Thursday, March 30, 2006

Here is the FOC 5 day chart.

Interest rates go up, equities go down, then rebound next day, then continue on current trend the third day, which is down.

free stock charts from ADVFN.COM

Well I was correct, but I SUCK!!!!!!!!!!


I hate myself. I don't know why I'm living. I'm addicted to a game that I lose at. My analysis was correct. Today, I watched the market selloff. Then for some GOD DAM REASON,,,,no,no, excuse me,,,,no fucking reason at all,,I decide to buy, thinking it would retrace to the 38% fib. It didn't it stayed at 23% for 30-40min while I watched the ticks lose strength and the overall prevailing trend take over. I could have exited for 1-2pts, but I was WISHING for a breakout to the upside. I should have never gotten into that trade to begin with, for gods sake, I bought while the ticks were in the 400-500range, I didn't buy the pullback, I chased the trade. I was given 3 chances to exit to break even, but I failed, I lost 12pts. I SUCK. WHY do I sit and watch the major moves, and enter when things get choppy? I WILL NOT TRADE UNTIL I'M CONSISTENLTY PROFITABLE IN THE SIMULATOR. THAT IS GOAL #1!!!
Goal #2. Do analysis night before, looking at daily and weekly. Check for pending news on alpha1.
Goal #3-You suck,,repeat, you suck,,you suck,,you suck,,you suck. YOU SUCK.
Goal #4-U suck.
Goal #5- take the profit
Goal #6-why and the fuck do you put in such a huge stop loss and only take 2-5pt profit,why,,,why? Answer: You suck

Tuesday, March 28, 2006

I'm a coward

The FOC annoucement came with an increase in interest as expected, and I watched the market drop 100pts on the Dow. I made some coin on the simulator, but I was expecting the initial direction of the market to go up, followed by a selloff, just like last time. I tell you what, that Bob Pisani can never guess the market, he was saying the market may turnaround in an hour after the annoucement,,,,tell me,,why? The market closed near its low, just like last time. Interest rate hikes are B-A-D, not good. Also, if you looked at the chart we are at a right shoulder, perfect timing for bad news and a selloff. I have a feeling that the market may want to bounce tommorow, but there is still a right shoulder in place that could come down for the next 2-3 days. I'm hesistant to be long tommorow for the rebound. Maybe thursday I can go short if we rebound on wednesday, just so we can complete the shoulder. Is it a coincidence that the market was near its high the last couple of FOC annoucements and we got a huge sellf off ending in the red?

Sunday, March 26, 2006

Trade setup for NQ

I'm using MAC-Daddy and MA crossovers to help guide me in the right direction, but I will be entering trades off of price channel breaks, making me a breakout range trader. This is the only strategy that I see has the highest probability of capturing the move before its over because MACD and MA crossovers only tell you what way the index has turned after the fact, in which case the majority of the move has already occured, unless your lucky and its a volatile day in which the trend continues in one direction without getting choppy.Here is an example chart with entry points, the exit points are done with trailing stops. The NQ trades in 0.50 increments, once I get 1 pt up, I'll set the stop below the current price by 0.5, assuring a 0.5 profit. My goal is 1-2 pts per price channel break, and this is attainable, beacuse most price channel breaks move at 0.5-4 pts per move. With price channel breaks I'm only catching 25-75% of the move, but it gets you in quicker then any other indicator will. Most indicators get you in when the price has already moved 75-90%. For less volatile trading a 2pt stop loss can be used. For volatile trading, like at the open or when bond markets are closing a 3pm EST, a 5pt stop loss may want to be used when the trade is placed.
free stock charts from ADVFN.COM

Sunday, March 19, 2006

FOC day is coming

I may trade the FOC day on the YM. I'm hoping for a good trend to occur after the annoucement like last time. Just remember the reversal the next day. Also, I could trade DIA options for an even better profit if done right.


If you trade futures, you may save money by leasing a seat on the CBOT or CME, by leasing a seat like IDEM for around $100 a month. About 1/5th of my losses are made up of commissions from IB. IB is not the best broker for futures, good for retail stocks, but not the best for executions and commissions on futures. J trader is good for futures, I like their grey box trading or "depth trading" platform, its similiar to IB's book-trader. I think knowing an equities avg. daily range is essential and also knowing the likelyhood of it closing near it's low for the day, and also the likely hood of its trend carrying on to the next days trading at the open.

Tommorow, buy GNTA and GNBT at open, sell for 0.03 profit or swing it for 0.10-0.20 profit. I like the swing idea better, to save on commissions.

Friday, March 17, 2006

LifePost's thoughts

I work, but on my free time I sit in front of a computer and do technical analysis and research on the stock market. My goal is to make money. The goal of making money is for obvious reasons, but at this point in my journey it's more about being right and proving that I'm right with profits. What will I do with the money? I have no clue. I don't know what the point of life is, but I do know that if I'm going to stick around to try find out, I need money. I don't really want anything materialistic out of life, I just want to be dam good at something and enjoy what I do.
OK,,,,Back to the stock market,,,I'm investigating opening a Roth IRA to trade out of for tax purposes and of course I don't plan on drawing out of this account, its for retirement. Also, I've decided to switch back to trading stocks and options until I've become suberbly profitable trading futures, or until I develop my trading system with tradestation. I must say, IB sure kicks ass even though they have shitty charts. What it all boils down to is price, tape reading, knowing support and resistance, trends, and news.

I've found a statistically high probability trade that is a hell of a lot easier then ETF arb. Look for stocks with quarterly or one time dividends, trade them by shorting them at the open on ex-dividend day and place your limit cover at an easily hit target. Tell me, why in the hell the stock would not go down at all after the open on ex-div.? It always does, people are selling and taking the dividend profit, of course, the majority of the people doing this probably could have waited a day or week later to sell for a better profit, but they want to get in and out of the position with the least amount of exposure to risk. What I would do is buy 3-14 days before ex-div. and sell 1-2 days before, because there is a high probability on those big dividend payers that the stock will be going up before ex-div day. If I'm going to day trade, I better off go long on stocks nearing there ex-div days. Also you may notice 2 days before ex-div date, that the price declines, this is from guys like me that bought earlier and are cashing out, and also from people who want to stay away from the dividend. The best stocks this strategy works on are low volatile, highly liquid stocks with avg. volume over 1 mil and market caps above 1 bil. Also you should take note the current direction of the stock's trend and its corresponding index trend. There's one thing you must be careful of, and that is not shorting on ex-div day if the opening price is greatly lower than the adjusted closing price the day before. Example:Stock XYZ closes at an adjusted price of 15.00(16.00 stock minus a 1.00 dividend) and the next day (ex-div day)the stock opens at 14.50(0.50 below the adjusted price of 15.00), in this case, I probably would stay out of the trade. Here is a real example:
Date Open High Low Close Volume Adj Close*
13-Feb-06 77.5 80 76.61 77.45 1,931,200 77.45
13-Feb-06 $ 2.75 Dividend
10-Feb-06 84.3 85.4 81.53 83.08 2,322,700 80.33

Careful shorting on Ex-div. here, the opening price is way below the closing adjusted price the day before.Although the trade still works, it has a higher probability of lower returns.

Here are good examples where buying 1-2 weeks out and shorting on market open on EX-div day works.
Examples: Buy 14 days out.
Date Open High Low Close Volume
23-Nov-04 26.52 26.7 26.4 26.53 70,459,696
22-Nov-04 26.75 26.82 26.1 26.65 92,410,800
19-Nov-04 27.03 27.07 26.84 26.86 85,808,600
18-Nov-04 27.13 27.17 27 27.07 63,249,900
17-Nov-04 27.25 27.35 27.06 27.17 58,830,700
16-Nov-04 27.33 27.34 27.05 27.12 64,522,600
15-Nov-04 27.34 27.5 27.2 27.39 104,468,000(short,max $0.14 P)
15-Nov-04 $ 3.08 Dividend
12-Nov-04 30.16 30.2 29.8 29.97 162,268,992
11-Nov-04 29.89 30.08 29.82 29.98 87,358,896(sell $29.98=$2.25 P)
10-Nov-04 29.92 30 29.69 29.73 84,097,696
9-Nov-04 29.43 29.89 29.35 29.77 100,401,000
8-Nov-04 29.18 29.48 29.13 29.28 112,802,096
5-Nov-04 29.21 29.36 29.03 29.31 95,337,696
4-Nov-04 28.38 29 28.38 29 87,867,696
3-Nov-04 28.65 28.65 28.31 28.47 79,666,704
2-Nov-04 28.26 28.47 28.03 28.24 89,417,104
1-Nov-04 28.16 28.28 27.96 28.08 72,930,896
29-Oct-04 28.12 28.15 27.8 27.97 80,010,096
28-Oct-04 28.11 28.54 27.9 28.01 63,059,600
27-Oct-04 27.86 28.35 27.58 28.15 72,392,600
26-Oct-04 27.71 27.9 27.63 27.9 76,966,600
25-Oct-04 27.67 27.77 27.55 27.63 61,529,500(buy $27.63)

AMTD-Buy 16 day before Ex-div.
Date Open High Low Close Volume
27-Jan-06 20.25 20.49 19.93 20.17 5,646,600
26-Jan-06 19.75 20.25 19.25 20 10,016,700
25-Jan-06 19.74 19.8 18.86 19.38 32,390,100 (short, max 0.88 P)
25-Jan-06 $ 6.00 Dividend
24-Jan-06 26.19 26.37 26.06 26.1 8,382,300 (sell 26,=$2 P)
23-Jan-06 25.81 26.01 25.7 25.97 7,782,500
20-Jan-06 25.61 25.9 25.09 25.51 6,648,600
19-Jan-06 25.78 25.9 25.35 25.65 4,483,600
18-Jan-06 25.49 25.53 25.05 25.33 4,992,800
17-Jan-06 25.97 26 25.5 25.62 4,537,200
13-Jan-06 26.2 26.21 25.8 25.93 8,026,100
12-Jan-06 26.1 26.25 25.86 26.04 11,929,800
11-Jan-06 25.5 25.93 25.5 25.7 9,022,500
10-Jan-06 25.58 25.58 25.16 25.21 5,867,900
9-Jan-06 25.25 25.71 25.23 25.52 5,416,400
6-Jan-06 25.35 25.35 24.95 25.01 9,867,100
5-Jan-06 25.22 25.45 24.76 25.11 7,238,700
4-Jan-06 24.86 25.26 24.75 25.06 9,608,300
3-Jan-06 24.15 24.64 23.86 24.55 5,510,000
30-Dec-05 23.98 24.15 23.58 24 2,932,900 (buy $24)

NAD- Buy 13 days out
Date Open High Low Close Volume
16-Feb-06 33.05 33.34 32.88 33.25 170,600
15-Feb-06 33.04 33.27 32.55 32.95 163,000
14-Feb-06 33.35 33.35 32 32.9 346,500 (Short max 1.35P)
14-Feb-06 $ 1.88 Dividend
13-Feb-06 35.71 35.99 34.7 34.76 451,600
10-Feb-06 36 36 34.26 35.68 596,100 (sell 35.68=$4.22 P)
9-Feb-06 36.35 36.92 36.05 36.29 446,600
8-Feb-06 36.5 36.5 35.6 35.98 383,000
7-Feb-06 35.85 36.81 35.2 35.6 1,211,400
6-Feb-06 32.95 34.34 32.82 34.34 416,800
3-Feb-06 31.8 32.5 31.66 32.49 157,800
2-Feb-06 32.2 32.2 31.55 31.65 219,500
1-Feb-06 32.28 32.33 31.75 32 137,900
31-Jan-06 32.15 32.5 31.87 32.06 179,100
30-Jan-06 31.68 32.36 31.55 32.05 276,300
27-Jan-06 31.38 31.8 31.34 31.75 119,000
26-Jan-06 31.66 31.94 31.04 31.38 181,800
25-Jan-06 31.95 31.95 31.01 31.56 263,500 (buy 31.56)

AIC- Buy 7 days out on first day up after down trend.
Date Open High Low Close Volume
3-Jan-06 6.46 6.53 6.26 6.42 513,400
30-Dec-05 6.48 6.48 6.35 6.46 457,700
29-Dec-05 6.55 6.62 6.5 6.51 549,200
28-Dec-05 6.42 6.56 6.33 6.56 552,000 (short max $0.09 P)
28-Dec-05 $ 0.34 Dividend
27-Dec-05 6.7 6.85 6.57 6.75 287,000 (sell 6.75= 0.94P)
23-Dec-05 6.49 6.73 6.49 6.69 168,000
22-Dec-05 6.36 6.48 6.3 6.45 159,200
21-Dec-05 6.25 6.34 6.23 6.31 393,300
20-Dec-05 6.1 6.23 6.07 6.23 377,600
19-Dec-05 6.13 6.34 6.1 6.12 305,100
16-Dec-05 5.86 6.1 5.85 6.1 740,400
15-Dec-05 5.67 5.82 5.6 5.81 1,460,700 (buy 5.81)
14-Dec-05 5.71 5.76 5.58 5.65 881,400
13-Dec-05 5.74 5.87 5.67 5.69 467,200
12-Dec-05 5.95 5.95 5.75 5.75 329,400
9-Dec-05 5.92 6 5.85 5.88 237,400
8-Dec-05 6.01 6.03 5.88 5.94 222,200
7-Dec-05 5.99 6.03 5.88 5.94 240,400

Thursday, March 16, 2006

Who are you trading against?

Is it man or machine?
Just a reminder, there are a ton of automated systems, particulary when a MA crossover occurs, or with some of the advanced systems, when a Fib level is broken or the ticks or trin hit extremes, or there is a disrepency in the fair value of either the stocks in the index or the future contract.

Ways to make money in the market.

Other choices are actively watching stocks that are very volatile with 5-10% swings intraday on average. I can buy any point and have a 50% chance of 1% for the day. Buy low sell high. Screw arbitrage and looking for 1-5 second discrepancy opportunities for a measley profit, that's a full time job, plus I need an extra 500k an advanced software. You can write out the money puts if you got deep pockets. You can pump small caps. Just don't go buying futures options.

So here's your options to making money in the market:
1.Buy an ETF that tracks a major index.(small cap or Russell 2000 is a good choice)
2.Buy a stock with a high dividend yeild and hold it.(PVX is a good oil company with 11% yeild)
3.Learn how to trade futures and scalp 5-10pts at a time looking for 50pts a day.(on YM)
4.Daytrade/Swing trade small cap volatile stocks.(like biotechs: NVAX,AVII,GNTA,INSM)
5.Day trade high priced volatile stocks with tight spreads.(GOOG is awesome for day trading, but make sure you set your stops, if news pops out, you can be screwed real fast).
6.Use option calendar spreads and make a fair amount each month selling puts and calls that are covered.

Market Internals

If you don't use market internals, you may suffer internal damage to your account. If you trade the index futures or their ETF's, you must master market internals to know the direction of the market and to never trade against it. Next step is tape reading. Next step is knowing where the pivot points or points of support and resistance are and looking for trend line breaks. Then you must incorporate statistical knowledge into your trading by knowing the avg daily range in price. Also you must look at morning gaps that have a high likely hood of being filled. You need to place key pivot points from the previous days trading and also set fib retracements if it looks like you've reached a reversal after a good run.

Do you know what direction to trade when the Trin is 0.5 or 2.0?
Do you know what direction to trade when the Tick just gave a reading of +1000?
Do you know what direction to trade when the put call ratio is 0.6 or 1.0?
Do you know what direction to trade when the up volume is 2x greater than down volume?

Thursday, March 09, 2006

Trade automation

I've been setting up my ideal trading system and it consists of 1 minute time charts on a 2-4 hr chart with signal for entry and exits based off of moving average crossovers(EMA 7 and T-3 14,0.5) Also I've put in fisher transform, RSI, and MACD for extra confirmation on the trades.

The best vehicles to drive right now appear to be SOXX options and NDX, which move more than YM and ES, the only downside is the liquidity.

Saturday, March 04, 2006

Watching for pullback on DJI to 10900 in next week

Use Time and sales, pivots, pit noise, Moving averages, MACD, trend lines and discipline.

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