Quote from Gordon Gekko:
Jack,
Many of us, including myself, need an answer to the following question.
The winners generally take care of themselves. However, some of us are having difficulty recognizing the losers fast. I am talking about your rocket trades.
Could you tell us, SPECIFICALLY, how you exited today's (3/7) opening rocket trade? On the 5 min. chart, there was a rocket short around the open. If you did not enter a short here, tell us why. If you did enter short, PLEASE tell us how you exited.
This is the KEY for us. As I said, the winners take care of themselves. The problem is getting out of rocket failures, like today's opening trade.
Please answer.
Winners do take care of themselves for sure.
I think we have had many days of flat markets. So we have had many great opportunities to take care of learning a lot of stuff.
The four major things are noted.
Today's open is a very important one to have down once and for all. Aside from the source of this mess, we need to know how to handle all opens for every day anyway. Overnight news always impacts. In this case there was profound stuff in the evening and the schedule for Friday was going to have high impact too.
The general rule is to let the market synch before we enter. This is an end effect issue for all: beginners, intermediate and advanced.
If you watch the cash and index futures synch everyday before entering you are very well served for steadily making money. I can see some comments here carry a sort of theme of intensity or whatever. This is something to get past by having an attitude of steadily making money as time passes.
Everyday is going to start the same way for us. Get the end effects out of the way. We have durations of 14, 13, 10, and 5 bars to get past from the prior day. But this is not the primary end effect; the discontinuity of data is more important as one part and the lack of agreement of cash and index is the other.
We formally recognize this and operate accordingly. Our job is to make money flawlessly, steadily and with an increasing number of tools to do it with.
No one is able to start off fully equipped to do an excellent job. So our alternative is to do an axcellent job in a simple low risk easily defined place to have continuing success.
I feel we have done this and done it well under very flat market conditions. Everyone is doing well that is being thorough and letting go of past feelings and some knowledge that was inapproporiate.
Now just put in the picture what is done every morning at the open. Let the market synch by watching the csh and index values on the NYSE, or something you choose, come into price synch The formations on the 1 min will do this for you. This will happen coincidently after the 14,13, etc have passed to carryover from the prior day.
You can seethe Stocs working here today on the 1 min. See how the gap is wiped out and the day begins with a long trend. The very rapid rise of the Stoc lines to the 80 show this at the respective periodicity, 5 first, 10 second and 14 last.
Aftr viewing the synch on the 1 min, go back to the 5 min and prepare for the day.
You have a 1 1/2 hour "long" trade so far today.
I do see the market all over the place as a consquence of forces of news. When you are a pro at this, you will see very clearly all the means to really clean everyone's clock on this open. There is a true set of functions related to price and volume which will not let you down when I get you to that point.
Summary:
There is never a trade within 12 to 15 mins of open. You always get out of a failure to rocket, as a beginner with a "wash" (flat) trade. Once you are an intermediate, for now, you ride icebergs until they are extinguished by an iceberg on the other side of the trade.
today you entered long on the rocket after 11:00am when it started. For those looking inside the tape (20/80) you can see as an advanced trader that it was a BO off the 50% on the 14,1,3 Stoc.
