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The PennyDoctor ELTP
http://stockcharts.com/c-sc/sc?s=ELTP&p=D&b=5&g=0&i=0&r=1400097880093
I am not really liking anything today. With anther promo halt this morning and the pot stocks continuing to lag, I think the OTC is going to have a long quit run. Not sure if I will pull the trigger today on any of the ones I am watching:
FNMA, NASDAQ:ARTX NASDAQ:SPEX NYSE:XON NYSE:IRM NYSEMKT:UEC NYSE:TC
ThePennyDoctor CLNE and WPRT Natural Gas Plays
Take a look
A man of his word...Thank You for the postings!
Made some money this morning from the watchlist I posted yesterday. Today, whats old is new again as the hot tickers I am watching include FNMA, PLUG, FCEL and BLDP
Markets up strong today. I am watching a few from my scanner:
NASDAQ:PLUG NYSE:YGE NASDAQ:CPST NYSE:ARO OTCMKTS:TRTC NYSEMKT:APP NYSEMKT:ROX NYSEMKT:XXII OTCMKTS:CIHN OTCMKTS:VPCO OTCMKTS:VPOR NASDAQ:CSIQ NASDAQ:ARTX NYSE:CPE NASDAQ:DRTX NASDAQ:PXLW
OK - I will post any good picks I find
I'm sure a lot of us would still appreciate you posting your thoughts on the Nasdaq/Amex stocks here...since some of us DO play both!
Well, PGFY turned out to be a shit show. Never seen the execs get in such a public fight over a P&D - need to have all the insiders onside before starting one. The damn bad news on the night of day 1 basically killed it anyway. There has been chances to make some money on this one, but overall, it has been crap (too unpredictable). Of course, don't hold this one overnight as it should get halted at some point.
I am the idiot who sold NEWL today at open flat - I picked it up EOD, and dumped it immediately looking for the gap up. Didn't loose money, but missed the 30% pop. Oh well - keep a watch on this one - it will stay nice a volatile for the next few days.
The OTC looks shitty right now to me - the post-PHOT halt era is still in effect, and with the failure of PGFY, looks like it will be sometime before nice easy profitable trades present themselves on a recurring basis again. I will be focusing on the Nasdaq/Amex again for a bit until things settle.
Looks like PGFY is the next big P&D. I think it should give a chance to profit. I will make a decision on it EOD today; did not get in early like some on close Friday. It is stock twits, who has basically replaced APS as the #1 pumper in the game.
Penny stock blog below - I like ELTP for tomorrow; chart looks great:
ELTP has moved to the top of our watch Thursday, for a continuation higher, after it's strength today. Lets hope May starts off like April ended.
ELTP – Momentum/Potential Continued Breakout - (Elite Pharmaceuticals Inc.) - closed up 13.54%, at .494 per share, with more than 5.1 million shares exchanging hands Wednesday. Elite Pharmaceuticals, Inc. specializes in the development of oral controlled release products, such as delayed, sustained, targeted and pulsatile release tablets, pellets, capsules, granules and powders. The Company’s primary focus is in the therapeutic areas of pain management, allergy, cardiovascular and infection. ELTP made a greater move today than we had originally anticipated; we weren't expecting the stock to open a cent higher and continue on up the rest of the day. It's nice when things turn out better than expected, and hopefully some of you were able to reap the rewards. ELTP looks like it might continue higher, after seeing an increase in volume today, closing not far off today's high of .51. If ELTP can push through .51 with stronger volume tomorrow, it could test .60 on this move. Keep it on close watch.
COPY – Momentum/Potential Continued Breakout - (CopyTele, Inc.) - closed up 17.24%, at .34 per share, with 806,260 shares exchanging hands Wednesday. CopyTele, Inc. ("CTI") (OTCQB: COPY), a company specializing in patent monetization and patent assertion; develops and acquires patented technologies for the purposes of patent monetization and patent assertion. COPY announced today a settlement with Logitech, Inc. over a previously filed lawsuit, which was received well by investors today; read more, HERE. By closing just off it's session high of .345, with a nice increase in volume, COPY could test .40 or higher tomorrow. Keep the stock on close watch.
QASP - Potential Continued Bounce - (Qasar Aerospace Industries, Inc.) - closed up 29.41%, at .0022 per share, with more than 259.8 million shares exchanging hands Wednesday. Quasar and its subsidiaries are involved in aviation and aviation related businesses and is moving forward toward entering the MJ industry. Shares of QASP confirmed support at their 50 day moving average, trading down to that level near .0013-.0014 for the second day in a row, and made a nice bounce off that level today. QASP closed at it's session high of .0022, with a slight increase in average volume, and if it can push past .0024 tomorrow it could move on to .0028-.003 before meeting more resistance. Keep the stock on close watch.
I only post picks I feel confident in and the only time I post a ticker is when it's going to go...I posted Liga in here at .003 it's tripled...ntek at .04 then hit .18 3 weeks later. Check the chart...you think .01s are coming back?
Yes it was promoted last year heavy for the main reason to raise capital and bring awareness due to the fact 2013 was it's first year in operation. I don't think you can count it as a P&D if it hasn't had one for over a year. I have been to the plant in Cincinnati and it's the real deal with contracts with goodwill...check goodwill site and I also found contracts from Broome and Steuben county in New York for their Geneva facility
I consider EWSI a P&D ticker - was pushed heavy last year by several promoters and had a run. I traded it on its last run - it is still far off those highs with this recent bounce. I will take a look at it again for a short-term trade if it can keep up volume. It has not even been able to break the top traded list, and I tend not to bother with such tickers unless the trend is clean and easy.
Um..what about ewsi check pump n dumps nothing I got some great info if your interested. Ewaste has a lot of cash in it. Ewsi has operations in 3 locations in the US and have deal struck with Cerebra in India. It's actually a real otcqb company and should have at least 50 million in revenue in 2014.
Made some money Friday on PHOT trading the typical post halt crash and bounce - nothing huge as it was hard to get filled on the greys. Overall, April has been a crappy month - I have not lost anything, but have only made peanuts, especially compared to the first 3 months of the year. I need a new sector trend to develop - it will come in time. I hold some BTCS and VHUB for quick trades right now - nothing else from the OTC. Hopefully, some new decent promos start coming before we get towards the summer months.
Ewsi...Anyone get on it when I posted it at .015 it's up to .022 and climbing
OTC volume has been pathetic since the PHOT halt. Reminds me of the drop off in volume after the demise of APS. I think PHOT starts trading again Friday - I don't expect volume to pick up again until the following Friday, and even then, it will probably take some time to reach pre-phot halt levels.
I am having a hard time finding momentum trades this week; have only done a few small trades. I need the market to start trending in a clear direction again - it will happen in a matter of time.
Press Releases Swordfish Financial (SWRF)
10 wells Swordfish Financial, Inc. will own 100% interest
Nice bounce back day for the pot stocks and big board today. I picked up various tickers and hope the momentum carries over. AH's is down a touch but nothing serious - normally the movement of the market for the day is established by 8:30 in PM trading. I expect the pot stocks to continue to rally in the morning regardless of how the overall market is moving, but we shall see.
Markets are closed Friday so tomorrow will be it for the week.
Today was a mostly red day for OTC stocks, which could be directly related to the suspension of shares trading in PHOT (Growlife, Inc.) at the market open that likely made investors question other positions. Hopefully most of the beating took place today, and stocks bounce back tomorrow. Of twenty stocks trading with the most dollar volume below $1.00 on the OTC Market today, only one closed green.
FROZ - Potential Continued Breakout - (Frozen Food Gift Group, Inc.) - closed up 57.89%, at .015 a share, with more than 113.7 million shares exchanging hands Thursday. FROZ is a publicly traded company that previously has sought to help launch specialty gift and food products in return for revenue and royalty streams with scalable distribution platforms. FROZ is currently invested in sendascoop.com and Global Specialty Products with the MicroRoasters brand. FROZ is diversifying its business model at the current time, and seeks to add new revenue generating businesses to its portfolio, including MotoVox, Inc. While most of the OTC was taking a beating, FROZ made it's highest close of the year and looks to test it's 52 week high just below .018 tomorrow. If the stock can push through, it could test .02 and gain a nice bit of momentum. Keep it on close watch for follow through Friday.
DPSM - Volume/Promotion – (3D Pioneer Systems Inc.) - closed up 8.20%, at .79c a share, with 634,674 shares exchanging hands Thursday. 3D Pioneer Systems Inc. is both a diversified technology company and a creative design house. Our motivation is to deliver 3D printers that are unparalleled in consumer-friendliness, speed and print quality. We are also developing a portfolio of mobile games. DPSM was featured on our blog Sunday night where shares started the week at .65c, having been on our watch a week from today when shares were trading at only .55c, and closed just off another new high today of .80c. If the stock breaks past .80 early tomorrow, it could be well on it's way to another nice green day. Continue to keep DPSM on close watch.
BCCI - Momentum - (Baristas Coffee Co. Inc.) - closed up 30.64%, at .113 a share, on more than 7.9 million shares traded Thursday. Headquartered in the Seattle, Washington area, Baristas Coffee Company, Inc. was formed to create a national brand of drive-thru espresso stands. BCCI is accomplishing this by acquiring established businesses that fit its model, opening new locations, and by franchising. Baristas has separated itself from the competition with its "theme" of joining attractive female baristas in entertaining costumes preparing the finest beverages available on the market. BCCI was also featured on our blog exactly a week ago from today, when shares were trading at .095, and continues to trend higher. We mentioned then the resistance at .12, which the stock tested today with a high of .119, and if it can push through that level tomorrow it could end the week on a strong note. Keep it on close watch.
Just found out that PHOT got halted Thursday - that is brutal. The pot stocks were of course all scams, but they had great runs. PHOT was arguably the flagship of the group, usually the heaviest traded anyway. With the other pot stock halts (CANN, PTOG, etc.), it is clear now if it was not already that a pot stock should not be held over night. Hopefully the SEC does not halt any other OTC non-pot tickers in the short-term or the OTC will be basically ruined.
On a side note, I made money on CANN post-halt day one and am really looking forward to PHOT post halt day 1. PHOT has a huge trading following. It should open super low (at least a 90% discount), but I think it will get to an 80% discount at some point during day 1. This is of course a very high risk trade on the greys, but I have done will with these in the past and will try again. I would not suggest others trade the greys unless they have experience with them.
Markets, including the OTC, bleeding red big again today. Almost all of the top OTC traded tickers are down, and every damn sector on the big boards. I should have loaded up on TZA at close, but did not pull the trigger. I will be looking for other shorting opps today. I will go short some tickers EOD if the market continues to fall during power hour.
Yes rough day but looking for a bounce soon. Looking at all the rsi its seems to be close to bottom but who knows.
Thanks for the tip - I will take a look at my biotech sector lists. Rough day today on the markets. I am down a little today b/c of the MCIG gap down. May be best to wait for tomorrow, but for now, I am watching:
OTCBB:NNRX OTCBB:DPSM OTCBB:BRPC NASDAQ:BPTH NASDAQ:IGTE NYSE:RT NASDAQ:ORMP
Whats up doc, its been awhile.
Biotechs had great last couple of days after a terrible month. Most are still very low and rsi are just turning up. Most have had 5% - 15% per day each of last few days. Ill take that anytime.
I have been trading the entire time since I was last actively posting. Just did not find time to post. The year has still been good to me, but the last 3 weeks have been slower than the rest of the year. The pot stocks are a bit rocky right now - especially with the halts - and the big boards have been a bit wonky.
Here is what I am looking at today:
NNRX - back from the dead. This one is high risk high reward. I will wait until EOD to make a call. This is of course an old p&d ticker that had a nice run over a year ago now I believe.
Other OTC tickers I am considering for today - DPSM, MDCN, MCIG, rcha, mine, erbb and hemp.
On the big boards, I am looking at:
NASDAQ:TLOG NASDAQ:FEYE NYSEMKT:AMPE NYSE:KT NASDAQ:CSUN NASDAQ:CSIQ NYSE:TSL NASDAQ:SNTA NYSE:YGE NASDAQ:EPZM
Please...NO sorry necessary! It's just that it's somehow not quite the same when you're gone!!
Pearls of wisdom that we can trust, AND no hidden agenda...THAT'S it!!!
Sorry about that - I have been busy the last 2 weeks. I will start posting again shortly.
Trust me...me too. I have a conscience as well..... I never post on any stock that I don't feel 100% confident on....checking the EWSI chart this thing has bottomed out in my opinion. Audited fins are coming out and hopefully will show true evaluation if you need any DD let me know. I bought about 1.3 million shares so far and will continue to add at these levels. Again I rarely post unless I think a stock has bottomed out and will definitely go up. The issue with this stock has been dilution in past couple months but has slowed down because they opened up a huge ewaste plant in Cincinnati Ohio which will generate about .50 lb of revenue. The facility can recycle about 75 millions pounds a year and has a contract with the goodwills in the area for about 40 million pounds a year....I am not saying buy buy buy....do some DD and put on your watch list....the board is really toxic with paid bashers.
Melly, with my apologies...It really wasn't directed at you...it was an "off the cuff" comment about the board. Apparently, just not enough coffee yet in the wee hours out here on the West Coast
This USED to me one of my "go to" boards for great information and education. I should have just asked what the hell happened around here instead?!?
If check my history I rarely post usually on a couple boards...look at my past history posting on this board NTEK at .009...was just in the teens last week. LIGA was at .003 is bouncing around .0075.....posting 3 stocks in a year isn't a lot and I'm not a pumper check the chart
Sad...this used to be a GREAT board...now just pumpers stop by!
Ewsi is bottomed out check the chart and audited fins are coming out
MRIB is poised for an elastic bounce. Tomorrow is the ex-date for a 5% share dividend and it's presently being discounted more than 20% from recent highs.
Well, I was actually still up $9K for the week so it was still good - just not as good as I was hoping. I must have been unclear in my post; just meant I lost $6K in PTOG - that is all I had in that ticker when it got halted and I consider halts a write-off, although I do hope to retrieve $600-$1K when it resumes trading on the greys.
Up $2.5K so far this week, mostly b/c of MGNA this morning and FNMA on Monday morning. Was up more, but I held on to some pot stocks too long this morning and they pulled back. The sector suffered today as SA put out a trashing article on PHOT, which is the top traded pot stock. Interestingly, the SA short sellers only brought it down 10% even after its big run. I will be watching the sector tomorrow to see if it bounces or dips. On the sidelines right now as it is too hard to call - I expect PHOT to dip and rip, but we shall see.
Ouch! That's one heck of a turn...up $15K to a $6K lost. Sorry to hear that.
Been there myself way too much until I finally exited the market late last year to work on my trading / investing education.
Good luck, Penny Doctor.
Cannabis Related Stocks On Watch For Tuesday 03/18/14
NEW PICK COMING VERY SOON: LAST TWO PICKS SURGED HIGHER ON RECORD VOLUME; SIGN UP FOR OUR FREE NEWSLETTER ABOVE TO BE AMONG THE FIRST TO RECEIVE OUR NEXT WINNING PICK!
Hi Everyone & Welcome New Subscribers,
We certainly kept the green in St. Patricks Day, with each stock on our watch list for today closing up significantly, and we're keeping most "green" related stocks on watch again for tomorrow. CBGI, PHOT, and ERBB combined for gains of more than 130%, and look to continue higher tomorrow.
We're going to post our list of cannabis related stocks in order from our most favorite to least favorite for you to keep an eye on for a trade Tuesday.
1.) ERBB - Tranzbyte Corp.
2.) PHOT - Growlife, Inc.
3.) MCIG - mCig, Inc.
4.) GRNH - GreenGro Technologies, Inc.
5.) CBIS - Cannabis Science, Inc.
6.) TRTC - Terra Tech Corp.
7.) EAPH - Easton Pharmaceuticals, Inc.
8.) TTDZ - Triton Distribution Systems, Inc.
9.) MINE - Minerco Resources, Inc.
--------------------
They missed TAUG, which is my current pot stock fav. I also like PHOT, EAPH, ERBB and TRTC
Yes I'm stuck in POTG also.Been buying EXMT Don't see it on any scams,and it's listed on the weed index.Know anything about it?Thanx
The SEC has finally fired a shot at our beloved pot stocks, and I got caught with my hand in the cookie jar. PTOG got halted this morning. I was up $15K this week, but will loose $6K on this damn halt. For all, be careful holding any pot stock over night - they are of course all BS and any of them could be halted. The only thing unique about PTOG is that it was an old P&D ticker that recently entered the pot industry (well, according to its PR anyway). In other words, be careful of the many pot stocks that a rehashed p&d tickers. The new promos should be less likely to get halted in the short-term. The SEC already has files on many of the older p&d's and can turn around a halt quicker - I have seen this many times over the years in non-pot stock related promos where an old promo ticker is the subject of a new promo.
Another very profitable day - I cashed out nice on BLDP, FNMA, MEET, OPTT, OSHL and UQM. Went back into FNMA on the bounce - easy money as it dipped below FMCC for a period of time and it has never closed below FMCC.
At close, I held TAUG, PHOT, TRTC, EAPH and some OPTT. Big boards looked hurting EOD. On the OTC, the pot stocks remain strong as ever.
FCEL, PLUG and BLDP finally crashed today - that was a very profitable run. Keep a watch on them. I am hoping they crash again tomorrow, and then dip and rip on Thursday; I will play the bounce if it works in that typical fashion.
Awesome day today - really cleaned up on those stocks I listed Friday as I picked a bunch of them up EOD. Keeping PLUG, FCEL and BLDP on watch - I cashed out big profits today - but may not buy back today as I think FCEL reports earnings today and I don't trade news.
I rely on my screener for big board picks - here is what I will consider today:
NYSEMKT:CVM NASDAQ:HSOL NASDAQ:BLDP NASDAQ:PLUG NASDAQ:FCEL NYSEMKT:MEET NYSE:COO NYSE:CPE NASDAQ:DLIA NYSE:EBS NASDAQ:GIGM NYSE:HDB NYSE:KFY
HMTF - anyone know this one? On a big run - I am thinking about picking up EOD for a Monday gap play if it is running EOD. I don't love these plays that have gone up too much in one day so I won't put in much if any.
The gift that keeps on giving - made some nice money of PLUG, FCEL and BLDP again today. Best part was, PLUG ran first and I was able to buy the other two first knowing they would follow (as I have posted here before, these run in a group which is the perfect setup for easy money - similar to the solars and shippers in 2013). Keep and eye on these - I cashed out profits for now but will watch again EOD. Also sold FNMA and FMCC near there highs today - used a trailing stop strategy.
Had a good day but I am a little ticked since I sold XGTI and CANN early after open - they went on to go up 100% and 50% respectively. I have to be more patient with some of my tickers and let them ride with a stop - at least big board tickers. Anyway, I hold the following now: DRYS, EGLE, a little XGTI, PPHM, XON, RGSE, KNDI, BV, MPO and AVAV (and that is just the big boards - I guess I liked a lot of tickers today).
On the OTC, I have RVDO (new big promo I have hope for - could be big tomorrow), MCIG, FSPM and VPCO
Well, I said keep an eye on FCEL. Looks like its my lucky day as this one is up 30% PM - to be honest, I don't even know why it is up so damn much at this point. Anyway, for those not in yet, I suggest PLUG and BLDP for sympathy pops this morning. Each of these 3 has gapped and ran for the past couple days. I will probably cash out FCEL at open as it is up so much - I may pick up BLDP and PLUG (I already hold a little PLUG still, but nothing material).
Had some nice accrued gains into close - should be a good open tomorrow but we shall see. From the OTC, I hold ONCS and MDCN.
I got beat up on Monday - worst loss in 2 months - but made 2/3's of it back today, mostly with PLUG, FCEL, and BLDP - these 3 move together; keep them on watch. I need to earn more this week to avoid my first losing week of the year. Damn Russians.
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The grim reality is short-term trading and especially day trading can be hazardous to your wealth. Ninety-two percent of day traders trying to scalp loose money. Only eight percent are successful. Out of the eight percent, only two percent of the day trading public make money on a consistent basis. Why do 92 percent of day traders fail and what makes eight percent successful? Let's take an honest look at day trading without the hype and emotion that surrounds the subject and find out what it takes to be a successful day trader.
We go to school, gain an education, become employed, or start our own business. We learn what we need to know to be successful, but nothing in our education or work experience provides the comprehensive knowledge or psychological control necessary for success as a trader. Unfortunately, it's human nature to assume that if we succeed in one area we will automatically succeed in another. Most people who enter the market with the idea of becoming traders have a feeling of invincibility, superiority, and no clue of what they are about to experience. The dream of quick money and financial success can very quickly become a living nightmare. The first step in becoming a successful trader is to understand why so many day traders fail. Answer the following questions:
If you're saying, "Not a chance," guess again. That is exactly what you are doing when you start trading for the first time. You must prepare yourself and realize that you are going to be up against the best traders in the world. Training, experience, psychological control, and a realization that your are not invincible or smarter than the market will lead you to success. Wall Street is paved with the bones of those who did not learn this lesson until it was too late.
Most new traders have the wrong focus. If money is your focus, you have little chance of success. Many new traders look at trading as a way to escape a job they hate. They know they have to make a certain amount of money to pay the bills and this becomes a psychological guillotine. When the trader fails to meet the goal, he begins to push trading beyond his true ability and skill. The result is a series of losing trades that could have been avoided if the trader had the correct focus. Your focus and the measure of your success should be based on following the trading plan, not money. If you follow the plan each day, you are a winner. If the focus is money, it leads to emotional decisions and emotional decisions lead to uncontrolled losses. Successful traders make decisions based on fact and analysis. Do this and money will follow if your methodology is a sound one.
The Mathematics Of Trading
Almost everyone has heard the term "cut your losses." Nowhere is this lesson more evident than in day trading. Statistics tell us that most new day traders lose over $21,000 dollars in their first three months of trading. If they use leverage the average loss rises to more than $45,000. Nothing supports the reasoning for not overtrading and cutting a loss more than an understanding of the mathematics of what it takes to recover from a previous losing trade. If you were down 15 percent, you would need to make 17.6 percent in the next trade to breakeven. This does not cover slippage or commissions so in reality you would have to do far better than 17.6 percent. Now, imagine making 30 trades a day and most of them losses. It has been my experience that it is extremely difficult to recover from any loss of capital above 25 percent for most traders. This is because it takes 33.33 percent to recover in the next trade. If a trader has allowed the trade to lose 25 percent they simply are not managing the risk. I have known traders to have 10 winning trades and lose it all by not managing the risk on two trades. The successful trader is ruthless about cutting a loss because they understand the mathematical relationship of trading. I have been in this business for a very long time and if I have learned one lesson it is this-once you enter a trade you are no longer a trader you are a risk manager. Never forget this.
Not Every Day
One of the interesting observations I have made over the years about day traders is that they have great difficulty not trading. Who ever said every day was a trading day was wrong. Only make trades that have a high probability of working out. This means that successful day traders make fewer trades and do not trade everyday. Look for strong trending market days and trade stocks that trend with that market.
Many day traders are addicted to the action and making money has little to do with their true reason for trading. These individuals are not traders, they are gamblers. Action addicts will lose as many times as necessary just for the adrenaline rush to win once. Most successful day traders make no more than three to five high probability trades per day. It has been my experience that if a trader makes over 18 trades a day, they are in all probability gamblers not traders. Successful day traders know that not everyday is a high probability trading day and overtrading can be hazardous to your wealth.
High Probability Screening
Most day trading cowboys will shoot at anything that moves. In most cases they walk into their trading room with no game plan other than to listen to the news and trade the momentary euphoric hype in the room. If this is your preparation for battle, your days are numbered and the following might appear on your head stone: "Here lies the bones of a day trading master. He was fast on the mouse but somebody was faster."
Screening for high probability profitability trades is of the utmost importance. We teach our students to quantify and select the three highest probability trades that have a reward-to-risk ratio of 2.5 or greater. The screening process looks for and selects the maximum momentum acceleration points on a given security. Out of a database of 500 stocks, our traders select the three highest probability profitability trades for the following day. Ninety-eight percent of a traders success is due to the work done the night or day before the trade occurs. Success in day trading means a lot of work and very few people will do the work necessary. Losers are always looking for the easy way out. Success is directly proportional to the amount of work you will do that no one else will.
What Kind Of Day Trader Are You?
One of the keys to successful trading is to understand that you are an individual and as an individual you have strengths and weaknesses. One reason that day traders have such a high percentage of losses is that they are trained to use a standard one-size-fits-all approach. Unfortunately this approach is a day trading style known as scalping. A scalper trades for small fractions of a point-from 1/16 to 1/8. This style of trading has a 92 percent failure rate. Most people do not have the psychological control or ability to successfully trade with this strategy. Another strategy known as intraday trend trading has a much better success rate. The intraday trend trader will stay in a trade until the trend reverses. This could take a few minutes or several hours. This style of day trading makes time your friend and enables you to trade for points instead of fractions. The trend trader is far less likely to be whipsawed out of a trade because the focus is on staying with the trend. Notice that I did not say momentum. Momentum is usually associated with scalping too close to the axis of volatility. This volatility is usually displayed on a NASDAQ Level II screen. Years ago this information was very useful for traders. Today it is not as important as it once was and in fact, professional traders use the day traders own out-of-date information about the Level II screen to lure scalpers to their doom. If you are trend trading intraday, Level II has less importance and your chance for success is far greater. Traders trading this style tend to trade much less and statistically have a more successful outcome. Successful traders identify what type of trader they are and do not try to trade a methodology that does not fit their personality.
What It Takes To Be A Successful Day Trader
A consistently successful day trader knows his or her success in not found in the box (computer software or hardware). Many times traders look for the answers in technology and it is not there. They blame technology for failure so their answer is to buy more technology. The answer is understanding and controlling your own emotion and taking responsibility for your own actions and making decisions based on analysis. If you are wrong, you do not personalize the loss, you just say "next." Successful traders know that losing is part of the cost of doing business. Great day traders know that you will never learn how to win until you first learn how to lose. How a trader psychologically handles loss many times determines success or failure. Success in day trading is most of all a mastery of one's self. This is not the get rich quick easy road to riches that some people think it is. It requires a commitment of time, money, and a willingness to work very hard.
Desire and working hard is not enough. You are going to need working capital. This is like any other business it takes money to make money. I suggest you have a minimum of $50,000 to $100,000. Many novice traders attempt to trade without being properly capitalized. Once you have the capital and begin to trade, never forget once you enter a trade you are no longer a day trader. Instead you are a risk manager. Trade only high probability trades and remember, every day is not a high probability trading day.
Probability of Market Going Up TommorowWant to trade successfully? Just choose the good positions and avoid the bad ones. Poor trade selection takes a heavy toll as it bleeds your confidence and wallet. You face many crossroads during each market day. Without a system of discipline for your decision-making, impulse and emotion will undermine skills as you chase the wrong stocks at the worst times.
Many short-term players view trading as a form of gambling. Without planning or discipline, they throw money at the market. The occasional big score reinforces this easy money attitude but sets them up for ultimate failure. Without defensive rules, insiders easily feed off these losers and send them off to other hobbies.
Technical Analysis teaches traders to execute positions based on numbers, time and volume. This discipline forces traders to distance themselves from reckless gambling behavior. Through detached execution and solid risk management, short-term trading finally "works".
Markets echo similar patterns over and over again. The science of trend allows you to build systematic rules to play these repeating formations and avoid the chase:
1. Forget the news, remember the chart. You're not smart enough to know how news will affect price. The chart already knows the news is coming.
2. Buy the first pullback from a new high. Sell the first pullback from a new low. There's always a crowd that missed the first boat. [This rule will save you a lot of money - very rare for new highs/lows not to be tested; don't buy at the peak or sell at the floor.]
3. Buy at support, sell at resistance. Everyone sees the same thing and they're all just waiting to jump in the pool.
4. Short rallies not selloffs. When markets drop, shorts finally turn a profit and get ready to cover. [This is key in Penny Land - short the promo just before the dump; it is too late after the dump hits.]
5. Don't buy up into a major moving average or sell down into one. See #3.
6. Don't chase momentum if you can't find the exit. Assume the market will reverse the minute you get in. If it's a long way to the door, you're in big trouble.
7. Exhaustion gaps get filled. Breakaway and continuation gaps don't. The old traders' wisdom is a lie. Trade in the direction of gap support whenever you can. [Also don't sell a gap that does not fill too early; use a trailing stop instead.]
8. Trends test the point of last support/resistance. Enter here even if it hurts. [Some of these are reptative aren't they - probably only need 10 "golden rules".]
9. Trade with the TICK not against it. Don't be a hero. Go with the money flow. [i.e., the trend is your friend.]
10. If you have to look, it isn't there. Forget your college degree and trust your instincts. [My graduate degree never helped me learn to trade the OTC. As i recall, my corporate finance professors always did crap in the markets by their own accounts.]
11. Sell the second high, buy the second low. After sharp pullsbacks, the first test of any high or low always runs into resistance. Look for the break on the third or fourth try.
12. The trend is your friend in the last hour. As volume cranks up at 3:00pm don't expect anyone to change the channel. [I also love morning power hour; I have always said I only need 2 hours of trading to make money, and they are at open and close - this is especially true on the OTC..]
13. Avoid the open. They see YOU coming sucker
14. 1-2-3-Drop-Up. Look for downtrends to reverse after a top, two lower highs and a double bottom.
15. Bulls live above the 200 day, bears live below. Sellers eat up rallies below this key moving average line and buyers to come to the rescue above it.
16. Price has memory. What did price do the last time it hit a certain level? Chances are it will do it again.
17. Big volume kills moves. Climax blow-offs take both buyers and sellers out of the market and lead to sideways action. [One of the reasons I focus on the power hours.]
18. Trends never turn on a dime. Reversals build slowly. The first sharp dip always finds buyers and the first sharp rise always finds sellers.
19. Bottoms take longer to form than tops. Greed acts more quickly than fear and causes stocks to drop from their own weight.
20. Beat the crowd in and out the door. You have to take their money before they take yours, period. [i.e. don't be greedy, but be early.]
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