long term position trading -primarily etf's-

[sowterdad]

THE SPY chart illustrating examples of bullish price moves under a declining moving average that do not qualify as bullish -exceeding the prior bearish price open.View attachment 150739

ILLUSTRATING THE RESULTS - ENTRY AT THE EOD BULLISH CLOSE.
tHERE SHOULD BE SOME ADJUSTMENT IN ALLOWING TOO LARGE A DECLINE UNDER THE EMA FOR A STOP- OR A PROVISION TO TAKE PARTIAL PROFITS ON A FASTER STOP-
Those are all adjustments a trader could make- it would also require a willingness to take a reentry if the trend continues higher after stopping out-
The initial results of this type of entry/stop are promising-for active trading outperforming BUY and Hold over the same period of time - B&H $00.00 gains YTD. with a net +6.8% gain over these trades- reinvesting the gains as adds to the starting value of $1,000.00 and trading partial shares.

If someone was trading a smaller $1,000.00 position in SPY using this method and a typical discount broker $7 trades- The broker's commissions would eat all of the respectable 6.8% ytd return gained. Commissions count- and add up-

 

[sowterdad]

A subject switch:
Investing;
A few weeks away from APRIL 15- Tax and IRA deadline.
Time to plan to fund ROTH and conventional IRAs for the 2014 calendar year- or miss out on the opportunity.
I understand- We're so involved in the trades we may be putting on this coming week to be thinking about something as abstract and removed and dull- as investing .....
Since this is primarily a site about trading, investment per se may be overlooked as it is much more behind the scenes-and dull..... but it is also very important . I recommend Investing be done regularly -and often- Through the employer weekly if possible, and on your own if you have the discipline it takes.
Some of this thread has touched upon it-Now and then- and elements of investing may seem contrary to active trading.
Investing seeks to mitigate the Risk of overexposure to just a single sector-All of one's eggs in one large basket is dangerous! over a longer time frame- This diversification of assets- called asset allocation- has a sound history - CNBC's Cramer even tries to illustrate diversification by suggesting Investors hold positions in 5 different sectors- Presently, I can recognize this Risk in my own trading in focusing large on Pharma and Biotech. Works until it fails to do so.
Cramer's approach is often US centric and limited-in the diversification he embraces on his show..... but the general principal is very valid that diversification reduces trader's RISK.
When one is focused with a large position on a stock or ETF that outperforms, one can achieve gains that exceed the market- Use AAPL as a recent example- bIG RUN UP, BIG DECLINE- And being All-in- or so overweight one stock or one sector- or one ETF as one's approach will eventually result in an oversized loss or drawdown.
Big money invests in a wide pool of assets- with varying degrees of Risk- or weighting
This is called Asset Allocation- a diversified approach that professional investment firms employ.
Smaller Investors have extraordinary obstacles to achieve this type of diversification on their own- It starts with the cost of commissions and fees that dilute their investments.
I'm a big proponent of low cost passive investing through Vanguard for a method to level the playing field-
Vanguard offers low entry , low fees to open IRA accounts- with No commissions-and some of the lowest fees in the entire industry. For Wide diversification- Vanguard offers low cost Target Funds-
However, If one seeks to have a more diverse approach - i am finding that there exist some more diversified low cost investment options that come with a low cost diversified ETF approach- Wealthfront.com employs many of Vanguard's diverse funds , and offers a no commission management fee that includes periodic rebalancing- something professional investment houses employ.
Wealthfront offers a flat annual fee- It varies slightly on the account value- But all fees are much less tha 1% of AUM- assets under management- to accomplish this- in addition to using very low cost ETF funds -
Wealthfront believes their more diversified asset allocation model will outperform the broader exposure Vanguard offers through their target funds, and will more than make up for their more expensive model over Vanguard over time.
Betterment .com is another site- offering a lower cost- also- wide diversified approach-
Anyone interested in employing any of these agencies needs to do their due diligence-
Wealthfront offers a comprehensive page listing questions as to how the Investor's assets are isolated and SPIC protected- Their model looks valid to me-
Vanguard has been around a long time though-
I'm mulling through these choices as alternatives to where my current IRA funds are in play.

 

[sowterdad]

ILLUSTRATING THE RESULTS - ENTRY AT THE EOD BULLISH CLOSE.
tHERE SHOULD BE SOME ADJUSTMENT IN ALLOWING TOO LARGE A DECLINE UNDER THE EMA FOR A STOP- OR A PROVISION TO TAKE PARTIAL PROFITS ON A FASTER STOP-
Those are all adjustments a trader could make- it would also require a willingness to take a reentry if the trend continues higher after stopping out-
The initial results of this type of entry/stop are promising-for active trading outperforming BUY and Hold over the same period of time - B&H $00.00 gains YTD. with a net +6.8% gain over these trades- reinvesting the gains as adds to the starting value of $1,000.00 and trading partial shares.

If someone was trading a smaller $1,000.00 position in SPY using this method and a typical discount broker $7 trades- The broker's commissions would eat all of the respectable 6.8% ytd return gained. Commissions count- and add up-
View attachment 150740

tHIS IS A 2 HOUR CHART WITH A FAST MOVING AVERAGE.
nOTE- ON THE PRIOR POST CHART- A BULLISH ENGULFING CANDLE -F- WAS ILLUSTRATED.
THE ENTRY ON THAT DAILY CHART SUGGESTED TO ENTER ON A BULLISH PRICE REVERSAL CANDLE GOING INTO THE CLOSE- WHEN PRICE WAS HIGHER THAN THE PRIOR DAY'S OPEN.
IN THIS 2 HOUR CHART, THAT SAME DAILY CANDLE ( F ) IS NOW BROKEN INTO 4 SEGMENTS ON THE 2 HOUR CHART. iT IS FOLLOWED BY A DAY THAT DECLINES, AND THEN A SUGGESTED BUY-STOP ENTRY HIGHER ABOVE THE F DAY.

Price hits resistance, declines, and the trader that entered at F or just after, would have had to take a quick profit on a raised stop - else he rode this thing back down and finds his profitable trade is now possibly losing.
With the present condition, the 2 hr chart indicates price has not really made a reversal- but is making a sideways consolidation- Since the prior price bar was narrow- and present price bar is also- The fast ema has not been reversed, price is sideways, Buyers are in consideration mode- and not yet bullish or bearish. It is a 'wait and see' moment according to these narrower bars. That may all change for the better-or worse- Tomorrow- Monday-
or this coming week. Earnings are coming.
A quick analogy:
A trader can be seen as a hunter- The fast novice anxious hunter ( I was one) takes
a shot early, before the quarry is in full view. That Hunter really wants success- to have fullfillment in the Hunt- but his anxiousness to bag that quarry causes him to take a shot that is perhaps too early. That fast hunter may indeed hit the quarry, but send it off wounded- and end up empty handed.
The more patient hunter may wait a bit- and make fewer shots- but has the quarry in better view- and harvests a higher percentage of his shot.
As a novice Bow and Arrow deer Hunter these past 5 years- I can attest to better success when the quarry is more easily targeted.

 

[sowterdad]

tHIS IS A 2 HOUR CHART WITH A FAST MOVING AVERAGE.
nOTE- ON THE PRIOR POST CHART- A BULLISH ENGULFING CANDLE -F- WAS ILLUSTRATED.
THE ENTRY ON THAT DAILY CHART SUGGESTED TO ENTER ON A BULLISH PRICE REVERSAL CANDLE GOING INTO THE CLOSE- WHEN PRICE WAS HIGHER THAN THE PRIOR DAY'S OPEN.
IN THIS 2 HOUR CHART, THAT SAME DAILY CANDLE ( F ) IS NOW BROKEN INTO 4 SEGMENTS ON THE 2 HOUR CHART. iT IS FOLLOWED BY A DAY THAT DECLINES, AND THEN A SUGGESTED BUY-STOP ENTRY HIGHER ABOVE THE F DAY.

Price hits resistance, declines, and the trader that entered at F or just after, would have had to take a quick profit on a raised stop - else he rode this thing back down and finds his profitable trade is now possibly losing.
With the present condition, the 2 hr chart indicates price has not really made a reversal- but is making a sideways consolidation- Since the prior price bar was narrow- and present price bar is also- The fast ema has not been reversed, price is sideways, Buyers are in consideration mode- and not yet bullish or bearish. It is a 'wait and see' moment according to these narrower bars. That may all change for the better-or worse- Tomorrow- Monday-
or this coming week. Earnings are coming.
A quick analogy:
A trader can be seen as a hunter- The fast novice anxious hunter ( I was one) takes
a shot early, before the quarry is in full view. That Hunter really wants success- to have fullfillment in the Hunt- but his anxiousness to bag that quarry causes him to take a shot that is perhaps too early. That fast hunter may indeed hit the quarry, but send it off wounded- and end up empty handed.
The more patient hunter may wait a bit- and make fewer shots- but has the quarry in better view- and harvests a higher percentage of his shot.
As a novice Bow and Arrow deer Hunter these past 5 years- I can attest to better success when the quarry is more easily targeted.View attachment 150758

With all the markets moving higher 1% + across the indexes, there is a lot of similarities in the charts-
The 1st chart i have time for is TQQQ- the ultra q's - higher - and biotech is higher as well- helping this TQQQ rally today.
SSO - SPY is higher-
Financials- UYG are higher.....
PJP is higher- but in a tight pattern- I think it sets up well to add to the position on a higher move- I would favor buy-stop entries for most of these trades- because -if it moves, it likely will be trying to catch up on the sell-off of the past week.
Does this mean this will be the end of the market's decline? caution? We can never tell what will move the market . However, when all sectors are moving higher- That's the TIDE- and don't fight it - Flow with it- keeping in mind that tides change- ebb and flow.
Do we get back to the recent highs is the solid question to ask. Will we rally higher than that? There is no way to tell what will occur. The market chooses what it gives significance to -
The rolling price action of this 2015 year may have benefitted faster day traders-
But trend seeking Swing traders have had a tough go.
I have a "full" position in the trading account- presently in PJP- 30 @ $76.93 =$2373.00 It set up in a tight consolidation today, and i will use a Buy-stop to add 30 shares - doubling this position- and using the recent swing low as the basis to evaluate a stop-loss. My simple Bias is that if the Market goes higher- this will outperform and is
A less volatile vehicle compared to Biotech. Since it is not leveraged, it does not have any decay due to End of Day rebalancing.
I justify this smaller egg basket by employing tighter stop-losses.
The recent swing low IS the Line in the Sand.

I also hold PJP outside the IB account, and TQQQ.as well. Separate account with an attempt to see if i can stomach and apply a wider time frame approach (larger volatility, drawdown) .
As i looked at some of the charts- and you measure the recent declines from the highs-SSO went from 135 down to 126- 9 points or 6.7% move.
SPY went from 211 to 203.50= 8.5 points = 4% For shorter term holding periods,
it is hard to capture a gain in a tighter window of price movement.
I would be more inclined to Trade the Ultra- rather than the regular index ETF. (SHORTER TERM) The Ultra is 2x - and i would stay clear of the 3x for the many issues of rebalancing- and much greater volatility. One can also reduce the position size -how much one purchases- because of the added leverage. As with all things on ET- Each trader should do his own DD
to see if information presented is actually valid in the real world application.

This is the dangerous part- From what i am hearing tonight- and with the indexes all appearing to rally across the boards- I think this is a Buy Buy Buy- to paraphrase Cramer-
But, be prepared to tighten those stops on weakness- It would be nice to take 1/2 off as price approached prior upper resistance, allow 1/2 the trade to run with a stop above the entry- just in case it actually breaks higher- I will use Buy-stops on my orders- forcing a n order to move higher before it gets filled. View this Buy-Stop as not trying to be a bargain hunter getting a discount- Instead, The Buy-Stop is a higher price (usually) than the closing price- You want to see that the momentum is continuing and that Buyer's are stepping in, paying more. The Buy-stop extra higher cost is perhaps an insurance premium of sorts- but not an option .....One day I may learn about Options.....but i was led to believe you need to be a consistant regular trader before moving on to options trading........
TQQQ chart

 

[sowterdad]

Not much to brag about since starting this thread in trading results- but the year is young and I am still optimistic. What counts here is not the actual dollar amount- but the % account gained or lost over these trades-
The market has been relatively flat for the year up to today's rally higher.
My account value trails the market- and i am down slightly. I'll use the SPY as my benchmark index. not the $spx.
At today's market rally, i think there is potential for some higher upside since all sectors tried to lock in over +1% gains- So, i am being aggressive and placing Buy-Stop orders with % trailing stops attached to each trade and very high limit sell orders as well.These attached secondary buy-sell orders can be adjusted as one sees fit- They are referred to in the IB order as "Bracket Orders" and very nice to save time on the initial trade order.

The ability to attach these limit stops and sell orders with the initial order is not available on all discount brokers- Thank you IB for this functionality.

On periodic occaisions- I will post a screenshot of the IB account- I think I did so earlier in the thread- I would enjoy posting the screenshot of the 20% gain i made in the past 3 months! LOL- Unfortunately, I am about Par with the market slightly down -1% or so yet. - but today's orders are aggressive- in their selection- with some leverage & momentum positions desired to be filled.
The rationale for these actions is the market's across the board move higher today- I hope we see 3-4 days of positive reaction to the prior sell-off. This would float my boat higher.

The Buy-Stop entry requires that price will indeed move higher in order for my orders to fill.
The limit will ensure that i don't get filled on a very wide gap high open.
The attached trailing % stop is something i am just starting to test out- I want to be clear of average volatility swings- Some of these stops may be simply too narrow a %.We will see what occurs......

 

[sowterdad]

Not much to brag about since starting this thread in trading results- but the year is young and I am still optimistic. What counts here is not the actual dollar amount- but the % account gained or lost over these trades-
The market has been relatively flat for the year up to today's rally higher.
My account value trails the market- and i am down slightly. I'll use the SPY as my benchmark index. not the $spx.
At today's market rally, i think there is potential for some higher upside since all sectors tried to lock in over +1% gains- So, i am being aggressive and placing Buy-Stop orders with % trailing stops attached to each trade and very high limit sell orders as well.These attached secondary buy-sell orders can be adjusted as one sees fit- They are referred to in the IB order as "Bracket Orders" and very nice to save time on the initial trade order.

The ability to attach these limit stops and sell orders with the initial order is not available on all discount brokers- Thank you IB for this functionality.

On periodic occaisions- I will post a screenshot of the IB account- I think I did so earlier in the thread- I would enjoy posting the screenshot of the 20% gain i made in the past 3 months! LOL- Unfortunately, I am about Par with the market slightly down -1% or so yet. - but today's orders are aggressive- in their selection- with some leverage & momentum positions desired to be filled.
The rationale for these actions is the market's across the board move higher today- I hope we see 3-4 days of positive reaction to the prior sell-off. This would float my boat higher.

The Buy-Stop entry requires that price will indeed move higher in order for my orders to fill.
The limit will ensure that i don't get filled on a very wide gap high open.
The attached trailing % stop is something i am just starting to test out- I want to be clear of average volatility swings- Some of these stops may be simply too narrow a %.We will see what occurs......View attachment 150787

In the premarket-
Europe sold off today- profit taking- Concerns about CPI there-China-
Europe is up 16% YTD while the US SPX has been flat. Might be all about the lower PE valuations & being oversold compared to the US. I should be looking at including an ETF that would give exposure to Europe with upside momentum-
US Futures are also down this 5:30 am- suggesting some selling pressure-
Since my orders for entry are Buy-stops, with price needing to go higher to be activated, I will leave evertything as-is.
We'll see how much profit-taking occurs today, and whether this market will be able to move higher.

 

[sowterdad]

Not much to brag about since starting this thread in trading results- but the year is young and I am still optimistic. What counts here is not the actual dollar amount- but the % account gained or lost over these trades-
The market has been relatively flat for the year up to today's rally higher.
My account value trails the market- and i am down slightly. I'll use the SPY as my benchmark index. not the $spx.
At today's market rally, i think there is potential for some higher upside since all sectors tried to lock in over +1% gains- So, i am being aggressive and placing Buy-Stop orders with % trailing stops attached to each trade and very high limit sell orders as well.These attached secondary buy-sell orders can be adjusted as one sees fit- They are referred to in the IB order as "Bracket Orders" and very nice to save time on the initial trade order.

The ability to attach these limit stops and sell orders with the initial order is not available on all discount brokers- Thank you IB for this functionality.

On periodic occaisions- I will post a screenshot of the IB account- I think I did so earlier in the thread- I would enjoy posting the screenshot of the 20% gain i made in the past 3 months! LOL- Unfortunately, I am about Par with the market slightly down -1% or so yet. - but today's orders are aggressive- in their selection- with some leverage & momentum positions desired to be filled.
The rationale for these actions is the market's across the board move higher today- I hope we see 3-4 days of positive reaction to the prior sell-off. This would float my boat higher.

The Buy-Stop entry requires that price will indeed move higher in order for my orders to fill.
The limit will ensure that i don't get filled on a very wide gap high open.
The attached trailing % stop is something i am just starting to test out- I want to be clear of average volatility swings- Some of these stops may be simply too narrow a %.We will see what occurs......View attachment 150787

 

[sowterdad]

Well,
Between starting this post and a late dinner- and returning to the post- the time expired,
Synopsis-
None of my Buy-Stop orders filled- This order type did exactly what it was intended to do-Insurance that worked today- doesn't always happen like this....
Instead of trying to Buy something cheaper - I wanted to pay a bit more to ensure there was additional perceived higher value when I purchased. does not always work out this way-
but this is a good example of 5-6 trades left unfilled that all went lower. That - IMO is smart trading- spend a little on a higher entry price- to save a lot on getting trapped in a declining price.
It now gives me the opportunity to rethink the entry/ cancel the trade- stay with the trade- Presently, I am more cautious of this market than ever, so I will allow these higher entry levels to remain, and not try to jump in as a value buyer yet- even at lower prices.
There may be a few persons reading this thread that jumped in during yesterday's bullish price action, held overnight, and found themselves in a losing position at the market open as everything gapped lower and then declined. If you stopped out today- good trading -
If you happen to be holding a long position still- ask yourself where will you stop-out?
You should already know where that is and it should be an established number.
How does that trade affect your portfolio value? 2%, 5%, 10%?????? It's your choice- not mine. What is right for the Reader- may not be what i think is right for me-
For newer traders:
Push HOPE out of the co-pilot's seat, Man up - make the decision- do the basic math and - if a further decline is coming-or a Rally - you will have acted responsibly according to your planned trade.
It starts with a Decision. And a Plan for your trade- And - take the time to understand the basics of Position Sizing- Be a Survivor- Stay solvent- trade another day. Time is on your side only as long as you do not get in too large a hurry - Earn slowly - while you learn more- would be my thoughts to newer traders reading this thread. If you 'survive'- and trade another day- and another day- you have years ahead-
If you Risk too much- and blow out your account - You not only fail to give yourself the opportunity to learn more- to adapt- to grow- you perhaps don't recover from the setbacks at all. Financially, Psychologically.
Day's like today - make one wonder what tomorrow will bring.
Saw this Bright Note today-
http://www.cnbc.com/id/102548160

 

[sowterdad]

Well,
Between starting this post and a late dinner- and returning to the post- the time expired,
Synopsis-
None of my Buy-Stop orders filled- This order type did exactly what it was intended to do-Insurance that worked today- doesn't always happen like this....
Instead of trying to Buy something cheaper - I wanted to pay a bit more to ensure there was additional perceived higher value when I purchased. does not always work out this way-
but this is a good example of 5-6 trades left unfilled that all went lower. That - IMO is smart trading- spend a little on a higher entry price- to save a lot on getting trapped in a declining price.
It now gives me the opportunity to rethink the entry/ cancel the trade- stay with the trade- Presently, I am more cautious of this market than ever, so I will allow these higher entry levels to remain, and not try to jump in as a value buyer yet- even at lower prices.
There may be a few persons reading this thread that jumped in during yesterday's bullish price action, held overnight, and found themselves in a losing position at the market open as everything gapped lower and then declined. If you stopped out today- good trading -
If you happen to be holding a long position still- ask yourself where will you stop-out?
You should already know where that is and it should be an established number.
How does that trade affect your portfolio value? 2%, 5%, 10%?????? It's your choice- not mine. What is right for the Reader- may not be what i think is right for me-
For newer traders:
Push HOPE out of the co-pilot's seat, Man up - make the decision- do the basic math and - if a further decline is coming-or a Rally - you will have acted responsibly according to your planned trade.
It starts with a Decision. And a Plan for your trade- And - take the time to understand the basics of Position Sizing- Be a Survivor- Stay solvent- trade another day. Time is on your side only as long as you do not get in too large a hurry - Earn slowly - while you learn more- would be my thoughts to newer traders reading this thread. If you 'survive'- and trade another day- and another day- you have years ahead-
If you Risk too much- and blow out your account - You not only fail to give yourself the opportunity to learn more- to adapt- to grow- you perhaps don't recover from the setbacks at all. Financially, Psychologically.
Day's like today - make one wonder what tomorrow will bring.
Saw this Bright Note today-
http://www.cnbc.com/id/102548160

looks like continued weakness. PJP position is declining. TLT is rising-gapped up from the lower range at the open. I was considering a purchase, but would like to see it pull back some 131.50 limit as i take an unusual opportunity for a morning break 10:29 am. (different account)
HEDJ - hedged Europe has been doing well-THE past 3 months. nice gain-No position on my part- but it points out that I should/could widen my rather narrow horizon -universe.
Big headlines-Investors Flee Market
http://www.cnbc.com/id/102541062.
I am primarily in all cash in the Investment IRA- coincidental to getting ready to roll it over to a Vanguard account. Small amount in a bond funds and minor small amounts in some equity-I don't have much fear that I will miss out on a big market rally-
90% in cash there-
PJP is breaking lower. It holds up relatively well, but follows the market direction overall.
Often the market get's weak in the 2nd qtr- this may be the early lead into that weakness. Carter Worth -technician has been bearish on equities for the past year.
Eventually, he may get the more significant correction he is expecting-
I will look this pm to see if I have the willingness to take a short trade.
Look at the big intraday spike in UVXY yesterday. In a very short time it popped higher in a 2 hr bar, but opened back low on the 3rd. For aggressive day traders- that would have made for a nice day if they were able to sell on that move-
If one watches the UVXY on a real time tick chart- it likely is a good barometer of where the market direction wants to go intraday.
As a spec trade- I just entered a buy-stop $15.50- limit $15.70 50 shares-
Unfortunately, this is in a separate account from IB and i cannot attach my sell order until the position actually fills-stop will be $14.20. If the market declines- UVXY should rise.
If it rally's Uvxy falls.
Break is over...

 

[sowterdad]

looks like continued weakness. PJP position is declining. TLT is rising-gapped up from the lower range at the open. I was considering a purchase, but would like to see it pull back some 131.50 limit as i take an unusual opportunity for a morning break 10:29 am. (different account)
HEDJ - hedged Europe has been doing well-THE past 3 months. nice gain-No position on my part- but it points out that I should/could widen my rather narrow horizon -universe.
Big headlines-Investors Flee Market
http://www.cnbc.com/id/102541062.
I am primarily in all cash in the Investment IRA- coincidental to getting ready to roll it over to a Vanguard account. Small amount in a bond funds and minor small amounts in some equity-I don't have much fear that I will miss out on a big market rally-
90% in cash there-
PJP is breaking lower. It holds up relatively well, but follows the market direction overall.
Often the market get's weak in the 2nd qtr- this may be the early lead into that weakness. Carter Worth -technician has been bearish on equities for the past year.
Eventually, he may get the more significant correction he is expecting-
I will look this pm to see if I have the willingness to take a short trade.
Look at the big intraday spike in UVXY yesterday. In a very short time it popped higher in a 2 hr bar, but opened back low on the 3rd. For aggressive day traders- that would have made for a nice day if they were able to sell on that move-
If one watches the UVXY on a real time tick chart- it likely is a good barometer of where the market direction wants to go intraday.
As a spec trade- I just entered a buy-stop $15.50- limit $15.70 50 shares-
Unfortunately, this is in a separate account from IB and i cannot attach my sell order until the position actually fills-stop will be $14.20. If the market declines- UVXY should rise.
If it rally's Uvxy falls.
Break is over...View attachment 150841 View attachment 150842

Got filled later on UVXY $15.48 - looking for additional market volatility to push this higher-
I'm risking about $70 on this trade-
Cancelled all of my prior Buy-stop orders-
Still holding 30 PJP - but tightened the stop-loss-
The question is -What will propel this US market higher/
Glad to hold a larger cash position at the present time.