Evening trading US shares

[Trader333]

I guess you think the market is oversold - hope you're wrong

Not on this one I wasn't.


Paul

 

[timsk]

Not on this one I wasn't.

Nice one Paul. Interesting too, in that I didn't realise you are a scalper.
My two trades are still running. Most unusual. I'm normally flat for the lunchtime session and I had to go out today and make the decision to leave 'em on or close 'em out. I left them; both have been into profit and, now I'm back, there right back where they were before I went out!
Have a good w/e,
Tim.

Edit - 26/07/08
These trades go into my record books - not for their profit, sadly - but as the longest running day trades. Closed out both for a small profit as the end of day volatility picked up. What a dull day!

 

[Mr. Charts]

Here's a typical scalp from y'day.
A 66c gain very fast in a reasonably priced stock. For someone trading 1000 shares that's $660 minus $10 broker commission; 2000 shares $1320 and so on.
Scalps for me are not about trying to find the beginning and end of moves, but about taking bites out of clearly trending stocks with clear momentum on the chart and confirmed on the level 2 screen plus sometimes on T&S.
The first text images are from elsewhere on the web.
Richard

 

[Mr. Charts]

After the trade.

 

[Mr. Charts]

And the chart.
X hairs on the short and screenshot taken at time of covering.
Richard

 

[Mr. Charts]

Here's another pattern set up I frequently use. Worth looking out for, imho.
Personally I always look for confirmation on level 2 and sometimes T&S. That reduces the percentage of failed trades very considerably.
I identified this stock as a possible potential momentum mover before the market even opened.
Richard

 

[Mr. Charts]

And here's the chart.
This was a gain of $1.07, which is $1070 on 1000 shares and pro rata for smaller or larger position sizes.
I always look for cleanly moving stocks as they are much more likely to be successful trades.
The entry was on the X hairs and the exit at the time of the screenshot.
Richard

 

[Mr. Charts]

You can normally find trades like these most days and I find it much simpler to see and read what is going on from the chart and level 2 rather than to use lots of dubious indicators.
Works for me and has done for years.
Richard

 

[thevinman]

low average volume?

You can normally find trades like these most days and I find it much simpler to see and read what is going on from the chart and level 2 rather than to use lots of dubious indicators.
Works for me and has done for years.
Richard

Hi Mr charts,

AMSC was a very nice set up and well done on the trade. But I do have a question. I see that the average volume is below 1mln. Is that not a problem for you as the spread is normally bigger on low volume stock?

Regards,

thevinman

 

[Mr. Charts]

Hello thevinman,
Sometimes the spread can be wider than 1c or 2c, but you can always buy on the bid and sell on the ask to capture part of the spread for yourself.
Also with momentum stocks the momo usually carries you into profit very quickly, provided your timing is right. You really need to be experienced to trade within the spread with momo.
It doesn't matter too much what the average volume is; what really is significant is how much it is trading on the day itself.
Look at the attached image.
The spread is tight at the moment but there is no longer much trading, and the volume is not 1 million, it's 2.76 million.
Hope that helps,
Richard

 

[Mr. Charts]

Image

 

[thevinman]

scanner set up

Hello thevinman,
Sometimes the spread can be wider than 1c or 2c, but you can always buy on the bid and sell on the ask to capture part of the spread for yourself.
Also with momentum stocks the momo usually carries you into profit very quickly, provided your timing is right. You really need to be experienced to trade within the spread with momo.
It doesn't matter too much what the average volume is; what really is significant is how much it is trading on the day itself.
Look at the attached image.
The spread is tight at the moment but there is no longer much trading, and the volume is not 1 million, it's 2.76 million.
Hope that helps,
Richard

Hi Richard,

Thanks again for the explanation.

I am re-thinking how I should set my esignal scanners. The last few weeks I had too many small losing days.
From my analysis of my trades I figured out that I am trading high priced and rather big spreaded stocks.

I have used the dollar gainers scanner priced between 20 -120 dollars, average volume above 1.6 mln and a variable min vol starting with 400k progressing to 1.6mln at the end of the day. Of course at the top of the list are always the volatile coal and energy stocks.

I now know that this is not a good scanner set up. These stocks I trade are not in harmony with my personality.

So today I changed my scanner to 2 day high and 2 day low, priced between 7 and 70 dollars with an average volume of a 1mln.

If you have any suggestions let me know.

Kind regards,

thevinman

 

[yacarob1]

You can normally find trades like these most days and I find it much simpler to see and read what is going on from the chart and level 2 rather than to use lots of dubious indicators.

Dubious indicators work for me very well indeed Richard and I wouldn't do without 1 or 2 of the more useful ones.

Level 2 has never done it for me and I have always found it to be over-rated....fleeting and deceiving.

But each to his own eh ?

 

[timsk]

So today I changed my scanner to 2 day high and 2 day low, priced between 7 and 70 dollars with an average volume of a 1mln.

If you have any suggestions let me know.

Hi Vineman,
You don't mention how many stocks this set up produces each day but, if it's a lot and you want to refine the list further, you could try adding a a filter to select only those stocks with a daily H/L trading range of >$1.00. I set mine to >$1.50 and, additionally, the volume threshold for NYSE stocks is 4 million (and 1 million for Nasdaq) which helps to produce a more equal balance between the two exchanges.
Tim.

 

[PitBull]

Hi Pete

So I take it your looking for a breakout of the 2 day high/low? Be careful of this set up as this strategy is well known and does produce many fakes.

My min volume filter is on >0.5m and I trade anything price wise but thats whats suits me.

Regards
PB

 

[thevinman]

Hi Pete

So I take it your looking for a breakout of the 2 day high/low? Be careful of this set up as this strategy is well known and does produce many fakes.

My min volume filter is on >0.5m and I trade anything price wise but thats whats suits me.

Regards
PB

Hi Pitbull,

The scanners only show symbols that are trading above the two day high or below the two day low and then set the highest or lowest % change on top. So all symbols that are priced in yesterdays range are not shown.

For me it is an extra filter as prices that are above yesterdays high are more likely to go up as it already broke through the yesterdays high resistance.

Do you change your min vol per time unit'? I start of in my filter with 400k. At 10 I will change it to 800k and at 10±30 it is on 1mln. My average daily volume is at 1.6 mln.

Cheers thevinman

 

[thevinman]

Hi Vineman,
You don't mention how many stocks this set up produces each day but, if it's a lot and you want to refine the list further, you could try adding a a filter to select only those stocks with a daily H/L trading range of >$1.00. I set mine to >$1.50 and, additionally, the volume threshold for NYSE stocks is 4 million (and 1 million for Nasdaq) which helps to produce a more equal balance between the two exchanges.
Tim.

Hi Timsk,

I had written a long reply, but for some reason it did not come onto this thread. I will try again.

Every day I am getting loads of nice set ups, because I have set the price filter all the way up to 120 dollars. These high priced stocks are also the big dollar gainers and losers of the day. Most of them have nice set ups, but there is one problem concerning my risk parameters. I don't want to lose more than 15/20 cent per trade. In the last few weeks I have learned, as I was losing money (great teacher), that I am trading the wrong stocks. Though risk/profit ratio is really good I cant emotional handle a 40 cent wiggle.

So yesterday I decide to change my price filter from 20 - 120 to 7 - 70 dollars based on going through the scanners and check all the possible set ups I could have taken and looking at the prices that were clustered together. In my old setting I would never have seen DKS, BYD and NWL.

Yesterday evening I traded BYD break out at 14 dollars and gave it a 15 cent wiggle. It went up to 14.47. My first half a I sold at 14.31 and the second at 14.45.
I also traded RRI on the break down at 15 dollars. The first half I bought back at 14.82, as I was still a little in my scalper mode and the second half I bought back at 14.42.
I must say I did these trades in the simulation account. The next three days I will trade with this account to get my vibe back, so that I can start fresh on monday.

Unfortunately esignal power scanners only have price and volume filters. I have suggested to esignal a ATR filter and a relative volume filter, but they haven't made any changes in the scanners for years. So I will do with what I got!

Thanks for your reply,

thevinman

 

[Mr. Charts]

thevinman,
Look at ATR and stock price level before deciding on your position size.
You can't use a 15c stop loss on POT without being knocked out by the intra bar volatility, whereas 15c is more than adequate on a stock like ADBE.
Vary your position size accordingly so you stay within a maximum dollar loss and you will find that less stressful. This is assuming you don't read level 2 which would often give you better entries and exits and sometimes warn you in ADVANCE of any chart movement; it's not infallible but in the right time and place gives you a very strong edge.
Richard

 

[Mr. Charts]

Dubious indicators work for me very well indeed Richard and I wouldn't do without 1 or 2 of the more useful ones.

Level 2 has never done it for me and I have always found it to be over-rated....fleeting and deceiving.

But each to his own eh ?

I wouldn't expect you to use the dubious indicators anyway
Richard

 

[timsk]

Unfortunately esignal power scanners only have price and volume filters. I have suggested to esignal a ATR filter and a relative volume filter, but they haven't made any changes in the scanners for years. So I will do with what I got!

I completely agree with Richard - then again - I usually do! ATR is an excellent tool to help ensure your position size is within your risk parameters. It would be tricky, I imagine, for eSignal to encompass ATR as a filter to scan stocks, not least because the readings will vary according to the timeframe chosen. Once you have your scan results, you could try varying the timeframe until ATR is at an optimum level for your risk/ money management strategy. High priced and volatile stocks that have an ATR reading that's off the Richter scale on, say, a 10 min' timeframe, may have an acceptable reading on a 3 min' or a 1 min' timeframe. I realise that this approach many not be compatible with your strategy and that many traders prefer to stick to set timeframes and not to mix 'n' match! Just thought I'd throw it into the melting pot!
Tim.