Trading stocks with the 15 min chart
- Thread starter inandlong
- Start date
I'm glad you asked.
Yesterday on the reversal short, because of the way the order is handled internally, the PDT rule came into play. The sell order was filled, the short sale was not. The IB acct that I was using for CSCO only has 15K in it.... hence the PDT rule problem.
Looking at the historical chart this is not routinely a problem. But it did cost profits today, profits that would have moved the account into positive territory, profits that were a part of the whole p/l picture and profits that are a part of the historical picture when looking at the chart.
So actually I am flat. But this is just the type of unforeseen circumstance that gets in the way of realizing the profits it looks like you should from the charts. Specifically, many if not most of the times the price crosses on a closing basis and does not cross back, or not so right away, thus avoiding the PDT rule.
The present short position SHOULD be up 22 cents presently, and 6 cents overall.... but more importantly....
.... the illustration of what I am talking about with whipsaws. You know price is going to deviate from the mean, that is why you selected this candidate. Usually price does not crsiss-cross across the mean. That is visually evident from the charts. SO what if it goes criss then cross then criss again before it goes. The profit right now is 6 cents, the profit potential has been 21 cents so far.
Yesterday on the reversal short, because of the way the order is handled internally, the PDT rule came into play. The sell order was filled, the short sale was not. The IB acct that I was using for CSCO only has 15K in it.... hence the PDT rule problem.
Looking at the historical chart this is not routinely a problem. But it did cost profits today, profits that would have moved the account into positive territory, profits that were a part of the whole p/l picture and profits that are a part of the historical picture when looking at the chart.
So actually I am flat. But this is just the type of unforeseen circumstance that gets in the way of realizing the profits it looks like you should from the charts. Specifically, many if not most of the times the price crosses on a closing basis and does not cross back, or not so right away, thus avoiding the PDT rule.
The present short position SHOULD be up 22 cents presently, and 6 cents overall.... but more importantly....
.... the illustration of what I am talking about with whipsaws. You know price is going to deviate from the mean, that is why you selected this candidate. Usually price does not crsiss-cross across the mean. That is visually evident from the charts. SO what if it goes criss then cross then criss again before it goes. The profit right now is 6 cents, the profit potential has been 21 cents so far.
BWAHAHAHAHHAHAHA
So let's just see how it goes.
The position is short at 18.42 from previous and now has a profit of 45 cents, giving an overall profit of 29 cents so far.
Remember though, the trade is on the 15 minute chart and any sustained move is just getting underway. A down trendline can be drawn across the closes beginning with the 14th. That will suffice as the trendline break required to exit the trade prior to the next 200 sma crossover.
Btw, the 60 min 200 sma is coming in to play. Always remember longer time frames require larger loss tolerances.... from the trader, not the trade.
The position is short at 18.42 from previous and now has a profit of 45 cents, giving an overall profit of 29 cents so far.
Remember though, the trade is on the 15 minute chart and any sustained move is just getting underway. A down trendline can be drawn across the closes beginning with the 14th. That will suffice as the trendline break required to exit the trade prior to the next 200 sma crossover.
Btw, the 60 min 200 sma is coming in to play. Always remember longer time frames require larger loss tolerances.... from the trader, not the trade.
Now that the position is on and has moved away from the average, we can "look back" and see what happened, and know that it did happen that way because we were in. The historical data becomes our historical data, and there are no "yeah buts"!
This chart nicely illustrates the whipsaw and how relatively harmless it can be for the properly selected candidate, ie., one that suits your risk tolerance. Selecting the right time frame and the right stock to be able to hold the trade until the bar closes is important, and was demonstrated earlier in this trade the first bar yesterday morning.
The exit is always up to you. The two means of exit I use here are for simplicity, as well as being what I use.
The most important thing to see is that using a moving average as a reason to get in to the properly selected stock WILL put you in a healthy profit opportunity. If you trade a moving average mechanically you probably won't make money.... I don't know. But much of the time during that trade, you will have had the opportunity to take a much larger profit than any loss you incured while waiting for the price to move away.
This chart nicely illustrates the whipsaw and how relatively harmless it can be for the properly selected candidate, ie., one that suits your risk tolerance. Selecting the right time frame and the right stock to be able to hold the trade until the bar closes is important, and was demonstrated earlier in this trade the first bar yesterday morning.
The exit is always up to you. The two means of exit I use here are for simplicity, as well as being what I use.
The most important thing to see is that using a moving average as a reason to get in to the properly selected stock WILL put you in a healthy profit opportunity. If you trade a moving average mechanically you probably won't make money.... I don't know. But much of the time during that trade, you will have had the opportunity to take a much larger profit than any loss you incured while waiting for the price to move away.
The caveat of course is the exit. The methods I am using here are simple. The time frame is short enough to be less affected by market trend than a daily chart, thus affording decent profit potential regardless of overall market direction.
Girlpower, as you said today elsewhere, even the whipsaw is balanced by the ultimate run. And there is a run!
TKO' be sure you are convinced that the method will put you in a healthy profit position. I know you have the skill to make nice exits. One way to begin trading this is to find a nice candidate that has whipped over the last several days, like CSCO did. You can be fairly certain a move is about to ensue. Line up the macd with it and you are good to go.
Girlpower, as you said today elsewhere, even the whipsaw is balanced by the ultimate run. And there is a run!
TKO' be sure you are convinced that the method will put you in a healthy profit position. I know you have the skill to make nice exits. One way to begin trading this is to find a nice candidate that has whipped over the last several days, like CSCO did. You can be fairly certain a move is about to ensue. Line up the macd with it and you are good to go.