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Wednesday, April 26, 2006

A few charts from Wednesday

posted by Tom C:






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6 comments:

Dave C said...

Tom,

I saw CHH, but decided not to take the bite even though the setup was textbook. I was hesitant, because of the low volume of the stock (around 100k by the end of the 2nd bar). Volume-wise, how low are you willing to go before you feel that there's not enough liquidity, in case something goes awry and you need to exit ASAP?

Dave C said...

Sorry, forgot to ask this question to my previous comment.

Tom,

One of my biggest weakness is exiting at the first sign of trouble. A lot of times I would exit on a weak bar only to see it hit the extension near the end of the day.

In the example of CCH, I think I would have definetely exited at the end of the 3rd consective down bar. What made you decide to duke it out and wait?

Thanks again!

Trader-X said...

posted by Tom C:

I look at the spread on the bid and ask to see if it is too wide to let me exit...and I look at the trades going off to see what size. I have a problem every now and then, but not usually. It is the cost of doing business!

Trader-X said...

Tom C:

re: exits...it just comes with experience. With CHH, I saw it as a normal pullback from the highs. I had some profit, so I was willing to give it some room. I don't know that is a good answer, but it really is just experience.

Michael B said...

Tom/Traderx - Just a general question regarding entries; do you guys generally enter on stop orders a tick or two above the 2nd/3rd bar high/low, or prefer to manually fire orders? I'm sure this comes with practice, but I feel completely disorganized when looking at 10+ potential prospects just as the 3rd/4th bar begin to open, especially since the strongest stocks tend to all fire through the opening range at the same time. Thanks, love the blog!

Trader-X said...

posted by Tom C:

re: orders - I do a mixture of both orders - stop market and market. It just depends on my time and what I am looking at...I don't have any hard and fast rules.