I am leaving for the day, but wanted to post the ANF chart. It is similar to my BRCM trade yesterday, but much "cleaner" and overall a better set-up.
I entered on a break of the ninth bar high which was the NRM, and an inside bar. I sold at the halfway point between the high and the Fibonacci extension (of the previous day's low to the opening range (OR) high).
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Tags:
Trader-X, Stocks, Fibonacci, Trading, ANF
9 comments:
Checkout UPS. Didn't take the trade but got in FDX later in the day based on UPS.
Like John in the previous post shorted DAKT and got stopped out.
LEAP, RACK and ANF my longs for the day. RACK nice and tight 15min bars.
Picked up MLS(15) short break of 2nd bar.
Day trades like today and the quantity to choose from don't get better than this.
Great day - picked PETM on the break of the second bar and took it to the top around noon.
Thanks X.
Check out TOMO above the Fib extension.
TJ
Dan, you might check here:
http://traderx.blogspot.com/2005/11/trading-faq.html
He does not look at risk in terms of his total portfolio.
TJ
My long trades were MEDI and GILD...MEDI was not great but GILD were real good.
Got in on MEDI on the third 15min. bar and promptly got stopped out on the fourth bar for an .07 cent loss but got another set up with a break of the Ninth NRB Exit was at 27.52 with an .08 cent risk which gave a 3.26:1 ratio including the .07 cent stop loss.
GILD was a fantastic long on the break of the third 15 min. candle at $62.97 and got stopped out at 63.82 on the thirteenth candle with .10 cents risk...not to shabby!
Stops - nasty question. There are sixty three thousand ways to set them but what they all come down to is = how much risk do you want to take? There is no good hard and fast rule to follow. I'd just use a dime per decile after the first dime. So for 1 to 10 dollars it would be a dime and then add a dime every increment after that. So a 20 dollar stock would have a 30 cent stop and so on.
But again that's just a rough rule of thumb and the only thing that matters is how you feel about the trade.
Stops are what every trader has to figure out on their own. Mine are always based on technical levels. I ask myself the question, "at what point was this trade be invalid?"
That is where I put my stop. A lot of times it is the opposite extreme of the candle I enter, other times it is another technical area - for example, a swing high or low, a re-cross above an OR high/low, etc.
I don't agree with just arbitrarily putting a fixed stop on every trade - for example, .30. It doesn't make sense. You have to look at the point where the trade is not longer valid, then adjust your position size accordingly like X talks about in his Money Magt rules.
TJ
Hi John,
Normally you would be right and .27 cents would be the logical stop if you only use the 15 minute charts.
However, many times I use the 3 minute and 1 minute charts also to get an okay entry and tight stop. This backfires on me sometimes also, I think we all get whipsawed every now and then.
In (volatile chopppy markets) like we have seen since May 11th" 'I like to keep my stops very tight on long positions and I loosen them up a bit on short positions. The reasoning is stated above...choppiness(is that even a word)LOL.
I find that in choppy markets" 'short positions tend to be much more fluctuant than long positions. So I look to the left on charts and kind of figure a quick average(if there seems to be a pattern of the near past) of high and low valleys and guesstimate where a good stop would be.
On long positions in choppy sea's I try to set tighter stops...it's just a risk control factor that I use. In very bullish low volatile markets I open the stops up quite a bit. Many traders would tell you that I am NUTS for opening the stops up a little more on short sales but I have found that I get whipsawed much less often and the positions reverse back to my favor in choppy markets. The same holds true for highly fluctuant stocks that look like they are about ready to break down to oblivian.
In the case of GILD my order was filled on the 13th minute bar of the 4th fifteen minute candle at a price of $62.97... I used the 9th or tenth minute bar low of the 4th fifteen minute candle to set the stop at $62.87 for .10 cents risk.
It was a very bullish day in a choppy market. I could have set a loose stop but I know how fast things can change during Options experation week.
One other common method that I would use on a trade like GILD to set a tighter stop would be like this. Using the 15 min. chart... The engulfing bullish but low volume third candle range was from 62.70 to 62.95" 'a .25 cent range.
I would divide that .25 cents by 2 = 12.5 cents, then round up to .13 cents. Now subtract that .13 cents from the high of the third 15 min. candle, 62.95 - .13= $62.82. That $62.82 would be a logical place for a stop but we are not done yet.
Most people think in round numbers so they may place a limit order as low a $62.80 that might get matched and filled by some bastard specialist" 'so I would go lower by .03 - .04 to 62.77 or 62.76 for the stop.
Okay now our order fills at .02 cents higher than the the third bar at $62.97" '62.97 - 62.77 = .20 cents risk" 'get the picture? still .07 cents tighter per share than the logical .27 cent stop.
It takes hundreds of times longer for me to write this than it does to figure in your head and make the trade...Hint" 'I prep the orders and use alerts whenever possible to make life easier. when using 15 min. and 30 min. charts this is very easy to do but when going down to 3 and 1 min. charts it can be a pain in the butt and you have to be quick.
Helpfull hints: Examine some charts of bullish and bearish stocks, look to the left and make pretend long and short trades on both types" 'keep an eye on volume spikes to see where the Pros get in and exit" and where good spots for stops are. You will learn alot from this exercise.
Hope this helps.
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