Trading the US the Naz/Mr. Charts Way

[Naz]

Welcome.

Just a tip.if i find something thats a little manic on the open or during the day i look at it with 25 tick/min charts.Sometimes i do this with GOOG.

HYDL is a difficult stock because of the spread.But getting down to 25 tick charts on the open gives a better picture of whats going on when i add the info to the level 2 screen data.

charts 1 and 2 are 25 tick charts.
chart 3 is 5 min chart of the same action.

Naz

 

[Naz]

The market right now.

Just thought i'd use this for anyone to post any market or stock situations that are interesting.

I was talking to Richard yesterday about the Futures hitting a fib level.This is how the Q's look at the moment.With the 50% fibonacci line holding resistance and the trend line support.

 

[frugi]

Well this was pretty weird, given the usual depth on mini-Dow ...
These huge offers persisted, fluctuated and twitched around for a while, then a drop of 10 odd Dow pips to the LOD, at which point 5k odd came in on the bid, the offers disappeared, then a minute or two later they all disappeared as if nothing had happened. I hope Rotter hasn't moved to YM

 

[frugi]

Thanks for the reply Richard. Given that screenshot (I was trading at the time) I naively and wrongly predicted a larger fall than actually occured. At least there was a fall, which vindicated my not taking a long despite the appearance of a potential setup trigger. The price bumped up several times as far as the 10184 odd level but those ludicious offers certainly scared off any buyers from raising any further. I do not think those offers were fake, for what it's worth, especially as they were not pulled having remained there for several minutes before the LOD was established.

I find DOM quite useful as a confirmation (or not) tool with YM. I use it very crudely, just looking at the total number of bids and offers on each side and if one outweighs the other by a considerable margin then I will not take the opposite side, or if I am already on it, will tighten stops or take profit. I also like to adjust stops to just above/below size for protection, as there seems to be less fakery in YM han there may be in hot stocks. Consider a column of bids of xx with one row lower of xxx - the xxx bid usually stays there until it has been absorbed or there is a bounce off it. It is rarely pulled in my experience, but I may have been lucky so far.

I am interested in your use of the word "easier" and also the phrase "saw the light". I have no doubt that a fast moving stock can deliver satisfactory profits far more swiftly than the humble YM, especially given a skilled eye and intelligent, swift reactions, but I have never been able to "tune in" to this style of trading. YM usually gives one plenty of time to take a postion and a commensurate, predictable modest reward. I suppose it is all about character and level of skill development. My system delivers safe, utterly unremarkable profits in a fairly relaxed manner and I'm happy with that (at last, after two years of failing miserably to crack the intraday arena!)

I hope this board will eventaully persuade me to join the ranks of the pattern day traders as there is no doubt that more opportunites abound. But for the moment the YM seems like a suitable niche for my mediocre tool box

 

[Naz]

I agree RIMM is worth taking a look at .

 

[Naz]

From the post market news last night.
INSP,AMZN,ITRI,GILD might be worth checking out today.
Attached is the post market move of INSP last night after the close.

 

[lloydsc]

SLAB Trade

SLAB looks interesting.
It's come out with mixed results, but with downside guidance, which is never good as markets look forward, not back. The earnings conference call was also a bit mixed and the brokers are not too enthusiastic so far.
Above all, the CEO has suddenly resigned. Now you can take that different ways, but if you were already an investor you might not be too happy - perhaps you might think about getting out today.
However, since it has gapped down already some will take the "sit tight" view, and maybe even consider adding "on weakness". I personally don't agree with that.
I shall be looking for a clear and definite trend, either up or down, if it happens I'll probably be in.
Richard

Mr Charts

If volume would have remained and the move would have resumed with an upward trend would you have still kept on looking at the stock for it to break past price at the open. It looks to me (as an inexperienced trader) that you are trading market sentiment and reaction (or over-reaction) to the news.

Thanks
Steve
Steve

 

[Naz]

My first trade today was INSP.

I took the entry as it fell under the whole number and was stopped out just above the next.I used 25 tick charts to see what was happening and used level 2 to run the trade.Profit 87c.

Naz

 

[dash riprock]

H Naz
do you scan in 5 min charts before you drill down to 25 tick charts.?
do you find 25 tick charts more accurate than say 1 min charts .?
regards.

dash

 

[millsy500]

Hi Mr Charts, Naz
Which chart time frame do you use for your setups( if you don't mind me asking).

Thanks Millsy

 

[timsk]

Hi Richard & Alan,

Naz - I don't recall ever seeing a tick chart next to an 'ordinary' time based chart before. Although the info' is the same on both, the tick chart is much easier to read than the 5 minute chart. I can see why you like them.

Clearly, the price was knocking on the door of the round number at $57.00 for a while and, it looks as if you entered long upon the breach at 57.02? As a non level II player, I would have been concerned that this was a MM trap. Many traders would be waiting for a reversal after such a large fall and, if I was a MM, I'd think to myself 'at what price can I tempt these traders to go long?' They duly buy on the break out of minor resistance at $57.00 (as you did) and I - as a MM - am happy to sell to them. Perhaps the price rises 30 cents or so and then I start to sell, sell, sell. (I'm assuming that scalpers aren't interested in a stock like this because of the spread, volatility and scale of the move). The price then drops and closes below $57.00 on high volume. It then continues to fall as the longs rush to the exits and/or their stops are hit. I, as a MM, buy back the stock at a much lower price and collect, thank you very much!

Now, that's what happens when I try a move like this! :cheesy:
As we can all see, this didn't happen here. My question is - how could you be sure that you weren't being lured into a MM trap? I'm guessing that you could see large buying pressure on the level II screen but, as those who are unconvinced of the merits of level II like to point out, how could you be sure that the bids were all genuine ans weren't going to be pulled at the last minute?

Any insights would be much appreciated.
Cheers,
Tim.

 

[DavidS]

ESRX worth being on the radar.
Richard

Good call on ESRX Richard

Did you (or anyone) manage to catch it on the way down and then back up again?

 

[Salty Gibbon]

Nice trades Richard.

As a matter of interest, did you actually use 5 minute bars during the trades or were you operating on 1 minute bars or something else ?

ESRX is a good stock to trade these days I find and is certainly on my focus list.

 

[Naz]

Hi Dash,

I have over 40 of my own main day trading set ups and strategies that i can pick from.Some of these might be trades that go for hours,in which case 5 min charts are great.Some might be very fast moves.

With the fast moves i sometimes drill down to the 25 tick charts to get and idea of what has just happened,because the 5 min chart just cant give me that info.I check the one minute chart first and then go down to the 25 tick chart if need be.After looking at that i transfer my thoughts into the level 2 screen to take and run the trade.

Naz

 

[Salty Gibbon]

For many people the best way of handling such a stock is to take a smaller position size to still remain within their maximum $ risk profile.

Yes, this is exactly what I do for ESRX, RIMM and the rest of the bucking bronco stocks.

This type of stock suits my character more than the slow movers as I find I can easily lose interest if the move goes on too long. I am a slightly impatient person and I prefer the larger, quicker moves rather than the slow gentle swingers.

 

[stevespray]

Thursday 28th April 2005 - US Stocks...

Afternoon everyone,

I thought that I'd kick off a daily thread so peeps could post an stocks which might be worth watching.

Martek Biosciences (MATK) looks like one to watch. Looks like they warned on forward sales. Suggest checking your own news on this one. It was down 40% in after hours last night dropping from its closing level of $60 right down to $31 at one point before recovering to $36 ish.

Steve.

 

[Salty Gibbon]

Surely they must have warned on something more significant than forward sales to cause such a huge move down, unless of course the forward sales are pitiful ??? Any ideas ?

 

[stevespray]

SAN FRANCISCO, April 27 (Reuters) - Martek Corp. (MATK.O: Quote, Profile, Research) on Wednesday lowered its fiscal 2005 revenue and earnings estimates, citing an expected decline in third-quarter sales due to lower demand from large customers that built up big inventories of Martek products to protect against shortages.
The infant formula maker revised its third-quarter revenue estimate to a range of $38 million to $42 million, its fourth-quarter revenue range to $61 million to $76 million, and called for fiscal 2005 revenue of $220 million to $240 million.

"We anticipate our earnings will be materially lower than the current estimate," said Martek, which added that it will provide additional details during its second-quarter earnings release scheduled for the week of June 6.

Martek said its second-quarter revenue should be about $55 million, at the high end of its previous estimate. It also said earnings are seen within its estimate of $3.4 million to $3.6 million.

 

[Naz]

MATK is the one to watch.

Naz

 

[stevespray]

Just closed two shorts +358 and +321. I dont have the mental strength to hold them any longer.

Steve.