Trading the markets as a daytrader

I am slowing down posts to almost "NIL " starting today but i had to respond to the post from rwk.

"JUST DO IT", sounds great for a tennis shoe commercial or something like that. But for a daytrader to just do it without a plan imprinted on the brain is not how we "JUST DO IT".

It took hard work and years of practice to get "AUTOMATED", the automation indeed requires a set of MANY rules signals etc. But i assure you it is repetitive from nothing less than an intensive learning experience ....

I do not mean to criticize, surely you mean well.

I have gotten where i will be spending more time reading these forums to see how some things change and others never will..:D

How is this just for a laugh: I read "The logical Trader' because from reading some spots in the forum Mark Fishers ACD and pivot ranges, moving averages etc sounded a "LOT" like my way of trading. Well his book felt right at home, because it is almost as if i helped him write it, which i did not...:D

It was amusing to read about a winner trade almost as i do and never knew it. That to me was and is enjoyable, mainly because i never thought my ideas were original. i have stated for years that the so called answers to trading have been in print for years, you just "MUST" figure it all out on your own.... Mark has a "SWELL" simple plan, IT WORKS for me with a few modifications of my own. Thanks for the enjoyable reading and good trading to all.
 
One more comment: Well thought out trades are trades that put you "INTO STRENGTH for LONGS" and PUT YOU INTO WEAKNESS FOR SHORTS", that sounds like a simple cliche but it requires no opinion trading and no such thing as counter trades, counter trades are pure guesses. BY BY
 
Your comment brought a :) to my face as I recalled similar experiences in school. I'm also reminded of a joke which invoves a mechanic asking a surgeon why he gets paid so much more when they do pretty much the same thing (except he works on cars, instead of bodies). The surgeon replies, next time, try overhauling the engine while its still running.

A lot of times trading is taught in a vacuum of hindsight and cherry-picked examples (the engine isn't running). That's why there are only very few masters who will trade live in front of an audience: Tony Oz, Larry Williams, Cook and I think LBR.

The name of the game still is pattern recognition. But the secret is to make the pattern as simple as possible (but not simpler!). I have a passion for simplicity and minimalism that extends to trading. This is why I detest convoluted 'systems' which try to pass complexity off as genius.

Recently, I entertained the heretical idea that volume does not matter:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=54106

I may change my mind in the future, but I still think it does not matter. Especially intraday.
 
stock was moving up at yesterday's close. strong move in the morning. consolidation into lunch painting a small descending triangle with support around .63 as volume decreases during lunch hour.... i'm bias to long side given comments about reversal set-up on daily and intraday uptrend, so ill go long near support with a very tight stop, add on the upper TL break, or just sit and wait for trendline break & volume indications. long entry assumes indicies are strengthening, showing reversal or BO patterns & overall market is not showing signs of weakening. if the overall market is weak, id wait for the TL break to go long, or i might pass depending on circumstances... SMH, scan main component stocks to see how they set-up.

or if you are really nervous, you can wait for a new HOD to go long, but id rather get it earlier if i can get a tight stop.

p.s. im not a pro

good luck:D
 
Quote from Investorsources:

...You see, that is the problem, taking what people say on these boards and making it tangible. Look, no one is going to teach anyone how to trade, any idiot knows that, but it would be nice to hear someone’s opinion on a day where things are strong, but yet no real pattern exists to trade...
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First of all, I'm sure you realize that in person mentoring/tutoring as in your professor analogy is not a comparable to reading something from someone behind a screen name at this message forum that types a few messages...

Not even close.

Therefore, if you have difficulty in understanding something that someone has said at this forum or any other online source...

Don't hold your breath in waiting for them to go into more details or provide more clarifications when you have not asked any questions...

I only say the above because you can't remember the name of the thread nor have a direct link to it

...In that thread there was a chart with an example of what the person was talking about. I cant remember where the thread is...

My point...if you want to truly learn and comprehend something from this forum...

Your going to need to get involved with the thread starter or involved with the author that wrote something your interested in and not go elsewhere looking for answers...

It's an ongoing process.

Simply, if that was a professor...the prof would have provided you with more than just one chart example, would reply to your direct emails, would reply to your direct private messages et cetera...

Not doing such...increases the odds for you to interpret something incorrectly and/or walking away with the feeling as you quoted so well...

Everyone talks a good game but when it comes right down to it, there is nothing tangible and concrete about what they are saying.

Therefore, get involved and don't expect someone to hand to you on a silver platter without you raising your hand (pun intended).

With that said...

You got some replies to your questions about SMH.

The ball is now in your court because you now have the opportunity to get involved with any of those authors that gave you a reply.

If you don't do any follow-ups (ongoing process)...

You will once again have that feeling...

Everyone talks a good game but when it comes right down to it, there is nothing tangible and concrete about what they are saying.

Last of all, that professor you made an analogy to is on salary (getting paid to educate his/her students) and has passed some sort of exam or requirement to be in a position to educate you.

Reading stuff at EliteTrader.com forum from someone that's using an alias without seeing them apply it in realtime or in person...

Needs to be taken with a grain of salt.

P.S. Your at a disadvantage already in your process of learning to day trade because your SMH chart example is missing some data info (something wrong with your chart) between 0930am - 13:15pm.

http://www.elitetrader.com/vb/attachment.php?s=&postid=883777

I had to look at my own SMH to do a proper analysis of the price action.

NihabaAshi
 
Quote from Investorsources:

Well do you see any trends at all that day that would have signaled a buy or sell in your opinion. The example in the middle of my first post was very easy to understand, but also ideal. The example of the SMH yesterday, was not an ideal trading day, in my opinion. If you have another opinion on that I would like to hear it.
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Here's my take on SMH (note that I'm using 15 min chart not 5 min). Green denotes a buy stop to enter. Red is stop loss. Brown square is exit (I don't like engulfing down bars like that).

For info on why that entry/stop loss, etc. see:

http://www.elitetrader.com/vb/showthread.php?threadid=54717
 

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Quote from hypostomus:

There is an inverse Gresham's Law at work on ET: my bad advice will draw in good. That advice? If you want to daytrade, trade index futures. Stocks are far too susceptible to marketmaker and insider shenanigans and manipulations. The major indices are far less so. Plus you have the advantage of enormous liquidity, low commissions, fast fills, and low slippage. And there is no dearth of excellent bad advice here on how to trade them.
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lets not forget government intervention at random, be it by providing daily,weekly data to accomodate the governments agenda. ( a strong economy) of late the stock market is running on emotion and not factual data . in my opinion.

w
 
Quote from Investorsources:

...Have a look at this snapshot for example. I currently own this stock myself but I dont daytrade it, because I dont know how and am not currently set up to do so. I will in the short term future be set up to do so, but until I learn to daytrade, I will simply trade longer term time frames.

Nevertheless,

have a look at the chart for todays action and the corresponding volume.

Tell me what you see. ...
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this is thinking on 5m, I have no idea on longer time frame or trend.
 

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I want to thank Babak and Nkhoi for your insights. Nkhoi, youre chart with the description was quite interesting.

A couple of notes on your chart NKhoi. Looking at arrow number white arrow number 4. It seems that it is a very high red bar, but the price goes higher, not lower as you indicated. Does this indicate to you that a higher high has been made with more sellers than buyers indicating that there is a confliction and thus the price should move down subsequently. I know it did move down, and hindsight is 20/20, but what is the general consensus.

Also, on the fifth bar, you have indicated that you would sell because bar is green but price is not going higher, when in fact the price was going higher. That confused me a bit.

Have a look at todays chart. By the time you guys read this you will already know what happened. I hope you guys can all see this. I included the ADX/DMI indicator as well. The green line is ADX. Blue DMI+ and Red DMI-. Also included the Stochastics.

Heres what I know.

I know that yesterday there was a gap up from high of Wed 34.35 to open of Thursday of 34.65 and it went up from there and stayed up without filling the gap.

However, I also know from the chart that right now, that DMI- is too high with not a high enough trend (ADX line).

I also know that the Stochastics appear oversold right now.

However I also know that volume is rising as the price is falling. So what does all this say about what will happen.

I think here is what will happen, and I want some astute traders to criticize me on my mistakes.

I think the gap will eventually get filled, but very very short term, it is oversold. It is at 34.94 right now, and needs to rebound about 0.10-0.15 cents upwards, thereby ending the oversold conditions as they appear on the charts. When that happens, the next wave down will occur, because obviously today there is weakness and OF COURSE, LETS NOT FORGET THAT GAP FROM YESTERDAY.

So I buy here trade for 0.05-0.10 cents. Then as the indicators improve a bit, I sell, because I believe based on this price action and the gap from yesterday, and the fact the stock has run up a lot and the fact there arent many buyers this will be a consolidation day. So I will sell for that gain and watch as I sell down again. This pattern may repeat throught the day unless I see something else happen that indicates otherwise.

What do you guys think of my analysis. And what pitfalls should I look out for in buying and or selling and trying to predict the whole days action.

Man, I love this tape reading analysis. I know it is my stock, but to hear what others have to say is very interesting.
 

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I was dead on about the bounce off the low at 34.94, However, I would have sold for only a ten cent gain. Since Im not comfortable shorting, I would have to wait for a long entry again. Yah, I know what you're thinking

"This guy wants to trade but doesnt want to short, man take a hike or take of the diaper"

Thing is i have never shorted before and am new to trading, so trading long in and of itself must be practiced before I start taking the risk of shorting also.

Anyways, back to the tape (Ive always wanted to say that)

Now what Im seeing is the stochastics entering overbought territory and also the ADX basically is signaling that there is absolutely no faith in the trend, either up or down.

We obviously must wait for an entry because we have already sold at 35.04. Hopefully, we get an entry below that.

People, talk to me here. What do you think?
 

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