The tape is just easier, imo, to read on stocks that avg maybe vol of 200-500K/day. If you go long, watch for the bid to get hit as a time to get out. Don't have more shares than what you see in bids. And remember that all the other monkeys are eyeing that same exit door as you. When a stock is going up with a big bid, it often drops soon after that bid price starts to print. Get out when you can. Just my .02
Do these stocks you watch follow the futures or are you just watching for size to come in and push the stocks? Are you trading the same few stocks everyday or jumping around alot. I think I got the idea of trading the big cap liquid stocks from seeing posts by Don Bright because of the safety factor.
What is it about BAC that you like besides moving around a lot? It looks like it has some good moves on a chart. Thanks for your reply
I jump around a lot. The lower the volume, the less an nyse stock will track the futures. And "safety" is a relative concept. Some very liquid names are not very "same" to trade, at least in a macro sense that more traders overall will lose money. IBM and TXN come to mind. But, again, do what works for you.
I used to scalp Nasdaq stocks trading for 10 cents. I think those days are kind of over. I tried to look for moves and stocks that had potential moves of like 20-30 cents but found it hard to trade because they are so choppy now. Thought I would check out NYSE because I have been told by other traders that made the switch that they move a lot smoother than nasdaq stocks. I thought scalping NYSE stocks might be a good transition since it was a similar style of trading that I was doing before but different exchange. Anyway if I don't like the results or the way they trade short term I am thinking I will go back and trade off of charts again. Since the time frame will be longer than a few seconds/couple of minutes, I can see myself trading both markets. I wanted to try scalping the NYSE first though. Long answer to a short question.
When I traded naz, my avg trade was about 40 seconds. Now on nyse, it is about 4-5 minutes. It takes time to adjust to the slowness. Just fwiw.
That is a good point. That has been hard at first to get use to. I start getting the feeling that "hey it is not going right away, maybe there is a big seller now". I end up talking myself out of staying in the trade because it is so slow. So I am trying to figure out when I am being impatient and when I am right.
It is amazing how styles can be so totally different. I hold nasdaq stocks a lot longer than listed. My timing isn't good enough to "scalp" nasdaq stocks I guess so I give them MORE time (in general). Whatever works for each person is the right thing. No mysteries about that. The stocks I tend to trade on NYSE are the financials. They trade well as a group, and trend intraday fairly well. The volume is usually good enough to keep them liquid enough so you don't get "stuck". Banks and brokers. Drug stocks can be ok on the days they are in play. JNJ being a dow stock is always pretty thick. IBM and TXN as mentioned can be tricky. MU is ok as a listed tech stock. I trade IBM all the time anyway....but most of the New York Semis (sounds like a team or a Hip Hop group) can be rough to trade early in the day. LSI, ADI, AMD, etc. They seem to be tough to get honest fills with. They tend not to have much volume early (first half hour). My .02 RS7
When I traded small/mid caps i found that not only would it be very difficult to exit if you missed the bid but if the specialist knows daytraders are buying stock he will often pull the bid and sometimes even offer it forcing traders to cover. In these two scenarios liquidity becomes a real problem because not only do you want to get out but all of those "other monkeys" want to also. When this happens it was very common for me to scratch the trade or even lose money on it because other traders would limit and market their order to exit causing the stock to drop. I also noticed that the bid rarely re-appeared. I now trade large caps such as GS, MER, MMM and find that for the most part what you see is what you get. The landscape in large caps is much different than naz stocks yet at times much more comforting than the small/mid cap stocks because the inside quote seems to be more reliable. Just my thoughts! Carlos