It is not always a chart thing

sometimes it is an art thing.

I know some of you have back tested and looked and studied until your eyes are sore. Some of us are naturals. My S/O is. He has been trading a little over 1 1/2 years while I have studied and studied read and read and practiced and practiced for 10 years.

My S/O can spot a trade 50 times faster than I can. He sees them. He is just simply good at this. Today with only the E signal he traded BIIB and made over $2,000.

You can get to the point where you watch too much stuff looking for that perfect trade only to miss that good trade. Or you jump before anything is there and have your head handed to you.

The last class S/O and I took of GW's Gw said trade virtual until you get 26 in a row correct.

All I know to tell you is E works and the more charts you have using E the better the trade. The other thing to tell you is best said here...

[www.bing.com]

Who is GW ?

Darcy2,

Did you mean that BIIB was a put on 9/4 Thursday? Because, I seE it around 11:36 on the 21min. (And confirmed on the 55 & 34 pitches).


Or, was BIIB a call 9/5 Friday around lunchtime? I notice the Weekly trend up.

So, I seE it on the 3min chart going up at 11:57. I seE it on the 5min up at 12:25.

Thanks for all your mentoring.

Chunk

"Never, never, never give up."---W. Churchill

S/O traded BIIB PUT from 9:38 - 11:16 on Friday. You could have done a PUT starting Thursday on BIIB... E was there. We were in the Q's Thursday on a CALL from 9:47 to 10:22.

BIIB rode the BB down from Thurs - Fri afternoon. Usually when candles are on the BB they will ride that band in the direction where they are stuck on the band. Once the candles start pulling away from the BB look for a possible shift in the direction of the move. That move can be small or a complete shift depending IMHO on what the larger charts are saying. For us we like to see a little daylight between the 5 and 10 moving average. A LITTLE DAYLIGHT!

Do I think BIIB was ready for a call based on larger charts? Hum looking at the 233/D not yet but I like that candle signal on the daily chart. See the candle close on Friday on the daily?

Daily BIIB 9/5/14



That is a hammer. From Investopedia.com "A hammer occurs after a security has been declining, possibly suggesting the market is attempting to determine a bottom.The signal does not mean bullish investors have taken full control of a security, it simply indicates that the bulls are strengthening."

Hammers are "A price pattern in candlestick charting that occurs when a security trades significantly lower than its opening, but rallies later in the day to close either above or close to its opening price. This pattern forms a hammer-shaped candlestick." Investopedia.com.

If you look at the 233 you can see that half the day it was down and the last half of the day it began to rally. This is a typical hammer formation for the daily. (See definition above)

Half day BIIB 9/5/14



This is what I do on Saturday when I get up. I have coffee my S/O makes for me and I review my stocks in my basket from the 233 and daily while I listen to Big Band and 50's rock n roll. It works for me.

SARA - GW = Gary Williams search net for him to see who he is.

Darcy,
Given the fact that you are , for the most part, a short-chart, short-term momentum style trader I was curious as to your thot process when reviewing your basket on the 233 and Daily charts? Also, is your basket still 15-20 stocks or has it expanded towards GW's recommendation of 100+ ? As always , thanks for sharing!

So sorry for such a long wait before I answered you. S/O and I were out of town and to tell the truth were not watching the market hardly.

When I look at my 233 or Daily I look for the over sold or over bought area in Stoch RSI. If I am thinking longer term I am looking for both charts to be in that area. If I am looking for a shorter term I look to see if I can find support or resistance on the 233 or 144. Sometimes when I enter a trade using a shorter chart I will look to see if I see strength in the 233 or Daily. What I look for is how much room I have in a move before I hit resistance or the Bollinger band. For instances today (8/15 @ 3:43) looking at LNKD I can see on the Daily I am oversold in the RSI but I have room to move for more down if I use the 50 moving average or Bollinger band as support. Then looking at the 233 I can see it is nearly done for the day and I would not consider this trade for a stronger move down but more of a flatten trade. Usually options do not moe well in situations like that. WYNN on the other hand looks to be more interesting for a put using the Daily and 233 since I see on the 233 the 20 moving average is acting as a strong resistance. If this trade on the smaller charts became a call rather than a put; it is one I would enter quickly unless the candle gets above the 20 moving average on the 144 or 233.

The 20 and the 50 moving averages are strong resistance and support as are gap lines on the 233 and Daily. I mark gap lines on the 233 and Daily and take an eyeball measure of where the center of that gap line would be. The moves using the full gap and half gap are very interesting for support and resistance and shouldn't IMHO be overlooked. Once these lines are broken up or down more than once they are not as important.

GPRO on the Daily and 233 is interesting. I think this will be a good stock for a whille to trade. It is a new entry in my basket. I have stocks that have been in my basket for a long, long time. However I do switch around on some taking some out and putting new ones in. I prefter NASDAQ stocks because they move more and of thse NASDAQ stocks I prefer tech. I like Pharma for peaks and then I will keep them in my basket for a month or so because sometimes you can trade them up and down for a short period IF THERE IS A PEAK OR SLAM.

My basket is as follows:
Q's, MA, APPL, NFLX, AMZN, BIIB, TSLA, LINK, BIDU, VZ CF, WYNN, GPRO, GMCR, Z, CMG, GOOG, GOOGL, and BABA (new IPO). That's it. My basket does change but in one year I have not removed Q'S, MA, AAPL, NFLX, AMZN, TSLA, BIDU or CF. I have from time to time removed and then put back all the rest. I have a quote sheet where I keep those I remove from my main basket. I put them back when the charts start looking good. CMG I am expecting a move soon but if the volume doesn't pick up it will be removed to my secondary basket. I guess you could say they get put in time-out! I like stocks with volume in the M's not K's. They simply MUST move or else I am tying up my money watching paint dry. MA is a stock that has been a dead horse for sometime so I have threatened it with expulsion but so far it doesn't seem to care.

I add pharma when I do a peak trade on it and will keep it for a short time because usually after a peak trade I can get about 2 or 3 more trades from it. I don't trade slams but I will add those pharma stcok when they have a slam because of the dead cat bounce. That is usually good for about 2 trades....first one up and seond one down.

The thing I like about qcharts is I also have a "hot list" which I have used from time to time to find stocks on the NASDAQ that are way up or way down. I will say I have never traded any of them. This list is endless. If I find one that has good volume and I like the chart... a strong Daily and 233 with good moves on a 55 or 34 I will add it to my main basket. If I do not trade it within a month or so I put it in my secondary basket. That seconday basket gets looked at usually at night and if any of them look dead out they go. Right now my secondary basket contains zero stocks.

As far as my main basket...I will never have 100 stocks...never. To me that is way...way too much so much it would get confusing and by the time I looked them over the market would be closed. S/O has about 17 or 18 but we have found we trade the same ones over and over and over.

BTW add BABA to the list after the IPO within a few weeks I am hoping it will have options and I'll be on that one if it does.



Edited 1 time(s). Last edit at 09/16/2014 08:39AM by Darcy2.

Darcy,

Wow, your last post here was super helpful regarding support and resistance on the Daily and 233!

I had a question for you; Do you ever enter a trade if your 55 RSI is already overbought or oversold, but your smaller charts give you an entry signal? If so, can you describe your thought process there? I am often hesistant about entering trades with the 55 in this overbought/oversold condition, only to see the move continue and the 55 RSI just bottoms/tops out.

(For example; Entering a call with 55 RSI already above 80, or entering a put with 55 RSI already below 20.)


Thanks

Thanks for your response, always good for a "nugget" or two !

Dynamike, I saw a possible trade today on V with everything appearing to be there, HRFP & E on 21,34, & 55 , E on 10 & MF up but 2 things made me leary about it. The first thing was it was around lunch, could this be a headfake because it was lunchtime, and the second was what you are saying about it being in the oversold area on the 55. Also noticed that the adx was kinda down to flat and not really turning up yet. Turns out it would have worked.



Edited 1 time(s). Last edit at 09/16/2014 06:42PM by TCB.

Darcy,

Regarding the 100+ stock question I think you give yourself far too little credit. You took a system that, by your own admission, didn't really work for you originally. You lost many baskets, went back to the drawing board, read all the books, and now have something that works on timeframes that you are comfortable with and appear to be doing very well. I am sure if the 100 stock suggestion was made back in the day then you would have figured out a way to make it work.

To that point I am going to mention this here since it was brought up for anyone that decides to read the thread. I have seen the 100 stock question asked a couple of times. I am going to throw this out there for anyone that feels the 100+ review is a daunting task. If you are a big chart trader then you need 100 or so to give yourself plenty of opportunities throughout the year. All stocks do not move at the same time or in the same seasons. It is the responsibility of the trader to narrow their focus to a certain group as the year progresses. If a big chart trader has a basket of 5 to 10 then you have to average 1 good trade for each stock per month to meet the minimum suggested threshold (number of trades per month). That simply is not going to happen most months. Some move well throughout the year while others only move well certain times each year. That also assumes you have a trade. All technical signals are not necessarily a trade. I personally average around 140 stocks and ETFs each year when putting together my basket. I then narrow the field by looking at historical tendencies and best movers (stocks moving right now) to maybe 30 to 35. I update that list twice a month around the 15th and 30th (easy to keep up with). I find that the top 10 or 15 stocks seem to stay in the top spots throughout the year (same stocks Darcy and others mention in this forum). The remaining 20 or so fluctuate. I can then go through that list of 30 to 35 at night a couple of times each week in 5 minutes or so determining which stocks I want to watch over the next few days. At that point it is about knowing what I am looking for. I never have more than 10 or so on my watch list on any given day. One quote that sticks with me to this day "You should never be surprised by a trade. You should always see it coming." All of this does not mean I always catch the best moves. Some stocks that do not make it to my watch list move great but if I could not see the move coming and did not have confidence in the potential set up then there was no reason to have it on my list.

Maybe it helps someone and maybe it doesn't. When I see the question I might be taken it out of context. As a big chart trader I would not want any less than 100 in my stable for consideration but reduce it down to a manageable list at any given point in time. A short chart trader focusing on 55 mins and less can do very well with 10 to 15 because the charts set up more frequently. A big chart trader is lucky to get a couple of trades per month when the stock is moving. If someone is unsure how to reduce a large list then a starting point might be to consider a 6 week ATR and rank order in descending order. At least that way you will be looking at the top "X" movers over the past 6 weeks. If you are an RTT subscriber then considering stocks with upcoming historical tendencies may be the way to go. It is a personal choice. Just a thought and something to consider.

Last but not least Darcy's suggestion about the fire symbol is a wonderful thing. For those using TradeStation there are built in scans in the scanner that do roughly the same thing. The difference is that Qcharts fire symbol appears to have a built in minimum volume threshold that is not included in TS. When I add minimum 100K volume to the TS scan I get almost identical results to the QC fire symbol (yes, I did my testing before switching). :-)

NCT



Edited 1 time(s). Last edit at 09/16/2014 05:28PM by NCTrader.

Dynamike Wrote:
-------------------------------------------------------
> Darcy,
Do you ever enter a trade if your 55 RSI is already overbought or oversold, but your smaller charts give you an entry signal? If so, can you describe your thought process there?

Yes I have but it all depends on the E signal. If the 55 is in that area I look at the 34 and 21 to make sure there is no resistance. Resistance can be moving averages, Bollinger bands, news and gap lines that I place on my charts. You could be setting up for a small pull back on the 55 before you would get another move...or the candles could be stuck on the Bollinger band on the 55 even with the RSI in the over sold area the stock will keep going up. In cases such as this you really need to examine all the studies paying close attention to the ADX and money flow IMHO.

My suggestion would be this....if it makes you uncomfortable don't trade it! Pay attention to that small quite voice inside your head. HOWEVER trade it virtual. Virtual trading is the best way to learn what you see and what you thought you saw. Write down on a sheet WHY you traded it, what you saw on what chart, and why you got out.
I still trade virtual. I write down who, what, where, when and why (journalist in me). The only BAD THING about virtual trading is you can get stuck there. DON'T!

ADD: Watch for pull backs in the case like you mentioned. Pull backs can really hurt a trade that is really looking like it would go your way.

NC Trader..thanks for the nice words.



Edited 1 time(s). Last edit at 09/17/2014 09:03AM by Darcy2.

Thanks, Darcy Valuable advice as always!