How To Trade: Full Stop

[The Expert]

As a reward for DT's hard work, I will soon post a snapshot of what is to come, but this is a good bit down the road, so do not start asking me questions about my next post. Stick to what we are doing now and fully understand the importance of it for daytrading US stocks.

 

[temporarilylight]

The other images are for other symbols. Finding them would be a bit of a needle in a haystack job - or rather a job for a few lines of code & a scanner.

what trading platform is that chart from? What is it actually showing?
cheers.

 

[Charlton]

I like your graphs DT, as for the others just let them be, for you are correct when you say that all that matters is trading. We will let them be and carry on.

Now, it is not how the graph is obtained that matters, but what the graph tells us. One can use Excel, Trading Software, Com, C+, API or any other means of data gathering. The key lies in understanding the data and using it to assist us in making better trading decisions.

If anyone had bothered to post their next trade for C, which I will not be asking again BTW, then they would more than likely be sitting on their butt today staring at a very boring screen.

Let us move on to the next set of graphs, and the symbol is HPQ.

By now, it should be obvious what we need to do as daytraders, if not then I suggest you start asking some serious questions before you really get left behind.

Well done DT, you are the first sensible to step forward and speak your mind. You are now on your way to becoming an Expert, so do not fall into the usual trap and become an amateur, as nearly all do.

OK - here is my version of the same graph, this particular one being obtained direct from Tradestation, perhaps not as clear as the one produced by DT because of the overlay and mine continues one more bar beyond.

So now that I see what the data represents, I will await the next instalment.


Charlton

 

[morgan_edge]

what is that? the average daily range in cents or something?

 

[The Expert]

But there's a difference: Not every member is creating threads claiming to know all there is to know about trading and naming themselves "The Expert". Then proceeding to answer a question with a question and speaking in an ambiguous manner and being really short at people.

Yes, it could be the real deal but i've seen it too many times and unless you see some proof he could be talking out of a text book for all you know. Until proven incorrect i'm more likely to put him in the latter category, just saying....enjoy though, someone may get some value from it.

As I mentioned at the very start, I am in the business of making money, not friends. I do not have to rely on supplemented income from coaching other traders, as I know that it is all bs and it is immoral to take money from others under such conditions.

Matter it not what I can or can not do, Matter it most what you can and will do.

As for value, there is more value in the Goose than in the golden eggs.

 

[The Expert]

I shorted C on the Ask at 3.44 at 10.56 EST and covered at 3.43 on the Bid at 10.57 for a 1 cent move which is all I was looking for. You are correct that it is not doing much today though and I will look at HPQ.


Paul

1 cent profit target is not a worthwhile endeavor. An opportunity missed is an opportunity lost. Many so called "professional traders" speak of lightning speed trading and fast executions. They like to see themselves as professional tape /lev II readers and try and convince themselves that they know what the markets are all about. Hogwash I say.

If they really knew anything about stock price movements, then they would not speak in such a manner, as all they are really doing is showing off their ignorance.

Opportunities are to be maximized at all times, anything less is unprofessional and just downright stupid.

Stock prices move for a specific reason and understanding the specific reason is the basis for consistent profits. I will point you in the right direction, it is up to you to open your eyes and see what is in front of you, either way it makes no difference to me as I take money from those who have plenty.

 

[The Expert]

I have changed my mind based on the last few posts and will now post this instead.

 

[The Expert]

Now DT, which one is this for?

Hint Hint, the short ratio is 2.50

 

[DionysusToast]

what trading platform is that chart from? What is it actually showing?
cheers.

Its from Tradestation. I needed to do a very small amount of programming to get it into this format.

Red = daily range (high - low) of C.
White = (Close - Open) of C.

When I saw the first chart, I thought it was daily range but it was so small, I thought it couldn't be on account of this is the type of stock I avoid - a stock without much movement.

With the huge volume, you have no worries about getting in & out but with a day like yesterday - 233 million shares traded but only 7c between the high & the low, the style I trade would not make money.

In fact, you have to marvel that so many shares can change hands wthout the price moving.

 

[DionysusToast]

Now DT, which one is this for?

Hint Hint, the short ratio is 2.50

BDX looks a good fit to me.

 

[DionysusToast]

I shorted C on the Ask at 3.44 at 10.56 EST and covered at 3.43 on the Bid at 10.57 for a 1 cent move which is all I was looking for. You are correct that it is not doing much today though and I will look at HPQ.


Paul

Which broker do you use that you can profit from a 1c move ?

I thought I was getting it cheap with IB at half a cent per side...

 

[DionysusToast]

I have changed my mind based on the last few posts and will now post this instead.

I mentioned earlier that I know a guy at a hedge fund that does purely intra-day trading.

Of course, they have a plan of what to do prior to each day. The sheet above is quite similar to what they compile in advance of earnings days in order to help them formulate their plan.

Spreadsheets are a real pain in the ass for this type of stuff and yet I have found no useful trading software that lets me see this stuff and also keep my notes which I can call on for the next quarter. Only yesterday, I started to develop an Access database to store this type of into and I am also getting input from the hedge fund guys so that it covers the bases and we can share the software. The goal of the software for me is to get a deeper understanding of what initiates major moves and what doesn't.

Right now, I can jump on a move and make money but I would prefer to anticipate moves, which I know is possible as these hedge fund guys are doing just that. I may fail in this effort but it does not detract from my trading, so it is a worthy exercise.

 

[timsk]

Red = daily range (high - low) of C.
White = (Close - Open) of C.

Thank you DT.
The only clear pattern that I can observe on all of The Expert's Excel charts so far, is that the high-low range of the day is usually equal to or greater than the close-open range. Therefore, if the latter is large, it is probable that the day's trading range will also be large. Unless you're a scalper like BTippen, shaving off a cent or so at large size, knowing that there's likely to be good volatility on the day in a stock with great liquidity is useful. However, I'm still not clear how this helps one trade it? After all, there are lots of ways of filtering volatile and liquid stocks. So, if any of you star students at the front of the class know the answer(s) and want to help out some us us laggards at the back of it, that would be much appreciated!

Tim.

 

[DionysusToast]

Timsk

To help you with this - perhaps I can play with one of your statements.

If I said the following "the high-low range of the day is not usually equal to or greater than the close-open range"

What would you make of that statement ?

This is not a **** take, it's a serious question.

DT

 

[timsk]

If I said the following "the high-low range of the day is not usually equal to or greater than the close-open range"

What would you make of that statement ?

Sorry DT, I've never been one for parlour games and riddles. I let other people solve them (like you) and then pat them on the back and tell them how clever they are. It's a symbiotic relationship which has served me well over the years. So, my answer to your question will disappoint you I'm afraid and it is that your statement appears to be the polar opposite of mine, leaving me to conclude that I'm not interpreting the information on the charts correctly (assuming you are - of course!)

Is anyone else able to shed some light as to what the charts show - preferably in simple, straightforward, easy to understand language please!
Tim.

 

[Hotch]

If I said the following "the high-low range of the day is not usually equal to or greater than the close-open range"


DT

"Hooray!" for parlour games!

(Assuming I'm reading this right)

I'd say it's bull****.

High-Low >= |Open-Close|

by construction.

 

[Charlton]

Thank you DT.
The only clear pattern that I can observe on all of The Expert's Excel charts so far, is that the high-low range of the day is usually equal to or greater than the close-open range.
Tim.

Or putting into English what the others have been saying "the absolute value (i.e. ignoring signs) of the high - low range is ALWAYS greater than or equal to the absolute value (i.e. ignoring signs) of the close - open of the day.

As far as I can see nothing further has been explcitly said on this matter yet, apart from perhaps the comment about needing to know what moves price and therefore what affects these ranges.

Charlton

 

[Adamus]

If I said the following "the high-low range of the day is not usually equal to or greater than the close-open range"

What would you make of that statement ?

How about this:

the low is usually not lower than the high?

:jester:

Sorry, couldn't resist it.

 

[The Expert]

Apart for DT's astute observations, I feel the importance of the graphs are not being grasped by many. As of now, the starting line is but a faint image in the distance, but if we are not prepared for when we get there then we will not be at the races, at all.

Rule No.1, and it is not anything like The Phantom will tell you, is as follows.

"Do not waste your time on stocks with an ADR of less than 50 cent"

I hope this is now clear to all, as it is the most important rule for daytrading.

BTW, I know what DT is getting at, and it is apparent than very few do.

 

[The Expert]

BDX looks a good fit to me.

Rule No.2