 26.70.. but i probably wouldnt have gone against the market then either..

    i recommend that you consider reviewing your trades to see if you have been trading against the markets trend..

  5. dg2000


    thanks everyone for your posts. my strategy was to only trade stocks in uptrends. i know the markets are in downtrends, but i figured that i could still play the long side as long as i stuck to uptrending stocks. i know many of you might recommend to just do the reverse of what i'm doing, but to the short side, and go with the market..but i hate shorting. in the past when i shorted, i usually had a list of stocks to short at the end of the day and when it came time to enter the trades, i had to sit there and enter the orders over & over hoping i wouldn't get a downtick...the uptick rule annoys me. on top of that, my account is right at the $25,000 level and with the upcoming new SEC rule, i don't even know if i'll be able to have a margin account to short with. what a great new rule by the way... (sarcasm)
  6. ddefina


    If I were you, I'd get a little more money and still try to short. We may have 6 more months of down markets and you'll be at a real disadvantage going against the trend. The uptick rule is a pain, but not impossible. I use market stops and don't have too many problems, but I haven't traded that stock either. I think an unbiased approach to the markets is the best long-term plan.
  7. If youve been trading for two years and are ahead you should be proud of yourself. I've seen a lot of pretty good traders taking a beating lately. If nothing works, stand aside for awhile. If you cant short this market your better off in cash.:)
  8. One general key that has allowed me to consistently profit is to distinguish between trading during a bull market and a bear market. Having traded in both and witnessed a lot of intersting things, here are a couple of observations:

    In a bull market

    --Supports tend to hold better and resistances tend to be weaker
    --Morning gap open highs tend to be taken out more easily and gap downs tend to fill in better

    In a bear market

    --Supports tend to be weaker and resistances tend to be stronger
    --Morning gap open lows tend to be taken out and gap ups tend to pull back more easily.

    As an example, today I shorted IMCL, which gapped up $6 then promptly pulled back to only up $3 for a quick 3 point profit. In a bull market my strategy would have been different. I would have waited for the morning gap open and any subsequent pullback, and bought the stock as it crossed its morning opening high.

    Making a clear distinction in stock tendencies based on a bull or bear market has worked extremely well for me. Hope this helps.
    PennySnatch likes this.
  9. If you must play momentum, look to those stocks that are truely strong. Pep made a new high yesterday. I tried to buy some calls on the pullback today, and wasn't hit on the bid. Momentum still works, you just need to find where the money is going. That stock that you liked, looks like it's in the process of rolling over honestly.
  10. dozu888


    Geeee, really??? nothing works??

    What a shock ! :D :D
    #10     Sep 19, 2001
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