triple low alert

Discussion in 'Strategy Development' started by hoodooman, Nov 2, 2003.

  1. Lately, I've been working on a strategy to trade stocks that are the biggest movers (down) premarket. Friday I was watching a stock that was set to make a triple low and so I sent out a thread alert on ET in case someone else might want to try to trade it. I got no replies.

    Later, I sent out another thread asking if anyone had tried the trade (it subsequently went up .85 on a pretty slow day ) and got no answer on that thread either.

    I know that I would appreciate it, if I got a handle on a trade like that. So I was wondering what the problem was.

    I also think we are missing some great opportunities to trade classic patterns because for the short time that I have been a member of ET, I've never seen a stock alert of any kind.

    All replies appreciated.

    Best regards
     
  2. JORGE

    JORGE

    I agree it would be a good idea to post some trading ideas unrelated to futures, but I don't think anyone trades equities anymore. 90% of my trading involves NASDAQ issues which have gapped on news, I was watching ZIGO on Friday, but was uncomfortable with the liquidity.
    This morning I'll be watching FHCC trading between 20.5- 21 premarket, possible support in this area, ELBO and RDWR also on my list, but not sure which way to trade them yet.
     
  3. I am right with you. This is the only reply to what I think is a great strategy and a great way to use ET to our advantage

    regards
     
  4. hoodoo is the strategy posted somewhere? I trade only equities, but I have to know and understand the strategy before I use it.

    And... although there were no replies, there were a number of views. Never judge the quality of your post by the number or quality of replies you get. We have far more readers than we do active posters.
     
  5. inandlong

    No the strategy is not posted.

    The strategy is simply to find stocks that are down the most premarket and watch them with the idea of trading the ones with decent spreads.

    If the stock breaks resistance to the upside at the open, I buy it. If it doesn't then I wait for a firm confirmation of a bottom (double or triple low) and buy it.

    I like to call it the "rubber band" strategy,i.e., the stock is so stretched down that the eventual move to the upside could be considerable.

    I was suggesting that we ET's should start alerting each other about plays like this.

    regards
     
  6. Several times I and others have tried to start threads with the simple idea of posting specific trades. One member, Gary McLaughlin continues to do so, but posts each one under separate threads. I have never quite understood why threads like this don't boom here, but I would support one if it were in the Trading Forum. My thought is that it would be strictly something like:

    Symbol:
    Buy/Sell @ : # or "break of high on 5 min chart" - or a brief reason for the trade
    Suggested target: if there is one
    Suggested stoploss: if there is one

    The problem is that commentary starts being posted by other members who either disagree with the method, or want a turnkey trade guaranteed to make money.

    So if you would like to start a thread in Trading Forum and limit it to trades only.... similar to many chat rooms.... I'll support it.
     
  7. all I really wanted to do was give alerts on stocks about to make triple lows or highs. Seems like very little support for it to me. Where anyone trades it is their business.

    I just don't have time for that.

    Watch for my alert. If I get another triple. I will post it.

    regards
     
  8. elbo made quad bottom at 12:45 but I didn't post it because the trading was so lethargic. Probably just as well, its only up .20
     
  9. elbo was a winner. up almost a buck after the call.

    Don't have much data on this strategy. What I need are daily premarket archives, where I could go back and check for stocks that were down the most, premarket and then take a look at how they traded intraday. This might be a fair evaluation of the method.

    You can't back test this can you?
    regards
     
  10. Bob111

    Bob111

    i believe-this is the reason,why you got no respond from other members. it is impossible to backtest and figure out whole picture for system based on after(pre)market data.
    one of my friends trade gaps down like year ago and with his strategy he was able to make 6-7% in average in intraday. i was really surprised by his performance, but something tell me that it not going to last long..
    he explain his system to me and ask to backtest. after i code it and did backtest on 10 years and thousand of stocks i got very poor results and i did figure out that in this particular moment his system on top of it performance and as we all know-bad things start happends just after we come in to party. i told him that is market sentiment change-you will lose you short on this system. he was totally disagree. i never trade this system and after next three month and some money he does agree with me. it is work fine in bear or flat market, but with only one question-how you will be able to predict market sentiment for next frew months?
    you did mention something like triple low-if you don't mine-can you be more specific? on what time frame? pictures will be helpfull.

    ------------The strategy is simply to find stocks that are down the most premarket and watch them with the idea of trading the ones with decent spreads.
    -----------------------

    this part is very easy to do..all you need is scanner to find those stocks. nasdaq stocks gapping up or down can be found on island top list.

    ----------watch them with the idea of trading the ones with decent spreads.
    -----------------

    this part very informative...no wonder -you got no respond..

    --------------If the stock breaks resistance to the upside at the open, I buy it. If it doesn't then I wait for a firm confirmation of a bottom (double or triple low) and buy it.
    --------------------------------------------------

    what resistance? of current day or something else?
    possibility to going down after breake yesterday(for example) high is very much same like it will go up. specially after big moves in first five minutes.

    --------------premarket and then take a look at how they traded intraday. This might be a fair evaluation of the method.
    ------------------------

    this is poor method of evaluation. almost same, like been mentioned in system above. but at least this guy use certain % up or down on open. today-people will buy every dip(gap) and they don't care about bad news anymore(remember 2000?).
    for me it looks like you want to trade early day breakout which been explained in many books already with implementation of premarket moves as possible direction of breakout. tell you what-all losers, who in hurry to buy or sell will be there(and they usually wrong). i saw it every day.
    that's my own opinion about all this stuff that i read here.

    thank you!
     
    #10     Nov 3, 2003