Spydertrader's Jack Hershey Equities Journal II

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Hey it happens. At least it's only 2%. I used to let my losses run until I "got the religion" and put in stops and left 'em there.

Besides, nothing says you can't re-enter a position after being stopped out. After all the stock still falls into the "high quality universe" of stocks and still exhibits the correct cycling characteristics.
 
Quote from stevegee58:

Hey it happens. At least it's only 2%. I used to let my losses run until I "got the religion" and put in stops and left 'em there.

Besides, nothing says you can't re-enter a position after being stopped out. After all the stock still falls into the "high quality universe" of stocks and still exhibits the correct cycling characteristics.
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Very true Sir,

for me the problem is the time zone. I am down under, and its 1:30AM at US EST 11:30 AM and I am unable to monitor the market after this time for the re-entry...

need to find a workaround for my particular situation... thanks for the input.
 
I've been trading forex along with stocks and found that I miss out on lots of action during the European markets (I'd have to get up at 3 AM). On the other hand, Europeans get to come home from their day jobs and trade the US markets!

Sounds like Europe is the place to be for trading currencies and securities, at least time zone wise.
 
For the traders that are using channels in there evaluation to enter a trade, do u treat your entry differently when the stock is in an uptrend as opposed to a downtrend? If so, what things do u do differently for a stock currently in a downtrend, but showing all the positive signs of having another run up in price.
 
@gpzany

I'm still quite new to the Hershey method, but in my opinon entering the trade on COGO was risky.
I had a look at it yesterday evening and regarding the Hershey method you would have entered when the stock had risen something about 7% from the opening level already.
I don't really know how the Hershey stocks "behave", but for a stock that made 7% in 2 hours there is a great chance that it will go down again for some percent as people take out profits (it may then continue to rise of course).
So in my opinion, entering at that level with a 2% stop loss has a great risk of being stoped out.
The second problem was, that at that point the stock was already at the top of it's channel, so in addition to the chance that it would go down a bit due to it's rapid rise, there was also the additional risk that it would bounce of the top of the channel (which it actually did).
 
I was doing some science experiments with different watch lists besides the Hershey Final Universe, just to see what came up. I had some interesting results.

1) Of the S&P 500 stocks, only one had rank and that was GM.

2) Of the Nasdaq 100 stocks, *none* had rank.

3) Of the IBD 100 (a watch list maintained by someone on the Wealthlab web site, updated this past Saturday) 14 had rank. Of these 14, EZPW, IIIN, JOBS, LMS, and NEU are in common with our Hershey Final Universe.

I haven't had a chance to look at these IBD stocks in terms of price, float, etc but this looks like a fertile source of stocks for the Final Universe.
 
Quote from RXT:

@gpzany

I'm still quite new to the Hershey method, but in my opinon entering the trade on COGO was risky.
I had a look at it yesterday evening and regarding the Hershey method you would have entered when the stock had risen something about 7% from the opening level already.
I don't really know how the Hershey stocks "behave", but for a stock that made 7% in 2 hours there is a great chance that it will go down again for some percent as people take out profits (it may then continue to rise of course).
So in my opinion, entering at that level with a 2% stop loss has a great risk of being stoped out.
The second problem was, that at that point the stock was already at the top of it's channel, so in addition to the chance that it would go down a bit due to it's rapid rise, there was also the additional risk that it would bounce of the top of the channel (which it actually did).
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Hi RXT,

interesting comments... I agree, COGO had risen a fair bit when the Hershey trigger occurred, but if I remember correctly, it was nowhere near the top of the channel that I had drawn....

This is an issue with the Hershey method, that there is quite a large discretionary component to it. Nowhere in Spyder's rule set does it say that this stock should not have been entered due to its prior advance, there is only the gap rule.

So we may need to go over our failed trades and create our own filters to limit risk further...

Thanks for your comments.
 
Quote from gpzany:

This is an issue with the Hershey method, that there is quite a large discretionary component to it. Nowhere in Spyder's rule set does it say that this stock should not have been entered due to its prior advance, there is only the gap rule.

So we may need to go over our failed trades and create our own filters to limit risk further...

Thanks for your comments.
More...

I just finished reading through the journals and somewhere in Journal II it was pointed out the looking at the channels will increase profitability.
I think someone has analyzed spydertraders trades and found out that a fair amount of his profitable trades happened when the price was near the bottom of his channel (and therefore had enough space to rise) and on the other side a lot of his misstrades happende when the price was near the top of it's channel.

So yes, also in my opinion there is quite a big discretionary component in this method (at least if you want to make good profits).
 
GS19, thanks for sharing.
It seems from reading some of the posts that there is a certain degree of discretionary determination, maybe based on personal preferences as well as the type of methodology used. Am getting that there are multiple approaches Hershey has provided.

Thanks.
 
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