Weinstein Trading and Fading

robert,

thanks for your kind of acceptance

my wife just printed a trader's confession to me, she found it on the internet.

' I've been a full time trader since the 70's and I still pay too muh and sell too cheap. I' am better than a ATM

Seriously, until you've been in the business for years, in bull and bear markets, you do not know if you'll make it. 5 years is the the limitus test, but then again, I know 30year traders that went belly up last year. you're only as good as your last trade'.

when I look at Gold's opening price this morning, I was shocked to find it went up almost
20points again, I thought it will rest a while. that made my "hit sell button hands shake". glad I did not hold short GC dec (thought it will retrace to 1151~1149), I covered my short at 1158~1161.

but feel irristaable to short gold, peek it, then remove it, it is still going up, that makes me feel at loss what to do. gold's relentless rally makes me very nervous today, could not hit sell button to anything.
 
tough day but I did not let any trades get to far out of hand and maintained control.

bought the tops and sold the bottom more than once today and I just couldnt get anything going. The one most frustrating trade of the day came at the end. I had a signal to buy FMX at 44.60 down to 44.50 and if it fell through 44.50 I should reverse and go short. I jumped the gun and thought I would be ’smart’ and short it at 44.52 as I ‘thought’ the odds favored it falling through the close. So instead of buying at the dead bottom and getting a nice rally that would have put me near BE for the day I sold at the dead bottom. very frustrated. I did reverse and go long and regain some of the loss but not much. This was based of a new signal (or should have been if I had done it correctly) but as frustrated as I am with this trade and the others I also feel that I have been through this before when working out new signals and I expect next week that it will start producing gains.
FMX – 421

SKM even. took a stop loss
PXP was another one where I bought at the very top and then sold out and went short near the bottom. ugly trade the whole way and it went on for much of the day
-308
JCG, gap up trade + 48
INCY bought near the top and took a took my stop near the bottom
- 297
APWR gave an overbought signal but I didn’t notice it until it was really too late. took a small gain with a late trade. would have been much better had I seen it earlier. + 20
- 956
- 12571 month
 
For what it's worth, it may be best to fade very liquid stocks with low volatility, while having a favorable r:r management strategy. Support/Resistance, either short-term (daily) or swing (weekly or monthly), may be the best bet for triggering entry points to fade.

Although a bit risky, it may be worthwhile to averge down (scale in) once or twice. Consistency, with a positive expectancy and good money mgmnt, will yeild favorable results in the long run...


Walt
 
Robert,

I also trade as fader more often than follower. I have traded for less than two years and followed your trading since the beginning. FWIW here are just some thoughts:

1. Always think about what if I am wrong.
2. The sad fact about cutting loss is the larger the loss becomes, the more difficult to cut, and with average down strategy, the worst always come when you are very wrong with the biggest size, “surprised” and freeze. Many times your “not so big” size becomes very big since the stock’s range is many times than “normal”, e.g. your AIG trade and your SEED trade yesterday.
3. Price can never be too high or too low. It is a game and the key is to think who is trapped and who is being trapped and who must to cover. Never being the one that is trapped with large size and unable to cut loss.

What I do different than you:

1. I only scan/trade about same 20 stocks, in the price about $40 to $200.
2. In addition to chart pattern, I use Market Internal as a main filter to decide entry/exit point.

Happy Thanksgiving and best luck to you and your family!
 
Quote from Robert Weinstein:


FMX – 421

SKM even. took a stop loss
PXP was another one where I bought at the very top and then sold out and went short near the bottom. ugly trade the whole way and it went on for much of the day
-308
JCG, gap up trade + 48
INCY bought near the top and took a took my stop near the bottom
- 297
APWR gave an overbought signal but I didn’t notice it until it was really too late. took a small gain with a late trade. would have been much better had I seen it earlier. + 20
- 956
- 12571 month
More...

hi, robert, are u a swing trader or a scalper? In other words, how long did you hold those trades today?
 
I shorted GC DEC around 1169~1171 in the monday opening, I did not post this trade on P/L this monday after I got out of my LONG GC DEC, covered it monday AH around 6:00~8:00pm at 1158 to 1161.
Actually I hinted Nodaji to take the 1169 short to her message box. after I covered it, I thought it will not go higher or at least it will rest a little bit, so I did not buy GC anymore, I am waiting to short it (some retracingment signal or temperary reversal sigsal), but I noticed GC just keep going up, that is beyond my buy point, I decided to not to chase in case I was trapped by the parabolic move, I just think maybe it is just around the corner for short sale opportunity .

just turned on my computer, noticed NQ dropped 44points, GC's relentless moveup holds me to short NQ yesterday ( I thought the general market may take breathe too).




Quote from doublef:

what was the entry price? trying to figure out how much money you made.
More...
 
when you are in a losing streak, the best way is stop.

I read Martin schwatz's book of "pit bull". he said when a trader is in a losing streak, he will wait and wait, since he wants to make sure next trade is a winner, the odd is he either waited too long (waited too long to buy the exact top or short the bottom, that is sure signal) or jump on gun with no dsicipline, he took bigger and bigger risk.

better stop a while. the bad trade will affect the next trade's decision.

toke a small position, do some research, stay in the trade one or two days or a little longer, daily volitilty will be filtered out and your trade will finally work out.


Quote from Robert Weinstein:

tough day but I did not let any trades get to far out of hand and maintained control.

bought the tops and sold the bottom more than once today and I just couldnt get anything going. The one most frustrating trade of the day came at the end. I had a signal to buy FMX at 44.60 down to 44.50 and if it fell through 44.50 I should reverse and go short. I jumped the gun and thought I would be ’smart’ and short it at 44.52 as I ‘thought’ the odds favored it falling through the close. So instead of buying at the dead bottom and getting a nice rally that would have put me near BE for the day I sold at the dead bottom. very frustrated. I did reverse and go long and regain some of the loss but not much. This was based of a new signal (or should have been if I had done it correctly) but as frustrated as I am with this trade and the others I also feel that I have been through this before when working out new signals and I expect next week that it will start producing gains.
FMX – 421

SKM even. took a stop loss
PXP was another one where I bought at the very top and then sold out and went short near the bottom. ugly trade the whole way and it went on for much of the day
-308
JCG, gap up trade + 48
INCY bought near the top and took a took my stop near the bottom
- 297
APWR gave an overbought signal but I didn’t notice it until it was really too late. took a small gain with a late trade. would have been much better had I seen it earlier. + 20
- 956
- 12571 month
More...
 
Short trading day on this Friday after Thanksgiving

Two trades both based on an old (new in terms of updates and improvements so now being used again) WW signal. Both where only 100 shares but as it uses a pretty tight stop so I expect to be ramping up the size next month if the test period goes well.
X stopped out short + 4
ARO + 55

I did get two overbought signals. one of RINO and the other with APWR. Both would have been great winners but IB didn’t have shares available in either so I was left just watching it happen.

+59
-12512 Month
 
Hey NoDoji,

Yeah that about sums it up.

Mostly the problem has been taking trades I never should have to begin with. Of course when you add in the fact that I am up for the year that can even be debated somewhat (some trades regardless I should not have taken or not have traded the way I did)

I broke out an old strategy that I used to use but was difficult due to the amount of time it would take. Due to the statistics class I just took I am now able to write the math formulas to automate the scans for the setups.

That along with other recent risk adjustments should mean a good Christmas for me.

Time will tell


Quote from NoDoji:

Fading strong moves isn't, in and of itself, a poor strategy. Robert has demonstrated its profitability over long stretches of time.

IMHO, though, there are some fundamentals that need to be considered before choosing to fade a strong move as opposed to waiting for a lower high/higher low: the nature of the news, short interest, how far the stock's price is from all-time highs and from 52-week highs.

SEED, for example, gapped up on fundamentally excellent news.

USG from back in Sept had very high short interest.

When AIG first started its string of breakouts, you're looking at a stock that in 2008 traded near $1500 a share (split adjusted), plus the 20:1 split made the squeeze potential huge.
More...
 
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