RTT Trend Trading practice thread.

funkho - are you a GW student?


funkho Wrote:
-------------------------------------------------------
> I am very disappointed in CHK. I see that it
> peaked at 20.05 before it fell HARD today. I
> ended up getting tripped out on my stop from
> yesterday. I made a profit, but I should have put
> a sell order in close to the 20 mark for CHK. I
> have been toying with OCO orders, which are a
> limit sell on the top side as well as a stop on
> the low side. I am going to start using those
> more often.
>
> I also got the trigger on V for entry. Even
> though I'm already in MA, I'm going to go ahead
> and pick it up. MA is down today, but only about
> 5%. Will give it another day.
>
> CHK - 9 x Jul 19C @ 2.30 = 2,070
> Sold 1/22 2.52 = 2,268
> +198
>
> MA - 4 x Jul 85C @ 5.40 = 2,160
> Now: 5.15
>
> V - 1 x Jun 250C @ 18.60 = 1,860
>
> Account total: $11,038

awesomeness Wrote:
-------------------------------------------------------
> funkho - are you a GW student?
>
>


Yes, I took his 1-5 courses to start. Like most, I have strayed pretty far from his class, but I did take 1-5 when it was available via achieverschoicequest.com

Don't even know if that site still works.

-Funk

MA is recovering nicely, and V is up for me a little today.

I'm adding CME to my positions because I like it at this time of year. It also popped today as an earnings trend on RTT, so I'm in it despite a pretty wide spread.

Updates below:


MA - 4 x Jul 85C @ 5.40 = 2,160
Now: 5.15

V - 1 x Jun 250C @ 18.60 = 1,860
Now: 19.05

CME - 5 x Jun 90C @ 3.40 = 1,700

I have been using OptionsHouse, and they were purchased by trademonster... They killed my virtual account over the weekend, and I was quite busy yesterday, so I checked on the stocks of my positions. It didn't look horrible, so I just left them alone. Today, they destroy me.

I am looking up all the prices now and I'll update afterwards.

MA - 4 x Jul 85C @ 5.40 = 2,160
Now: 3.90 = 1560
-600

V - 1 x Jun 250C @ 18.60 = 1,860
Now: 14.05 = 1405
-455

CME - 5 x Jun 90C @ 3.40 = 1,700
Now: 3.30 = 1650
-50

Wow... Just torn to pieces by this. Settling up.


Account total: $9,933


Feeling pretty set bad about this whole thing at this point. Going to give it a day to rest before I get back on the bike.

Reviewing the triggers. Got one on DECK, but earnings is tomorrow. Another 4 week on AEM, so I'm going with that one.

AEM - 4 x Aug 34C @ 4.55 = 1,820

Busted again.

AEM - 4 x Aug 34C @ 4.55 = 1,820
Sold 1/29 @ 3.70 = 1,480
-340


Account total: $9,593


Almost a 20% hit inside of one day on an option WAY out in time.

I am going to continue to run this, but from now on, I am putting in stops as soon as I open the position. I can't take these hits. I have taken way too many loses over 15% and not nearly enough gains.

I'm going into SNDK as it triggered yesterday.

SNDK - 3 x Jul 75P @ 6.60 = 1980
Stop: 6.00

Thank you to those that reached out to me asking me to please repost the following. So below is what I posted before the comments were attacked. You guys be the judge. Let the moderator know what you think about their taking sides on FACTS.

Please add your own comments. But someone posting things that might cause misinformation that can cause you to possibly go down a bad path is unacceptable and irresponsible!

I am going to go ahead and write down what I said and leave it up to you to share with others.

What I was pointing out is that if you trade using earnings as the catalyst - that's great. But without the indicators it's a fools errand. Why? Because above average profits only come from correctly forecasting extreme events.

It's been a while now that analyst discovered that stock price movements were highly correlated with changes in earnings. So, people incorrectly concluded that accurate forecasts of earnings were the key to making money in stocks. Remember Gary's Dell story in 1-5?

It has since been realized, however, that it's not earnings changes that cause stock price changes, but earnings changes WHICH COME AS A SURPRISE. That's why when a company announces, say a doublings of earnings and at times it doesn't cause so much as a ripple - or they actually prompt a decline. The key question is not "what was the change?" but rather "was it anticipated?" Was the change accurately predicted by the consensus and thus factored into the stock price? If so, the announcement should cause little reaction. If not, the announcement should cause the stock price to rise if the surprise is pleasant or fall if it is not. History of these earnings and the action around them alone isn't enough.

This is our catch 22 when using a site like RTT. Everyone's forecasts are, on average, consensus. And because most forecasters aren't terrible, the actual results fall near consensus most of the time. Thus simply going contrarian doesn't payoff most of the time. You would be wrong in doing so most of the time.

If you look back on the really big money being made, we all too often think it's from making extreme predictions - but those are rarely right. Yes extreme forecasts can and do indeed make you the big $$ - but hey are also hard to make because they are far from conventional wisdom.

The last thing I will point out is not only would you have to be different from the consensus, but your timing would have to be right - and these two things are hard to do.

So I say - yes - use RTT. BUT ALWAYS, ALWAYS, use the indicators.
>



Edited 3 time(s). Last edit at 02/02/2015 02:55PM by wakeup.

I don't believe wakeup read a word of this thread... SNDK position is unchanged. No new triggers... Have a good weekend.

This is getting painful for me to read. Have you ever thought about using RTT to swing trade some positions using larger charts? If these are real money trades, you are making the brokerage rich through commissions and also killing your own confidence by going through all of this chop. I am not being critical, but it what you are doing is not working. The sign of insanity, is doing the same thing over and over and expecting a different result. Hope you figure out what works...

djpl8 Wrote:
-------------------------------------------------------
> This is getting painful for me to read. Have you
> ever thought about using RTT to swing trade some
> positions using larger charts? If these are real
> money trades, you are making the brokerage rich
> through commissions and also killing your own
> confidence by going through all of this chop. I am
> not being critical, but it what you are doing is
> not working. The sign of insanity, is doing the
> same thing over and over and expecting a different
> result. Hope you figure out what works...

It largely depends on your definition of "not working". For a while there, what I was doing was producing decent results. It has been over the last month that I have given it back. I have made adjustments in my process, but any system like this would need at least a year to be fully tested as "not working". I can clearly see that there are places where I have messed up as a trader. And the point of this thread is to point those out and fix them.

As opposed to adjusting my trading plan, I need to be strictly following what is already in place. I have closed way too many trades with over 15% losses. So I had planned see how mechanical stops work out. I had been using Options House as my virtual broker, but they appear to reset the paper trading account every day since the move to trademonster. I'm not too happy with the move to trademonster. But that's another story...

It is painful. Believe me... But the reason I'm putting it out here is make the record public, so I can't blame it on someone else. At this point, the failure of the account to grow is no fault other than my own. Plenty of trades have yielded profits. I should be up, but my inability to trade has brought me down. It would do me no good to change the trade plan if I can't even manage to follow the one that is in place.

Reviewing positions... I'm also opening AEM as it triggered...

Moving my stop up since we're in profit now.

SNDK - 3 x Jul 75P @ 6.60 = 1980
Stop: 6.40 Now: 7.15



AEM - 4 x Aug 35C @ 4.25 = 1,700

Trading can be a pain in the behind, emotions that you never knew you had will come to the forefront when you win or lose. Money is very important to us and the lack of money can cause anyone to make rash decisions to change their situation in life. I think we over think the obvious... and if we would just buy the pullbacks in an up trending market and sit through the chop we would make a killing. I really believe that the desire to be successful can cause us to throw caution to the wind and buy "hope" from anyone who can do the best job of selling us the "dream." I really hope that everyone on this forum can become successful. I have been at this for nine years, and I still refuse to give up.

After nine years, have you found what you would consider "success"? Just curious.

Because of the brokerage swap, I didn't have a "stop" sell order in for SNDK, so I'm going to assume it sold at the stop. So another one closes. The AEM position is against me, but it hasn't hit the stop yet. There are new triggers on RTT, and I'm going with V...


SNDK - 3 x Jul 75P @ 6.60 = 1980
Stop: 6.40 Stop triggered.
-60

AEM - 4 x Aug 35C @ 4.25 = 1,700
Stop: 3.65 Now: 3.90

V - 1 x Sep 255C @ 18.60 = 1,860
Stop: 16.00

Account total: $9,533

I'm really disappointed in trademonster... I was pretty happy with optionshouse before the move... Oh well.

Anyway, I'm updating positions and adding another. I am having trouble tracking my stops because I can't seem to settle on a virtual platform to use. I was switching to the TOS virtual platform, but you have to completely log out and log back in for their virtual account. What a pain... I may open an account with eoption.com to test their system out.

In the mean time, I'll just try to look up the option prices to see about stops...

I'm leaving AEM alone as it's almost completely unchanged. I am going to give it one more day, but one of the changes to my trade plan was not to linger in trades that are doing nothing. If it doesn't go my way by tomorrow, I will close it.

V is immediately going in my direction. Pleased with that. Going to go ahead and take 30% since I got it inside of one day. I could see it going another 2-3 points before resistance, but I'll just take this since it's so fast. I've been burned by asking for that couple extra points before.

Entering GS...


AEM - 4 x Aug 35C @ 4.25 = 1,700
Stop: 3.65 Now: 4.20

V - 1 x Sep 255C @ 18.60 = 1,860
Sold 2/4 @ 24.00 = 2,400
+540

GS - 2 x Jul 180C @ 9.70 = 1,940
Stop: 16.50

Account total: $10,073

No, you can log into both sides of TOS at once. I do it all the time. Also you can log into the live money on you PC, and user the trader phone app to be logged into the Paper money side. All at the same time.

RichieRick Wrote:
-------------------------------------------------------
> No, you can log into both sides of TOS at once. I
> do it all the time. Also you can log into the
> live money on you PC, and user the trader phone
> app to be logged into the Paper money side. All
> at the same time.

This is worth giving some thought to... Thanks for the suggestion... I really don't want to move my accounts around, and I may be able to tolerate trade monster if I have to..

Thanks...

Aren't you practice trading this trades anyway. No need to move accounts. Just use the Paper money side for these practice trades. Also you can get your Paper money options orders filled at the "Mark" price. For me it narrows the spread. I buy and sell on the "Mark" price for the option all the time. I've never NOT gotten a fill using the "Mark" price with TOS.

I don't use stops, but I sometimes do use the "Alert" feature, that way instead of getting stopped out I can glance at the charts to see if the trade is still a good idea, or sell the position if need be. I'm not sure if the MM can see "alerts" the same as they can see the stops, but at least it prevents them from knocking me out of the trade.
It basically puts the choice back in my hands as to whether or not I'll allow him to scare me out of a trade:-)

I don't know if our distrust of stops is such a great idea. I know that GW didn't like using stops, but the market maker makes money regardless. And while I have seen my position get stopped out and then immediately go the other way on me, I don't know if I can equate it to some malicious entity. /shrug I'm going to try out stops for a while. Maybe it will work out.

No new triggers today, although several ones from the day before yesterday popped up. I'm going to sit on it though, and just hold the positions I have. Nothing NEW is on the table, so here is the update:

AEM - 4 x Aug 35C @ 4.25 = 1,700
Stop: 3.85 Now: 4.40

Moving stop up on AEM to 3.85 since we're in profit now.

GS - 2 x Jul 180C @ 9.70 = 1,940
Stop: 8.65 Now: 10.40

I wrote this stop out wrong. It was supposed to be 8.25... I am moving this stop up also since we're now in profit on GS..

Here's something to keep in mind about "market makers": they are no longer human. The human market makers that were the bane of human traders a decade or more ago are now an extinct species. They've been replaced by warring, AI-fueled algorithms operating in dark pools whose sole purpose is to outguess each other to the tune of a penny-profit in spread per trade. HFT firms (the new middlemen) also design their algorithms to execute trades so as to receive the legalized kickbacks that accrue when you become the "trade maker" for thousands of trades versus the "trade taker." (In this regard, Scott Patterson's "Dark Pools: The Rise of the Machine Traders and the Rigging of the U.S. Stock Market" is well worth a read.) These high frequency trading schemes utilize, among other things, wild and crazy order types that render meaningless our almost archaic ideas regarding "market" and "limit" orders, especially for trades involving the tiny number of contracts we deal with. In fact, I notice I recently receive better fills for market orders than I do for limit orders. With all this in mind, I think Funkho's idea of trying out O.C.O. order types is worth a shot. Got nothing to lose here by playing with mechanized exits and stops.

BTW, I don't find this thread painful to read. Why get all tied up in knots about a simple little experiment in mechanical trading, especially when using paper money? Seems to me like Funkho is doing exactly what he set out to do in his very first post. Anyone who finds this a waste of time should start their own thread, and grace us with the results of their own experiences.

Hologram

I'm having a hard time seeing the fill price of my stop from TOS... I see that it triggered, but I am not POSITIVE that it triggered at the 3.85 price. For now, I will assume that it did. So we're out of AEM, and GS is running strong. It's up 20% for me now, so I'm going to move my stop up to 10% gain and keep riding.

I changed my mind on GS. I'm going to go ahead and take it. I am taking it because of the resistance I see on the chart at this price. I do want to keep my eye on it, but I am going to go ahead and come out of it for now. I was saying that I wanted to have price targets for the trades, and this is a good price target for GS.

I also got a trigger on DECK, so I'm heading into that one as well.


AEM - 4 x Aug 35C @ 4.25 = 1,700
Stop: 3.85 Triggered = 1,540
-160

GS - 2 x Jul 180C @ 9.70 = 1,940
Sold 2/6 @11.80 = 2,360
+420

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Stop: 7.55



Account total: $10,333


Thanks for the encouraging words from those who gave them. I do think the thread is panning out as I wanted it to. It's had its ups and downs, but I think it's been constructive...

Got a new trigger on PNRA today, so I'm heading into it. The DECK call is down, but it's less than 5% down. Letting it breath.

GS has pulled back off that resistance point. If I need to open another position, I may go back into GS, but I'm in no rush since I'm going into PNRA today.

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Stop: 7.55 Now: 8.30

PNRA - 2 x Aug 180C @ 9.40 = 1,880
Stop: 8.00

No new triggers today, but GS is attacking that resistance point again. I think I am going to go ahead and get back into it.

DECK is up nicely now. PNRA is going our way also. Nothing to do but possibly raise stops a little on each.

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Stop: 8.00 Now: 9.60

PNRA - 2 x Aug 180C @ 9.40 = 1,880
Stop: 8.00 Now: 9.80

GS - 2 x Jul 185C @ 8.80 = 1,760
Stop: 7.50

On a side note, I've been extremely pleased with TOS paper money trading. I had forgotten about great features like getting an e-mail when an order fills. The charts alone are worth it, but the other things are pretty nice, too.

Yeah I like that too.
I don't mess with the email part. I get text messages and notifcations on my phone. Even without the app running. I really like that.

It is sorta like having someone watch over my trade for me, and then tells me when my GTC order fills. Or if a trade is about to turn against me. That way I can access the charts and see if it's time to leave before I have a loss. I dig it.

Well hey... PNRA earnings is today after market, so I'm closing that one for sure. I didn't put in the OCO that I wanted on PNRA. Instead, I just had a stop. It certainly opened up over where I would have put my sell order in on it this morning. Since, it has sold off. So for new positions, I need to make sure I go ahead and have something pretty close to where I want to sell in place.

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Stop: 8.00 Now: 9.70

DECK is unchanged, so I'm going to stick with it.

PNRA - 2 x Aug 180C @ 9.40 = 1,880
Sold 2/11 @ 11.20 = 2,240
+360

GS - 2 x Jul 185C @ 8.80 = 1,760
Stop: 8.50 Now 10.00

Looking good after that break over resistance. I'm going to move my stop up, but otherwise, I'll leave this to run.


Account total: $10,693

Exiting GS today based on the next level of resistance. It's also a pretty decent profit, so I'm taking it. It's hard to image how well the account would be doing if only I had the stops in place before I started with them recently. What I mean is. If I simply closed all my losers at, say.. 20% loss, I would be doing extremely well overall at this point.

Well, that was the point of this thread. So GS gives us a nice gain. DECK is still floundering. I will give it another day to take advantage of this up market, but I am getting itchy to get rid of it.

There are a number of active trends on RTT, but nothing new has triggered today. I am going to just stick with DECK for now.

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Stop: 8.00 Now: 9.90


GS - 2 x Jul 185C @ 8.80 = 1,760
Sold 2/12 @12.20 = 2440
+680


Account total: $11,373

Exiting DECK today. Market seems really hot. I did get an entry signal on V today, so I'm going to go ahead and go in. But I am closing DECK on the move back to what I expected as resistance.

DECK - 2 x Sep 72.50C @ 8.85 = 1,770
Sold 12/13 @ 11.00
+430

V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80


Account total: $11,803

Got a few triggers today. I am going to enter a position on CHK. The V position is doing fine, so I'm leaving it alone.

V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80 Now: 18.90

CHK - 7 x Jul 20C @ 2.65 = 1,855
Stop: 2.25

No new triggers today. Positions are backing off from their highs yesterday. Market seems to finally be cooling off, but what do I know. Nothing to enter, so just updating. No stops fired, so still hanging in there.

V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80 Now: 17.60

CHK - 7 x Jul 20C @ 2.65 = 1,855
Stop: 2.25 Now: 2.65

Quick update today.

There are no new triggers for me on RTT today. I reviewed some of the ones that are in play, and I don't see something I am dying to get into. So I'm not going to open anything new today.

Got stopped out on CHK with a giant loss. Gap down today was huge. Fill price on the stop was 1.96. Horrible! Oh well, we're out of it. V is holding without much movement. I'll give it a couple more days since I have no other trades going.


V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80 Now: 17.65

CHK - 7 x Jul 20C @ 2.65 = 1,855
Stop: 2.25
Sold 2/19 @ 1.96 = 1,372
-483


Account total: $11,320

There are still no new triggers. And it seems like the market is trying to make a decision on holding these new highs. So I'm good with just staying in my V position. It lost a little ground yesterday, but it's still well within limits. Nothing to do today but update.

I am going to go ahead and replace my stop with an OCO also. I'm going to make sure I set a limit sell on the top side of all new entries from now on. I'm targeting the 280 area for V since there is no previous resistance level.

Order is in place. I'd like to give yet another nod to TOS. I'm going to be doing the bulk of my real money trading there from here out.


V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80
Limit: 23.00
Now: 17.35

Sorry I'm late today. Got mixed up in some things this morning.

Checking on positions. V is now up, but just holding steady. Not going to do anything since it is starting to move. Got a trigger on PNRA, so I'm going into that one.


V - 1 x Sep 270C @ 18.55 = 1,855
Stop: 15.80
Limit: 23.00
Now: 18.75

PNRA - 2 x Aug 160C @ 9.50 = 1,900
Stop - 8.10
Limit: 12.00