In this market I am often reminded of the old adage. "Not Trading is sometime the best trade to be in". The currency troubles that will fall out of the PIIGS problem in Europe might give us better trading opportunities. All markets hate uncertainty. Certainly glad I don't live in Greece, it will be ugly as the unions just have no idea how to now tell their members that to survive they have to work for a living for a much longer time. Hard to learn you have to work to 60 when you were promised a "full pension" at age 50. No one like reality when the fantasy was so much nicer. Have a great weekend, and may you find the markets you seek. Jason Mansfield
Here's my response, maybe Lescor can add his opinion also. Below is an example of a trade from yesterday. Huge momo in the morning, completely detached from ES. This is one chart pattern I love and it used to happen all the time. In the past year it's rare, while in '07-08 you saw it in multiple stocks almost every day. In a more active market (like this week) reversions and breakouts happen all day long. It doesn't matter what ES is doing, as long as there's some volume and liquidity in the market these situations will present themselves. Crossing fingers that we continue with some downside momentum next week, this has been some decent trading.
Dustin On something like RDK trade do you usually scale in and scale out? Or 1 entry multiple exits, etc? Also do you get ECN rebates? How many stocsk do you usually trade per day? Thank you
Yes reversion trades I typically scale into as it goes against me (and often double up as it starts coming in), while breakouts I add as they move in my favor. All ECN rebates/fees are passed on to me. My current favorite route is EDGAROUC. In an active market I will trade 20-40 stocks per day. Most of these will be break even or small losers, with a few good winners.
Thank you Dustin, How do you decide when to exit, do you let price action tell you or do you know your exit point before entry? Reason I ask is because when I have 5-10 open positions it's getting harder to watch them at the same time. How do you deal with this?
I know generally where I expect the trade to end up and I try to scale out around that point. If you don't already, try sorting your open positions by P/L and just manage the trades that are on the top and bottom...the trades in the middle shouldn't need attention. Also have enough charts to handle every position you are in.
Figured it was time to post something. These past two weeks have been the best trading environment that we've seen in a long time. I guess what it comes down to is where there's fear, there's profits...at least for my style. Crossing fingers that the volume and volatility continues. Have a great weekend everyone.
Quick update Dustin, how has your trading in June fared? I'm having a real tough go, first month in awhile i'll (most likely) be negative...
It's been tough considering the high VIX. We didn't get any good panic moves in individual stocks even though the market was moving. In fact I don't know anyone doing well this month. Last month was good though.
Looking back with hindsight, do you think that the 7 1/2 months since your original post were a bad, normal, or good time to be trading?