Spydertrader's Jack Hershey Equities Journal II

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Quote from qed:

Caught ANDE and PEIX this morning. Just added to ALJ. Anyone else biting?
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Nice trades. I continue to hold RNOW, and added ASCA this morning. Same type of 'out of the box' trade as RNOW. Small size on both, as these two companies represent test trades.

- Spydertrader
 
Question for Spydertrader -

I am always a little baffled by stocks that rise in price off the bottom of a channel with low volume and even lessening volume. It always keeps me out of a trade.

RNOW appears to be climbing nicely that last few days but within dryup type volume and no real volume increase. Today for example it is at the bottom of the list of unusual volume - with nice price gains.

Can you give me your take on stocks that do this? Is it a postive sign to see price increase in dryup?

Thanks for insights.
 
In ANDE @ $36.60

In MGPI @ $22.52

In ALJ @ $28.75

Still holding OMNI from 11-03 @ $9.13.

I realize that I shouldn't have taken the OMNI trade due to earnings release - oops. However, since price didn't breach the RTL of my channel, I continued to hold it. It looks like the time is running out on it though...
 
ANDE and PEIX were just election day plays for me. Neither were in uptreands. ENER is my out of the box play. This concept of unusual volume ha helped me immensely. I have been trading for years with no real way to gauge intraday volume. I'm beginning to see the light.
 
Quote from OpenTrader:

Can you give me your take on stocks that do this? Is it a postive sign to see price increase in dryup?
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Jack has felt in the past that seeing a stock move higher on low volume is a good sign. For me, I don't much like to play with those stocks that we sometimes see move up a dollar on only 8000 shares traded for the day. For me, low volume implies increase risk.

With RNOW, I entered with smaller size in an effort to mitigate the risk of entering on low volume. I didn't expect RNOW to shoot to the moon right away. Rather, I expected price to creep higher (with a possible occasional pullback along the way) until price reached a point where a large volume influx would rapidly improve price. The RNOW trade focused more on the repeatability of a set up based on channels, price and the MACD. So far, it continues to work out as anticipated.

Keep in mind the different strategies at work with respect to which methods one uses to trade. A beginning trader should focus on trading where money velocity increases the fastest in order to trade in the lowest risk areas. We mark these high money velocity areas by noting when volume influx increases at a rate which results in FRV Levels being met or exceeded by end of day. As one increases in experience and in understanding, stretching the envelope, in an effort to capture an improved percentage of the price run, becomes more applicable.

I have a few more tests to run before I can enter with greater size on these RNOW and ASCA type trades. However, on a day when the market has headed south, it is nice to see both trades in the green.

- Spydertrader
 
Stopped out of MGPI @ 21.67 (Ross' rule invoked)

$ .85 loss per share.

At the time of entry, I didn't recognize that we were in a IT down trend, and the move up was a non-dominant traverse.

Better channel drawing is the order of the day.
 
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