Trading NASDAQ stocks with Jerry Olson & Ian Hodgson

[Jerry Olson]

Closed Both Trades

1:43 AM) ovetus: ALKS bucking trend ....so far ...lol
(11:44 AM) mplsrmt: 11:42 BBBY Bed Bath & Beyond files to delay their 10-Q (37.15 -0.72)
(11:46 AM) trendhack: went long bidu at .88
JerryO3434: long sndk at 61.85 30 CENT STOPS
(11:47 AM) trendhack: out at .45
JerryO3434: LONG AAPL AT 67.83 30 CENT STOPS
(11:47 AM) screenshot: bombardament of the roses continues anabated
(11:48 AM) devpsych: Note to self-never buy anything from teleflora
(11:49 AM) trendhack: that bidu another perfect play just like yesterday
(11:49 AM) mplsrmt: 11:49 BT BT Group PLC likes Nortel's new ethernet flavor - LightReading (39.99 0.00
(11:49 AM) screenshot: they must be pretty stupid if they think they are getting an order from me
(11:51 AM) cashmarket: PALTALK MUST BE IN THAT STUPID CATEGORY
(11:52 AM) trendhack: in aapl at .69
(11:53 AM) mplsrmt: 11:53 IUSA InfoUSA: Dolphin Seeks Election of Three Independent Directors (10.11 -0.21)
(11:56 AM) mplsrmt: 11:55 GOOG Google, Nokia to Launch Internet Browsing Device - WSJ (377 .00) -Update
(11:56 AM) trendhack: out aapl at .87
(11:56 AM) cashmarket: nice trend!
(11:56 AM) trendhack: thx cash
(11:56 AM) trendhack: wants higher, but i'll take it
(11:57 AM) mr moto_1: NVDA foo the bottom
(11:57 AM) cashmarket: i dont trend their playin games here
(11:57 AM) fst415: BRCM moving. i think on GOG/NOK news on cnbc just now
(11:57 AM) fst415: GOOG
(11:57 AM) trendhack: there she goes
(11:57 AM) trendhack: Friday afternoon rally anyone?
(11:58 AM) ovetus: long AKAM 33.90>>>>>>>>>>
(11:58 AM) cashmarket: yep it went
(11:59 AM) ovetus: TZOO gamo ps above 35.1862
(11:59 AM) ovetus: ALKS very strong
JerryO3434: let's go
(12:01 PM) trendhack: u missed your pop in aapl
(12:01 PM) trendhack: here comes sndk
(12:01 PM) trendhack: been a fantastic day already
(12:02 PM) BarbaraT1: QCOM reversing
(12:02 PM) trendhack: out sndk for about .22
JerryO3434: SOLD SNDK AT 62.15
JerryO3434: SOLD AAPL AT 68.15

 

[Jerry Olson]

The Banner At The Top Of T2win Page

We have a banner rotating at the top of Trade2 Win for a special Online Trading Class forming on May20th. I am offering a 30 day free trial to the Real Time Room with that Fee based Class.

I am also giving a 2 week free trial to my real time room as a stand alone offer. That will start on May 22nd.

There will be a UK Mailer going out Monday the 15th and i'll have an interesting Knowledge Lab on Monday too.

Have a great restful weekend everyone

 

[Trader333]

Grey1,

I know that you continually develop your trading approach and I am sure that many traders would be interested to know when you have entered a trade how you determine where your initial stoploss is set ? I know that you have other measures for exiting when in profit but if the trade went against you how do you determine where to exit ?


Paul

 

[Grey1]

Grey1,

I know that you continually develop your trading approach and I am sure that many traders would be interested to know when you have entered a trade how you determine where your initial stoploss is set ? I know that you have other measures for exiting when in profit but if the trade went against you how do you determine where to exit ?


Paul

Paul ,,

Yes , i have refined the vwap strategy to eliminate as much variable as possible to make analysis straight forward. One of the elimination was the use of Level2. This was done by correct position sizing, which means I no longer seek support /Resistance on the L2 as there is just enough information on immediate history ( T &S data ) to let me make a technical decision . This does not mean L2 is useless. Not what so ever . What I am saying is by widening the stop you can eliminate the useful ness of L2 to a degree which is acceptable to my analysis.


Another major refinement was the effect of market direction . I am not long enough in the market now days to let market direction to rule my strategy . hence the scalping . you see, I no longer need to know where market heads and also the effect of market spike has been eliminated again by correct position sizing . Instead of waiting for $3 run (1000 shares ) i get 30C run ( 3000 ) and guess what ... wohoooooo Not a dime of analysis on the market direction ( market is very dangerous place to leave your cash to stay for a long time. This is why most fund managers cannot even out perform the index)

I have now eliminated L2 analysis and market direction analysis . NO MORE PARALYSIS BY TOO MUCH ANALYSIS . Again my respect goes to those who use market analysis in their strategy and have made billions out of stock market. MINE DOES NOT NEED THAT

lets go back to stop loss and exit and entry .

I have no money management stop because i am a technician . I stop loss based on exit signals on different time frames .

lets say i took a long position 3200 APPL with three time frames confirming 1,3 5.( three BUY signals on 1,3,5 ) as follow

5 min signal 1800 AAPL
3 min signal 1200 AAPL
1 min signal 200 AAPL
-----------------------------------------

that is 1800 + 1200 + 200 = 3200

Then If i had a LX signal on the 1 min then i would dump 200 and if i get LX signal on 3 time frame then i would dump 1200 and so on . This is the risk management side of the strategy .

How much would be my stop loss ? well i don’t know because that depends on how good my engine defines LX ..

Now lets go to engine .

The engine consists of two parts that we have discussed in details . The first part of the engine is a pair trading which we choose two stocks at either VWAP band and hedge against each other.

The second part is a directional trading which is based on DARVAS technique as i mentioned to yourself in one of the threads here with three major difference and that

1) the signals are not triggered near the VWAP.
2) Entry is defined by Darvas rules.. if long the position is closed near upper vwap if short the lower vwap
3) Exit is defined by Darvas, MACCI , or my minimum daily target which ever comes first. HIT AND RUN ..

I think this explains it all .

I be having Ianh here tomorrow in my house for a Technical analysis chit chat and wont be trading much tomorrow how ever my target is still at least $1000. lets see if i can get it . Oh well I know i can get it .

is that all clear paul ?


Psssttttt by the way , have you ever asked an analyst about market direction and got a straight answer LOL They often say , if it goes up to hit 11000 ( example ) then it might go up another 500 to 11500 and if it does not then it might break the support @ 10 000 and it might go further down to 9000 . Well I cannot live like that. Most professional analysts are first politicians then an analysts. They need to speak VAGUE to be able to live off of their so called skills. Hence the elimination of market direction from my strategy . Most market calls given by WALL STEET TOP TOP ANALYSTS are RAIN COATS WITH DRY CLEANING LABLE ON IT ( ALL DODGY )

Grey1

 

[Trader333]

Iraj,

Yes it is clear and has me thinking, especially about Darvas. Have a good day on Monday with Ian.

Thanks


Paul

 

[samtron]

Grey1,

Thanks very much for your detailed response to trader333's recent question.

I have based my thinking up to now on a thread you started a couple of years ago titled the Complete Vwap Strategy but it now looks as if that has been superseded.
Coincidently I bought a Darvas book a few weeks back and put it on the shelf for future reading, but it knows looks as if it might get read sooner than expected.

 

[Jerry Olson]

There's a short term bounce coming

Good evening all

The markets got hit very hard Friday underneath the surface. While it looked bad it was a lot worse in the internals i watch. P&F got creamed really.

We are in a pullback or correcttive phase that is normal after a ballistic rally off of last years lows.

Each successive low has been met with a higher high on most indexs. In fact many indexs have hit all time highs over the last few months.

so a correction was due and in the scheme of things normal and natural.

I would look to short GOLD here and Crude if certain areas of support are taken out. I like NEM as a big time short and VLO as well in both sectors if we breakdown.

The semis look ripe for a bounce and so does the whole market. I would assume that any bounce is shortable for now.

My proxy for all indexs and market direction is the SPX and it's nowhere near any trouble as yet. Over time we might get to see 1260.00 but that's conjecture right now.

as for you traders out there...we are in scalp mode and will stay that way for the foreseable future. Cash is KING at night

I'll have a lot more to say as we move thru the next few weeks.

have a nice evening all

 

[Jerry Olson]

From My Sunday Newsletter to Subscribers

JERRY OLSON'S
"POINT" OF VIEW NEWSLETTER
DATED MAY 14TH 2006
THIS CORRECTION HAS MEAT TO IT

Hello out there all my trading buddies from around the globe. I hope this newsletter finds you and yours in good health and spirits. There's a chill in the air here in Philly this Sunday, spring is right around the corner though. Can not wait.

When I wrote about that Barron's front page article about DOW 12,000, wiping the smile off my face right then and there I wasn't kidding. This correction looks very ominous to me with more carnage "yet" to come. I use the word "YET" just like the FED did in their statement last week. Yet means who knows when or where we will pause, but you'll know it the very day when we stop raising rates. Meaning, we will not get advanced notice anymore about the next best moves of the FOMC until the actual announcement on the very day of the next meeting and all other meetings forever. In fact it is my contention this is exactly the way it should be stated. "All future FED decisions on rates shall be determined on economic data." In fact in all the years I have followed the FED I have never seen Fed Funds stating "Data Dependant" ever before. Ok so what does this mean to you and me as traders/investors? We are between and betwixt that's for sure. The markets are in a corrective phase right now off that disappointing announcement last week. I warned you all if you are leaning to one side or the other the surprise is always diabolical. It's almost always the opposite of what people expect. I love taking the other side of that scenario. So we are in for a bout of profit taking with a potential to at least touch the 200 day moving averages on all indexes. Last Friday was the biggest down day on Point & Figure I have seen I quite some time. I mean the internal's were disastrous with bearish implications lying directly ahead. One of the main indicators I watch the Bullish Percent of the world of Optionable stocks turned down 3 boxes and could break a triple bottom. I think in fact it will break down leading me to think the NYSE could too. More over the tech sector and the Semiconductors look sick if you ask me. It would not shock me to see the OTC reverse lower too.Traders simply are ignoring solid earnings reports and buying metals, non ferrous metals, carbon composite stocks, and anything that can be used for who knows what. The froth in these sectors which have been dormant for years and years seems ridiculous to me. However what is..........IS! The funds are shunning tech like it has the plague, and buying all types commodity based stocks and ETF's. You know folks, I am thinking that this is the most ridiculous shark feeding frenzy I have ever seen before albeit, this does remind me of 1999 as the street got nutty with Internet plays. This is the exact same feeling of the street going bonkers over nothing! And I truly mean zero!

Now I know the world needs ZINC?, I know the world needs platinum, copper, gold, oil, sugar, wheat, you name it we need it. But with all due respect do we need it at these prices? Yeah Yeah I know China and India are big consumers of all types of commodities, but heck so are we right? The worry on the street is inflation is coming back into the world markets as shown by the incessant buying of gold. Gold? Ok well maybe you can use gold bars to buy groceries, stamps at the post office, ohh don't forget when you're out to dinner some night leave a gold bar for a tip! NO wait a minute who wants gold, everyone wants ZINC! I mean is this as ridiculous as it sounds to me, to you? So let's all sell the semiconductors, those are just the guys that make everything for everything we use and need in the world, and just buy COPPER! Don't they use copper in toilet fittings? That's exactly where I think all these nonsensical commodity prices will eventually wind up RIGHT DOWN THE TOILET! Folks these big shot hedge funds that are buying and selling these stocks etf's and futures are going to get annihilated very soon. They always do! For us simple folk, just sit back and relax ok? Let the bi-polar traders out there have their fun while they can still "think". It won't be long now everyone.

 

[hornblower]

good post Jerry
you just about summed it all up
Regards
Hornblower

 

[Jerry Olson]

good post Jerry
you just about summed it all up
Regards
Hornblower

Thanks Hornblower

but we'll have to wait and see where the buyers step up to the plate. After we rally here i want to see the retest of the lows later on...

I have a plan but need to see the week to week movements unfold

good luck to you

 

[Grey1]

a fantastic day with IANH. We are up $580 lets see if we can double out money .

 

[Grey1]

Hi guys . We met our target of $1000 with $1011 win on the day .

I have a feeling IAN is going to be a VWAP man just like myself from now on . All i need is to have jerry here and make a vwap man out of him lol

grey1

 

[vegas]

Hi Grey1,

Yet again, great trading.

Wonder if you can recommend any good reads on the subject of Risk Management.


Cheers.


Anyone else have any recommendations on this subject ?

 

[Grey1]

Hi Grey1,

Yet again, great trading.

Wonder if you can recommend any good reads on the subject of Risk Management.


Cheers.


Anyone else have any recommendations on this subject ?

Any article from Michael R. Bryant is a good start and a foundation for proper money managment. He is a trader and a mathematician and knows what he is talking about.

Grey1

 

[ianh]

A HUGE Thanks to Iraj for allowing me to share the day with him! His strategy for risk management, adjusting your position sizing on stock volatility is incredible, and something that anyone who regards their trading as a "Business" should seriously consider. Protection of capital is so important in this market, and as readers of this thread will have realised, Iraj emphasises this constantly, for all the right reasons.

I look forward to being the referee if Jerry & Iraj get the chance to trade together when Jerry comes across to the UK. Can't Wait!

And as for the VWAP ENGINE ---- WOW!

Thanks Again Iraj!

 

[Grey1]

A HUGE Thanks to Iraj for allowing me to share the day with him! His strategy for risk management, adjusting your position sizing on stock volatility is incredible, and something that anyone who regards their trading as a "Business" should seriously consider. Protection of capital is so important in this market, and as readers of this thread will have realised, Iraj emphasises this constantly, for all the right reasons.

I look forward to being the referee if Jerry & Iraj get the chance to trade together when Jerry comes across to the UK. Can't Wait!

And as for the VWAP ENGINE ---- WOW!

Thanks Again Iraj!

My man Sir Ian ,

It was a great pleasure to spend time with a pro trader like yourself. I am glad we traded the market live while you were here so I could explain

1) One does not really need market direction analysis to make money day in and out as the time frame that I was trading was small to let market direction to affect my analysis . In fact we hardly spoke about market direction . ( my respect goes to those of you who use market direction analysis in their overall strategy . I know for fact that I personally cannot forecast the market movements with higher degree of certainty than 50 % )

2) That the use of L2 is not Vital in trading . It is not useless but not vital.. Immediate history can reveal a lot. ( again if you make excellent use of L2 for laser sharp entry then keep it up .. )

3) you don’t need $2 run to make $1000 profit a day , How ever you need to understand the position sizing techniques to be able to take advantage of small move. NO KNOWLEDGE OF THESE TECHNIQUES WILL RESULT IN CHASING SIZZLING HOT STOCKS WITH HIGH DEGREE OF RISK COEFFICIENT ATTACHED TO THEM. EDUCATION IS VITAL IN THIS GAME . Chasing high moving and volatile stocks with high spread is the sign of being a newbie and sends you to be a bankrupt trader. Risk management is every thing for long term success.

As you said IAN I hope I meet jerry as i said times and times before ...he is the man . He is an awesome stepping stone for those who want to learn technical analysis and intra day trading. My methodology is 100 % different to him but as most of you know there are many many ways to skin a cat. Our new traders can go to his room and watch him to post and trade in real time . No gimmick. No level2, No huge fees, No chasing of risky , high spread, and volatile stocks. just pure TA.
( i am not on commission here guys what so ever , just I think that the guy is genuine ,, that is all )


Grey1

 

[LevII]

No huge fees? Just not so huge fees??

Very good we can watch you trade for a few bob's profit

Racer, old chap / my good lady

I think you misunderstand quite fundamentally G1's intentions and motivations.

 

[Jerry Olson]

My man Sir Ian ,

It was a great pleasure to spend time with a pro trader like yourself. I am glad we traded the market live while you were here so I could explain

1) One does not really need market direction analysis to make money day in and out as the time frame that I was trading was small to let market direction to affect my analysis . In fact we hardly spoke about market direction . ( my respect goes to those of you who use market direction analysis in their overall strategy . I know for fact that I personally cannot forecast the market movements with higher degree of certainty than 50 % )

2) That the use of L2 is not Vital in trading . It is not useless but not vital.. Immediate history can reveal a lot. ( again if you make excellent use of L2 for laser sharp entry then keep it up .. )

3) you don’t need $2 run to make $1000 profit a day , How ever you need to understand the position sizing techniques to be able to take advantage of small move. NO KNOWLEDGE OF THESE TECHNIQUES WILL RESULT IN CHASING SIZZLING HOT STOCKS WITH HIGH DEGREE OF RISK COEFFICIENT ATTACHED TO THEM. EDUCATION IS VITAL IN THIS GAME . Chasing high moving and volatile stocks with high spread is the sign of being a newbie and sends you to be a bankrupt trader. Risk management is every thing for long term success.

As you said IAN I hope I meet jerry as i said times and times before ...he is the man . He is an awesome stepping stone for those who want to learn technical analysis and intra day trading. My methodology is 100 % different to him but as most of you know there are many many ways to skin a cat. Our new traders can go to his room and watch him to post and trade in real time . No gimmick. No level2, No huge fees, No chasing of risky , high spread, and volatile stocks. just pure TA.
( i am not on commission here guys what so ever , just I think that the guy is genuine ,, that is all )


Grey1

My Dear Grey 1

i feel exactly the same about you too. We trade for real, we try to help other traders and that's a good thing.

My way of scalping and yours are 100% different and in fact there are many "other" types of traders out there that do quite well using what "brung" them to the dance floor.

It matters not to me or you what it takes to make money. Your way my way their way it's all leading to the same goals, making a living trading the markets.

I did want to say that i'll have a lot more to post here on some potential serious breakdowns on my P&F indicators that buy and holders need to see and understand.

Portfolio Insurance or Put Options protection is still a cheap way to protect your holdings. I warn all long term investors be ultra careful here...

we bounce and then i think we fall further, if my bullish percents turn down and give sell signals. Take heed please!!!!!

see you in the room everyone, have a great trading day

 

[timsk]

Racer, old chap.

LevII,
Sorry to be pedantic, but your salutation ought to read Racer, old chapess. There are precious few women on these boards as it is and fewer still with Racer's knowledge and experience. Although I don't know her personally, I'll wager she'd also prefer less of the 'old'.

Tim.

 

[samtron]

My Dear Grey 1

i feel exactly the same about you too. We trade for real, we try to help other traders and that's a good thing.

Hold on now chaps - a marriage made in heaven?


Jerry thanks for the excellent article in the knowledge lab (Redundant repeatable chart patterns) its appreciated,