ACI,AIG,AUY,BBY,BEXP,CCL,CHK,CHU,COG,DRYS,FMCN,GG,GLBL, IBN,IGT,KEY,KGC,MEE,NSM,OXY,PBR,PVTB,STO,WB
BBY (gap down)
After gap down and green 1st candle, the 2nd breaks the OR. The next candles 3rd thru 6th all hold the OR as resistance as we consolidate sideways. The 6th is a gravestone type doji red off the ema. It is also a NR3 and closes weak itself. This is our short trigger.
Entry: 45.07 Stop: 45.47
Fib Ext: 44.42
1R=44.67 2R=44.27 3R=43.87
The candle after entry is promising. After some choppy action, we do fall a bit further later in the day and close partial at the Fib Ext (around 1.5R). The rest is closed at end of day for 2R.
CCL (gap down)
The first candle test previous day's low as resistance. We then trend down past the OR low. The 4th is a NR3 which tests the OR as resistance. The 5th is bearish red hammer like. It is off the ema and the OR closes weak itself. This is out short trigger.
Entry: 37.95 Stop: 38.35
Fib Ext: 37.78
1R=37.55 2R=37.15 3R=36.75
We trend down slowly for rest of the day. Take partial at 1R and then rest at end of the day for just below 2R.
Overall a couple of smallish gainers. Often happens when the market gaps down a large amount.
I did have an entry in CHU 8th candle short, but it never triggered. Also had an entry in KEY which also didn't trigger.
11 comments:
Holy chop fest!
My dumb ass went for longs today. Hope you had a better day than myself.
Hey TA, can I get your opinion on the 4th bar on MVSN.
Would you pass on this because of either
a) slightly upper wick
b) we just came from a nasty reversal
Thanks
pdt.
MVSN > the wild first 3 candles would have put me right off attempting any sort of trade on this stock.
I am having difficulty with my entry/exit orders. If I set limit orders, most times I miss trades. If I set market orders, I get high slippage. Can you please walk me through this real-life example of how you actually do it:
Entry: 36.38 Stop: 36.15
Exit 50% at Fib Ext: 36.71
Exit 50% at 2R: 36.84
I know it is a simplistic question to ask, but it is driving me crazy. I want to make sure I am doing the right thing. BTW, your blog is the best, and just like trader X, it has a lot to offer.
justin.
Your entry price is 36.38. So I am assuming that your trigger candle high is 36.38. You stop is 23c away. So this will allow you to work out your position size. Let's say it's 200 shares for sake of simplicity.
1. I place my STP LMT order with IB to buy 200 shares. The STP price is set to 36.42 and the LMT price is set to 36.44. If the stock as a wider spread then my LMT price will be say 36.47. If the stock moves up very quickly then it means I won't get filled. It happens now and again, but I'd rather have that than use a MKT order and enter a position too far away.
2. Once position is opened then I put my exit orders in. Two STP sell orders at 36.15 (100 shares each) and two LMT sell orders at 36.71 and 36.84 (100 shares each). These are OCO orders, so once one LMT order executes then the linked STP order cancels.
3. Once I reach 1R then both STP sell orders are moved to breakeven (entry price).
4. Once first LMT order is executed (in this example at 36.71) then I moved my remaining STP order to breakeven.
Hope this helps. Glad you like the blog.
P.S > Is there any reason why you get missed trades "most times" ? Maybe the stocks you trade have wider spreads etc? I do get some misses, but not for the most part.
Hey TA,
On days like Friday do you tend to ignore any long setups and focus just on the shorts?
I know generally you should just go with any setup you see but it seems like on extreme days like Friday it is hard for any stock to trend in the opposite direction of the market.
One other question, I see that on CCL your entry was quite close to the fib ext. Do you have any general rule that you would like to see at least say X:1 on your entry to the fib ext to justify the risk?
pdt.
On big market move days, my watchlist will be comprised more of the gaps in same direction as market. So as a consequence, I am more likely to enter trades in same direction. But I don't purposely exclude stocks which gap in the opposite direction. In fact I think that of my top 10 biggest gainers there are probably a couple which have gapped against a big move in market direction.
CCL> I don't have a general rule on that, but it may be a good thing to bear in mind. Ideally the Fib Ext needs to be at least 1R away. For CCL specifically, I liked the price action and also the market was in a big decline, so I thought it was a trade worth taking. The pullback after hittig the fib ext was also a key factor. The 9th candle failed to hold the whole number and was followed by a weak candle.
Having said all the above, if you said that any trade where the Fib Ext was less than 1R away, then refuse the trade ...I wouldn't argue with that approach.
Thanks. I appreciate you taking the time on your weekend to answer my questions.
You've really helped accelerate the learning process for myself.
Thanks for detailed response.
However, if you exit fib & 2R with Limit orders, this means that if price blows pass your activation price, your order will not execute (limit guarantees price and not execution, as opposed to market orders, which guarantees execution but not price). How do you fix?
I believe my problem is that my order does not take into account the spread of the stock. Most will trade .02-.05 cents spread and I am setting too tight a limit order. I tend to trade stocks with price greater than $50.00
TR: is there a way to communicate on your blog, with you, in real time? Are you open to such an idea, and is it technically feasible?
BTW, do you trade the british stock exchange? Is it just as lucrative and versatile as its American counterpart. Or much more cumbersome, and difficult for foreign traders to focus on?
Thanks, Ralph
ralph.
There is no real-time comms on the blog. And in any case I am not currently trading full time everyday, so I wouldn't be accessing my blog continously whilst at work.
By all means send me an email (address on blog) if you want during market hours.
I don't day trade on the UK Market. But I do have some long term positions.
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