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Saturday, July 01, 2006

Mixing it up with longer-term trades (1H2006)

posted by Tom C:

First, I want to thank Trader-X for letting me contribute to this blog. I really believe that everything you need to be successful as a trader can be found here, it just takes some time to go through all the posts and then it takes effort to apply what you see to your own trading.

Trader-X gave me some latitude to go out on a limb with this post. Obviously this is a daytrading blog, and I know X makes most of his profits from daytrading. But, everyone needs to remember what he has said in the past - a chart is a chart, and a good pattern on one timeframe will be a good pattern on another timeframe. If you remove the "time axis" from the chart, you should not be able to tell the difference in a set-up on a 15-minute chart vs. Daily or Weekly.

As today marks the 1/2-way point through 2006, I like to review where I am at for the year. My daytrading accounts for over half of my profits, and it has been a great six months. But I also have a longer-term account where I trade almost exclusively based on Weekly charts. The thing is, the set-ups I look for in that trading account are the same set-ups Trader-X highlights here post after post for daytrading.

I have cherry-picked two of my most successful "longer-term" trades (thus far in 2006) to share with you. I have marked both entries and exits, and I think you will recognize the patterns as "classic Trader-X":

- MED - a long entry above the Fibonacci extension. I sold the position at the beginning of June when price took out the previous week's low. Total return was over 70%.

- TUES - a short entry on a perfect hanging-man at resistance from a declining 34MA, and below the retracment zone. The target was the Fibonacci extension, and it was hit a few weeks ago. Total return was over 30%.

Hopefully that can be of help to you in the second half of 2006.

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Trader-X said...

posted by Trader-X:

That was a great post Tom.

But to deflect some of the nice things you said about me, the genesis of trading on the weekly chart based on the previous year came from our friends at TRADEthemove.com.

You touched on what I always tell people - don't try to copy what I do. Take what I do, tweak it, apply it to your trading, and make it your own.

T. Webb said...

That is pretty amazing. Now I am going to spend the rest of my weekend looking at weekly charts. My wife is going to be pissed at you.

Doug said...


Tom C, where do you get your candidates for these trades.

FYI - I looked at HANS and it set-up similar to MED above the Fib extension. It then ran from 110 to 200+.

Great blog.

QQQBall said...

Nice trading. very good discipline on the exits.

Trader-X said...

posted by Tom C:

Doug - I don't have one source. I keep a list of stocks I watch, and those may come from stories, stocks I know are moving, etc. Also, I look at IBD 100 and New Highs/New Lows. I take a few hours on Sat morning and look through a lot of charts.

Mark W. said...

I just found this blog and I am amazed. You guys have quite a bit of informaiton here, and I am going to spend the next few days going through it. Thanks for sharing.

Barb said...

Nice. Care to share your watchlist?

: )

F.G.R. said...

Tom C., great trading and analysis. I am thinking EBAY is a good short here using your techniques. What do you think?

BL said...

Something I've noticed over the years is when a stock hits 20 ish many times it really moves up. Maybe keep an eye on new highs around 20. CLDN RSYS KBALB CTCI comes up.