You can try next : You can trade only 500 size 2 weeks, do homework good, and you find good stocks If statistic first 2 week's good, net is positive, you can trade 700 size .. Stop loss 10-15 cents .. Total loss on intermediate term items for a month should not exceed 150 dollars, total loss for a month (not volume) should not exceed 450 dollars (at minus achievement - transition to a paper).
jr07: Here are a few suggestions: 1. watch only 4 or 5 of the SAME stocks, no more than 10, with the price and volume characteristics that meet your criteria. 2. do not chase news driven stocks, unless you happen to either catch the news early, or play the reversal of the entire move intraday, when the market flushes out the stops and pulls back, usually a 50% fib will suffice. 3. see how your results differ after waiting for the first half hour rather than the firs 15 minutes. market makers will fill orders and stop losses usually within the first half-hour, when things are more whippy. sometimes, it's even better to wait one full hour. 4. the 2 x 1 reward to risk is fine. however, I have the same issue, where I take the 1x drawdown but the stock doesn't move enough to get the full 2x reward, so many plays sell at breakeven. one adjustment would be taking a larger share size and making a 1x1 plan. anything greater than a 50% win ratio puts you in the money ok, hope that helps, good luck...
Thanks to NoDoji Scalper Joe and RichKid for the follow up comments. I was on holiday so sorry for lack of follow up. One thing I have been testing this week with some added success is placing small trades at the open of all my monitored stocks and then at 9:45 I add to the ones working and let go the ones that don't. In many cases the main move seems to occur within the first few minutes so this is a way to confirm the trend (put finger in the water) whilst jumping in early. Makes sense? Or is it best to simply wait until 10am and go with the second or third leg of whatever is working/is confirmed by the volume.? Question for NODoji on the strong breakouts, is sometimes during market hours and due to some announcement or news, or 'LBO' or 'takeover' rumors or an FDA approval/rejection some stocks make very strong moves accompanied by volume. How would you trade these? Because there seems to be no real sense in the next step of any of these moves. Sometimes, the stock drifts lower and stays like that for the rest of the day. Sometimes, it pauses and makes a higher move and then begins to drift/retrace. And sometimes it rapidly begins to give back the entire move. I almost feel like I need to avoid these 'big moves' since I have been burned by most of them despite using similar position to my regular trades. But the moves are so big! That benefiting from them can provide the food for an entire week, in a single move. Yet they seem so difficult to catch! Is it a losers game? Trying to catch these big rumor based moves? Take PMTI for instance. On Tuesday at 10:50am I received the news about the FDA approval of its laser surgical instrument. The stock was trading at $10.90 and when I opened the chart it was already at $11.90. At this level, there was still volume behind the move and price started to move higher. I went in and got stopped out minutes later at $11.50. First loss. Then at noon more volume came in with price heading down so I shorted at $11.30 and from then on it "drifted" higher and I got stopped out at $11.60. Second loss. Yesterday the stock was downgraded prior to the open at Noble Financial. Rinse and repeat sell trade above, rinse and repeat today. Heavy volume with downward price pressure, followed by drift upwards taking out previous lower highs. J
I personally never trade news/rumor-based breakouts. For one thing all the traders with real-time news feed already have a jump on the action and I always feel that I'd simply be chasing. The breakouts I trade are when price runs hard off the open, pauses or pulls back a bit, then starts again for a test of the high. AMZN this morning was a good example. AIG has strong breakouts when it's been ranging in consolidation for a while. AAPL's a great breakout stock, also POT when it establishes a trend day. There are a lot more that break out nicely (mainly due to short interest) such as WYNN, GMCR, and NFLX. I'm now focusing on trading oil futures, which also have great breakouts.
I think I may just stay away from those rumor based breakouts. They have provided no value. It's a shame though, who ever has been on the other side of my trades has made a killing... J