Question? On some of the scans there are a couple of stocks that had gap down days and then went lower. Today they were acting strong. ie. cytc and dige. In the past I never would have touched stocks like those. Does anyone have any experience in these types of trades. Should you wait for one more sell off. a break into the gap, or stay away. thanks. P.s. made a bad short on 0sip lost 20 cents. I wanted to short something b/c the market was going down. I went back to the S&Ps. for that as I have a better handle on those lately. Now I am in another stock I sold 200 for 25 cents and am still long but I do not want to look at it. Unless my target or stop get hit. I am sure I will though.
I took INVN at 33.06. I took it because it traded down and then sideways, found support just above 33, while the futures were still declining. Stop was 32.95 and target was 34.00. I got stopped out at 32.90. The stock is now tradigng higher. In retrospect, I should have waited until the stock started trading up before I entered. My stop was probably too tight also. jem, It's amazing how similar DIGE and CYTC trade. Isn't it always best to enter on the first day of the move? Mike
Just a comment....this happens a lot, and sometimes using an "alert" rather than a stop works a lot better. We advise our traders to never use actual stops, since we want to evaluate the overall market before "bailing out"... Don
Don, Thanks for your input. I really want to kick myself now that its trading over 35.50. Does anyone have copy of Tony's Stock Trading Wizard that they want to part with? Please PM me. Thanks, Mike
In looking over your Skyscraper and Bottom feeder programs, I see that you scran for certain stocks that have made large moves for 3 straight days. I assume you then find points of resistance or support by looking at the charts, then find the reward/risk ratio using your stop loss point. My question is "Is there anyway to program in these support and resistance points to scan for your highest reward/risk stocks?" Thanks JJ
I think you mean the reverse. Find your stop loss based on prior support/resistance. Likewise with the target. Then calculate Risk/Reward ratio.
I think yours is a useful approach since your traders exclusively trade listed. If they set hard stops it would sit on the specialist's book, and for whatever reason he may decide to run the stops. But for those who trade Nas the hard stops sit either on your trading software or your trading server, so market-makers have no idea where your particular stop is set. Point being, if you're holding a number of Nasdaq positions, often hard stops are the only way to go since no one knows about them, and they free up your attention for other concerns. Otherwise, if you use "alerts", especially if you are playing for less than 1 point, you would have alerts firing all the time and then you'd have to sit and stare at level 2, t&s, etc. to decide whether the move will continue against you. All the while, for however long that takes, your total attention is tied up on that position. Of course, if you are currently only holding one position or you only play one position at a time, then I agree with the "alert" idea.
Like many other things about trading it probably all depends on your approach. I agree with Magna in this manner I have been trading futures and scalping stocks while learning these oz scans. Sicne I am doing more size in these other endeavors they demand my attention. Therefore I have to use stops here b/c a I may not be ready to look at the stock when my alert goes off. Besides I did try to manage and expe trade today and Iwould have been better off if I let my stop take me out. This does not make don wrong. I agree that from my own observations if disciplined and attentive I would probably be better off getting out on the bounce after an alert rather than paying the price at market with my stop. I am consider using stop limits if I am not in a futures trading mode. That way I might use the stop trigger and either get a "good price" or then be ready to manage the trade myself and cancel the limit. Lost a little trading today stocks today but had a good daytrading futures. I don't think I am going to make any trades on these scans until I feel the market is staging a turnaround. Then I will put on some size and be committed to the positions. Today I was just toying around with tight stops and it was a waste of time. As stated before this morning wanted to short something so I found osip on the scanner it wsa extended. sold at 21.21 @ 10.04 . I took a twenty cent loss. Bad trade At 10:38 I bought 400 powi at 19.55. off a powertrader or new kids. It was a nice pull back trade and it started to go up. But it had some selling that seemed unusual as I was watching it. Looked at an even longer term chart and realized that even though I was buying a 50day movavg bounce, the stock had sold off the 200 day earlier. I sold half and put a stop in for the other half . overall I made 35 bucks on the trade. Amazing how I have more clarity after I am in a trade. Tried to buy DLTR of powertrader or new kid. Never got filled. Bought 400 DFXI at 42.17 (I will strat writing them down) Put in stop at 42.09 got filled at 03 or 02 rather quickly. Did not like my discipline on this trade but stock did nothing anyway. It had a nice chart and looked like a daily chart for the old momentum days. sort of took the trade on nostalgia hoping those trading markets type entries would work here. Then I had a ridiculous trade in expe. I was just thinking about how I put on my largest futures trade in 5 years and it worked. Felt good. bought 200 expe let it go 75 cents against me after I had cancelled my 17 cent stop that was at support. I do not even want to look at the chart to rehash for you. It was stupid. Lost 10 more cents on a DFXI trade. Good setup at the time nothing happened because the market was so weak. Moral of the story. I will only trade in the direction of the sector of a stock absent really good circumstances. Lost $221 on stocks today. I also do not feel like shorting stocks I don't know down here because of the potential for a large squeeze. However I will be shorting after a rally. Stock selection c- discipline d (at least Idid not lose more)
Long GNTA (Usual Suspects) Entry:14.40 Stop:14.17 low of previous pullback Target:15.75 (Upper BB) and below opening The price had bottommed twice at ~13.81 and then traded up forming an assending triangle, with support just under 14.50. Instead of breaking out the price broke down and I got stopped out at 14.17. Was this a good trade? I don't know. Short OVER (Knock Down) Entry 32.91 Stop 33.30 (previous resistance) Target 31.00 (Picked it out of thin air) Opened at 33.60. Traded down and found support twice just above 32. Traded up to 33.25 and started back down. Took short position. This was very frustrating because it traded between 32.70 and 33.20 for quite a while. I was really hungry and did not want to leave the computer to eat. Finally this pig broke down and traded to 32. It then traded back up. I exited at 32.51. I don't think this was a good trade. First, my target of 31 had no technical basis whatsoever. Secondly, this was the second day of the move. Thirdly, A better target would have been the low of the day ~32. Fourth, I should have bailed when the price could not break 32. Criticism welcome. Mike