Let's Discuss Trading Styles

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LelandC

Just wanted to see if anyone is interested in discussing trading sytles. Talk about your style or some other succesful traders styles.

Do you like to trade NYSE or nasdaq or both and why?

Daytrade or swingtrade?

I have often heard people say to find a particular style or set-up that works well and focus on that. Less is more I guess.

Some people only trade one stock day in and day out (ie: GE or IBM, etc).

It seems as though my problem is that I try and watch too many stocks at once and end up missing things that are right under my nose. Some folks only trade a handful of stocks and are successful.

Any one care to chime in?

 
I'm new to daytrading and this is my first posting. Thus my name swingtrader101, to remind myself that I'm always in class! I've been eavesdropping on this message board for about one month and have learned a lot of useful information. Since I've only recently been in a position to seriously follow the market I feel that I have very little to contribute.

I don't trade a lot... five trades so far this week, ten for the month... but am stepping up the pace as I gain confidence. I have only traded a few different stocks (Nasdaq: ORCL, JDSU) and (NYSE: AVX, SAP). There is nothing magical about these choices but by watching them very carefully I am getting a feeling for their behavior. I like the way these NYSE stocks lag their Nasdaq sector counterparts. I'm slowly expanding my watchlist but plan on keeping it small. I'm getting better at picking low risk entry points and most of my trades do show a profit. I keep my losses small by using mental stops. I've been most successful at taking small profits, as I have not yet been able to get a large move in this market.

As we know, some people do very well by focusing on only one stock while others do equally well using a shotgun approach. For now at least I feel more comfortable with a few stocks, as I feel my risk is lower. My account is small, the capital cannot easily be replaced and I need to be careful.

Thank all of you who have shared your experiences, too many of you to list by name!

swing

 
I have a few trading styles right now, the most successful of which in these summer doldrums is P2's "great new pattern". My other two techniques are geared towards scalping futures related issues, but the summer is so slow that they don't move enough for that to be a successful trading strategy right now. I have also been making money with after-hours news plays lately, which gives me hope that the market is getting healthier.

For example today right when PMCS was un-halted I posted a bid at 27.26 for 1500 and got filled instantly. About 20 seconds later I sold it a dollar higher. Post market trading is "amatuer hour" so if you know what you're doing you can take advantage.

If anyone is interested in P2's method come over to the Yahoo chat during market hours.

http://clubs.yahoo.com/clubs/elitetradinginaction
 
Dustin

If I'm not mistaken, you got right in at the bottom on PMCS. I played it too, but I waited until I got confirmation that it was going up before I bought. I'm just wondering how you picked out that price. It seems to me like you could have gotten hit pretty hard had it tanked. I was thinking the same thing you were; this warning isn't so bad; it might come down a couple bucks, and then it should rebound. I just can't imagine placing a bid right after a halt. Have you ever gotten burned doing that?
 
Nice discussion of the many different trading styles so far. Another interesting style I have heard a lot about is buying new intraday highs out of some form of consolidation. I have heard of some folks having hundreds of these positions on at once. Now that is something!!!

 
I saw that the news wasn't that bad, and the only real isld bid at the time was for 1500 at .25, so I chose to throw in a bid a penny higher. I guess it was just a gut feeling.

As another example of ah trading, I traded the AMCC halt a couple days ago. When it was unhalted I got short at 14 by getting the only isld shares (it was luck). Made a buck on those too.
 
Anyone care to list 5 listed stocks they like to trade? Say you could only trade these 5 stocks day in and day out. Which would they be?

 
It seems to me that the two major methods for short term trading are either techical (chart) trading or event,news type trading. I have tried both day trading and swing trading using techical chart analysis. If you use the same entry and exit points based on chart setups then day trading is just swing trading in a compressed timeframe. I find that the disadvantage of daytrading is much higher trading costs and much higher slippage cost. WELL over 50% of any profits I made daytrading where taken by the broker( even with a low cost direct access broker). It is harder to calculate the losses to slippage but I wouldn't be surpised if they were as high or higher than the brokerage fees. If your techical system works it should work in any time frame. If this is the case, swing trading generates better returns per trade. You might get lower annual returns swing trading though because you are making fewer trades over longer timeframes. I continually read stories about scalpers who are making hundreds of thousands per year with that method. So far that seems like fantasy land to me. The one constant that seems to be true with any method of trading used would be the control of risk/reward. Whether you are scalping or swing trading you must make more than you lose to stay in the game.
If you are using techical analysis to find trading setups, what is the advantage of limiting the number of stocks you monitor for setups by having a fixed list of favorite stocks? Any stock that presents you with the setup you are looking for would seem to be a good candidate for a trade as long as it meets your screening criteria and gives you a good risk/reward opportunity. Your setups either work or they don't, it doesn't seem that your intimate knowledge of the stock does much but give you the courage to pull the trigger.

DJC
 
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