Trading BGEN on Fri evening

[Naz]

I would say that if you were good at trading Nasdaq stocks and reading your level 2 screen you could have seen the Friday evening move coming even earlier than many others.
If you look at BGEN over lunch it held the whole number at $53 giving you ample time to read the mood of the stock and a chance to buy it on the bid with direct access.Stop 30c away.
It breaks 3/4 hr before the Nasdaq 100 and 1hr 15 min before the Dow.

At 2pm it moves again and holds, allowing the stop to be moved up.Level 2 showing where support is and if it is real or not.
Once we clear the next whole number, $55 is in our sights.Level 2 giving us all the guidence we need and the stop being moved up as we go.At $55 the resistance would have been plain to see on the level 2 screen and direct access would have taken you out near the top (just hide that order on island and leave it there for a good fill,and get out on the ask).However a decent trailing stop would have taken you out at $54.8.See the fake past $55 you would have seen that on your level 2 screen as well.

So a scalpers entry with a 30c stop gave you $1,800 profit with 1000 shares,risk reward 6/1 and it also gave you advance warning of the indices move.Another nice touch is that this move gave you time to save the spread at both ends of the trade.

A final word is this,charts are an excellent tool to find potential set ups but personaly once in the trade i forget about them because they will only show what has just happened and oscillators will only show you what happened ages agnce in the trade the aim is to be ahead of the game and not behind it.

BGEN does large volume allowing you to take trades where you want to not where you have to.Primary and secondary axe's are Lehman and Morgan Stanley who do more volume than island. BGEN is also a good indicator stock for the biotech index.($nbi.x)

Sectors that i like to watch for moving the Nasdaq 100 are $sox, $gso,$nbi so seeing BGEN and tier 1 generals in other sectors showing interest before 2pm EST was a nice feeling that things were looking good.

 

[tjbw]

Good trade.

I bet you would have done well with nvda as well.

Barry

 

[ChartMan]

Just to keep a balanced view......for those that don't trade L2...I think the charts would have got us in just as soon if not sooner- the pos divergence on Phase is a killer for early entry- well below the 00 point (52.80), confirmed by double bottom on CCI ( I like confimations- belt and braces). Easy ride to the top too- trend following Phase, Neg Divergence on CCI , and we're out at a whisker under 55. Why? Because we know 55 was prior support and even stronger resistance.No point in even thinking there might be more. As for charts showing you what has happend, you're quite right of course, but if you chose the right indicators and apply the correct techniques, they tell the future too.....Don't let anyone tell you any different.

 

[Naz]

Thanks Chartman i agree with a balanced view.I do say in the post that charts are an excellent tool to find potential set ups,but personaly once in the trade i forget about them because they only show what has happened.

If you trade Nasdaq stocks however without understanding the full picture you are putting yourself at a disadvantage.Whether a trader takes advantage of L2 or not is down to each individual,but at least they should undersatnd it exists. Here are some quotes from this board from people who have seen it in action.



"I can only liken it to an iceberg with level2 enabling me to see and understand for the first time what is actually going on beneath the surface before you see the outcomes/moves on the charts."


"It was truly stunning, we hadn't looked at a chart of Ciena or the Nasdsaq for that matter' infact we weren't even sure how the Nasdaq was trading at that moment, yet by watching the price action and market maker behaviour Naz could see the stock was about to bounce."

"A previous post had written ' it was like the iceberg analogy' which in my opinion does not emphasise the advantages L2 Nasdaq has over TA.

I am sorry chaps, but I have practised TA for 4 years and have been on many (expensive ) courses and all I can say is that in the one day I have had with NAZ it has been the most worthwhile out of them all. I cannot believe there is anyone who would not walk out of this one day still preaching the advantages of TA over this approach."

I hope each individual didnt mind me re posting their comments.

 

[tjbw]

NVDA up more than 3 ½ points from low at 3:10pm, that's about 11%.

Beat that BGEN

Barry (too bad I wasn't paying attention)

 

[ChartMan]

JDSU, SUNW and no doubt lots more We on the up...