Breakout Trading using Time and Sales

This is a discussion on Breakout Trading using Time and Sales within the Trading Journals forums, part of the Reception category; Hi Amit, Liking the thread, seems to have stopped though, hope all is ok. Can i ask you where or ...

Reply
 
LinkBack Thread Tools Search this Thread
Old Mar 6, 2010, 12:26pm   #91
Joined Jan 2005
Re: Breakout Trading using Time and Sales

Hi Amit,

Liking the thread, seems to have stopped though, hope all is ok.

Can i ask you where or how you find the stocks that you think might move? My issue is not the being in the trade and managing it, its finding the right stocks out of the thousands to choose from. What do you use as criteria for shortlisting a stock?

thanks

Coop
coopster is offline   Reply With Quote
Old Mar 6, 2010, 6:32pm   #92
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Hi Coop,

Thank you for your nice comments regarding this thread. I haven't officially stopped this thread. But I have been really busy with my final semester of my undergraduate degree, so I haven't found much time to trade lately. However, with just over a month left, I should be able to start trading full-time and will post on here occasionally as well.

The question you ask is a good one - finding the right stocks is an integral part of trading. I use a strategy similar to Richard's (a.k.a. Mr. Charts) in that I read news stories prior to market opening and select stocks which, in my opinion, are likely to present some good moves on the day. If you think about, it should make sense. Stocks with important news are more likely to present good moves on the day and are also likely to have "one-sided" traders (a majority of them may be buying or selling). This adds further to the probability of a successful trading day, which is ultimately what I am trying to accomplish.

I read news off briefing.com. They are not cheap, but for the services and convenience they provide, you can usually cover a 2-year subscription in one or two good trades.

After reading the news, I usually have about 20 - 30 stocks on my list. From that, I eliminate stocks with large spreads (spreads greater than 3 cents), stocks with price greater than $100, and sometimes, stocks that trade historically low volume. The latter only happens after the market opens because trading volume is relative to any specific day - news stories can induce large volume even if in the past, the volume is too low.

That's pretty much how I find my stocks. Keep in mind that as a trader, my job is not to form an opinion of what a stock might do during a day given the news. That, in my opinion, is trader suicide. Instead, I let the market do its thing and follow my strategies that I know work consistently.

Hope this helps,

Amit
amit1986 is offline   Reply With Quote
Old Mar 6, 2010, 6:56pm   #93
Joined Jan 2005
Re: Breakout Trading using Time and Sales

Thanks for the quick reply Amit, good luck with your studies.

I'll look up the news service you mentioned.

What is your setup if i may ask. Which broker, data feed, platform etc? Only answer if you have time between studies obviously!

thanks

Coop
coopster is offline   Reply With Quote
Old Mar 6, 2010, 7:45pm   #94
 
Mr. Charts's Avatar
Joined Sep 2001
Re: Breakout Trading using Time and Sales

Quote:
Originally Posted by amit1986 View Post
Hi Coop,

Thank you for your nice comments regarding this thread. I haven't officially stopped this thread. But I have been really busy with my final semester of my undergraduate degree, so I haven't found much time to trade lately. However, with just over a month left, I should be able to start trading full-time and will post on here occasionally as well.

The question you ask is a good one - finding the right stocks is an integral part of trading. I use a strategy similar to Richard's (a.k.a. Mr. Charts) in that I read news stories prior to market opening and select stocks which, in my opinion, are likely to present some good moves on the day. If you think about, it should make sense. Stocks with important news are more likely to present good moves on the day and are also likely to have "one-sided" traders (a majority of them may be buying or selling). This adds further to the probability of a successful trading day, which is ultimately what I am trying to accomplish.

I read news off briefing.com. They are not cheap, but for the services and convenience they provide, you can usually cover a 2-year subscription in one or two good trades.

After reading the news, I usually have about 20 - 30 stocks on my list. From that, I eliminate stocks with large spreads (spreads greater than 3 cents), stocks with price greater than $100, and sometimes, stocks that trade historically low volume. The latter only happens after the market opens because trading volume is relative to any specific day - news stories can induce large volume even if in the past, the volume is too low.

That's pretty much how I find my stocks. Keep in mind that as a trader, my job is not to form an opinion of what a stock might do during a day given the news. That, in my opinion, is trader suicide. Instead, I let the market do its thing and follow my strategies that I know work consistently.

Hope this helps,

Amit
Cracking good post, Amit
Good luck with the exams !
Best wishes,
Richard
__________________
Mr. Charts
Full time US Share Trader
Follow me on Twitter twitter.com/MrChartsJoyson

Contributor to T2W's Trading FAQ Book
http://www.trade2win.com/books/trading-faqs

T2W interview

http://www.trade2win.com/knowledge/a...ichard-joyson/
Mr. Charts is offline Coach/Trainer   Reply With Quote
Old Mar 8, 2010, 3:18am   #95
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Hi Coop,

My primary setups include the one used in this thread and also the one used in Mr. Charts' thread. They are very similar, however, entry and exit criteria are different. If you haven't already, I'd advise you to go through Mr. Charts' thread and study his charts carefully. After that, proceed to paper-trade his system in live markets and then, after gaining confidence with the use of the method, try trading it using 100 share lots. It's an excellent system and if you stick to it as it is described in the thread, you should do well with it.

The strategy discussed in this journal is a little different, as it relies heavily on the use of Time and Sales, which is not something I can describe in this post. But to completely honest, I finding the success rate with Mr. Charts' method higher than the method used in this journal, even if you don't use level 2 as he does.

I do have a few other strategies I use, however, I'd rather not discuss them here for reasons I am sure you understand. I have designed this journal to be as much as a learning experience for myself and also for others. If I scramble it with a bunch of strategies, discussions can get sidetracked and the focus of this journal will also disappear.

I am not one to give advice on broker since there are a host of factors that influence the choice, but I find Interactive Brokers an excellent choice for my needs. Their executions are lightening fast and the link very nicely in eSignal, my trading platform. Also, their commissions are almost negligible, especially for U.S. and Canadian stocks!
eSignal also provides the intraday data for U.S. stocks, but you really do not need this if you are willing to trade off the API at Interactive Brokers. I find their API a little confusing and not user friendly, so I am willing to pay extra for the convenience eSignal provides through their excellent platform.

Not really sure what else I can advise you on, but if you have any other questions, don't hesitate to ask!

Amit


Quote:
Originally Posted by coopster View Post
Thanks for the quick reply Amit, good luck with your studies.

I'll look up the news service you mentioned.

What is your setup if i may ask. Which broker, data feed, platform etc? Only answer if you have time between studies obviously!

thanks

Coop
amit1986 is offline   Reply With Quote
Old Mar 8, 2010, 3:20am   #96
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Thanks a lot Richard!

Hope the weather in the U.K. isn't as cold as it was when I was there. Toronto is having an excellent wave of Spring weather lately!

Amit

Quote:
Originally Posted by Mr. Charts View Post
Cracking good post, Amit
Good luck with the exams !
Best wishes,
Richard
amit1986 is offline   Reply With Quote
Old Mar 8, 2010, 6:36pm   #97
 
Mr. Charts's Avatar
Joined Sep 2001
Re: Breakout Trading using Time and Sales

Quote:
Originally Posted by amit1986 View Post
Thanks a lot Richard!

Hope the weather in the U.K. isn't as cold as it was when I was there. Toronto is having an excellent wave of Spring weather lately!

Amit
Hi Amit,
It got much colder with thick snow and compressed ice. It was much more dangerous on the pavements (sidewalks) and roads than when you were here !
We couldn't walk on the grass without sinking 12 inches deep.
Very bright and sunny and crisp in Weybridge with blue skies but the trees are still bare and Spring still feels a long way off.
Take care,
Richard
__________________
Mr. Charts
Full time US Share Trader
Follow me on Twitter twitter.com/MrChartsJoyson

Contributor to T2W's Trading FAQ Book
http://www.trade2win.com/books/trading-faqs

T2W interview

http://www.trade2win.com/knowledge/a...ichard-joyson/
Mr. Charts is offline Coach/Trainer   Reply With Quote
Old Mar 9, 2010, 3:18am   #98
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Even coming from a freezing cold country such as Canada, I can honestly say that the week I spent in the U.K. was one of the coldest weeks of my life!

Hope the trading is going well,

Amit

Quote:
Originally Posted by Mr. Charts View Post
Hi Amit,
It got much colder with thick snow and compressed ice. It was much more dangerous on the pavements (sidewalks) and roads than when you were here !
We couldn't walk on the grass without sinking 12 inches deep.
Very bright and sunny and crisp in Weybridge with blue skies but the trees are still bare and Spring still feels a long way off.
Take care,
Richard
amit1986 is offline   Reply With Quote
Old Mar 12, 2010, 1:48pm   #99
Joined Jan 2005
Re: Breakout Trading using Time and Sales

Quote:
Originally Posted by amit1986 View Post
Hi Coop,

My primary setups include the one used in this thread and also the one used in Mr. Charts' thread. They are very similar, however, entry and exit criteria are different. If you haven't already, I'd advise you to go through Mr. Charts' thread and study his charts carefully. After that, proceed to paper-trade his system in live markets and then, after gaining confidence with the use of the method, try trading it using 100 share lots. It's an excellent system and if you stick to it as it is described in the thread, you should do well with it.

The strategy discussed in this journal is a little different, as it relies heavily on the use of Time and Sales, which is not something I can describe in this post. But to completely honest, I finding the success rate with Mr. Charts' method higher than the method used in this journal, even if you don't use level 2 as he does.

I do have a few other strategies I use, however, I'd rather not discuss them here for reasons I am sure you understand. I have designed this journal to be as much as a learning experience for myself and also for others. If I scramble it with a bunch of strategies, discussions can get sidetracked and the focus of this journal will also disappear.

I am not one to give advice on broker since there are a host of factors that influence the choice, but I find Interactive Brokers an excellent choice for my needs. Their executions are lightening fast and the link very nicely in eSignal, my trading platform. Also, their commissions are almost negligible, especially for U.S. and Canadian stocks!
eSignal also provides the intraday data for U.S. stocks, but you really do not need this if you are willing to trade off the API at Interactive Brokers. I find their API a little confusing and not user friendly, so I am willing to pay extra for the convenience eSignal provides through their excellent platform.

Not really sure what else I can advise you on, but if you have any other questions, don't hesitate to ask!

Amit


Thanks for the advice Amit, i will read the Mr charts thread and look at IB and e-signal.

I think the issue i have is reading the news and thinking "what the hell will that have an influence on?" OK some are obvious but what stocks would i choose when some seemingly unimportant government figure is released is at present beyond my understanding.

If you have any time, please give me an idea of the things to look out for. I am really coming unstuck with this. I think it comes from my engineering background. Everything should be black or white. Things like news and market mood i find very hazey and hard to comprehend.

Just ignore me if i am gatecrashing your thread. I'm sure with more reading, i can find my own way. PRobably most is already covered in the Mr Charts thread.

thanks anyway.

Coop.
coopster is offline   Reply With Quote
Old Mar 12, 2010, 11:34pm   #100
Joined Feb 2010
Re: Breakout Trading using Time and Sales

Quote:
Originally Posted by coopster View Post
Thanks for the advice Amit, i will read the Mr charts thread and look at IB and e-signal.

I think the issue i have is reading the news and thinking "what the hell will that have an influence on?" OK some are obvious but what stocks would i choose when some seemingly unimportant government figure is released is at present beyond my understanding.

If you have any time, please give me an idea of the things to look out for. I am really coming unstuck with this. I think it comes from my engineering background. Everything should be black or white. Things like news and market mood i find very hazey and hard to comprehend.

Just ignore me if i am gatecrashing your thread. I'm sure with more reading, i can find my own way. PRobably most is already covered in the Mr Charts thread.

thanks anyway.

Coop.
i studied stocks/news for a couple of weeks and found that all you need to do is find which stocks the news effects. how do you know that? well wait for the data to be released and scan the market for big % movers and grab a share of those moves.
FXTrend240 is offline   Reply With Quote
Old Mar 13, 2010, 8:11am   #101
Joined Jan 2005
Re: Breakout Trading using Time and Sales

sounds so simple and i guess it is really.

I need to put the time into this instead of marvelling at pretty candlestick charts and ignoring the news like so many other newbies!

Thanks for the advice.
coopster is offline   Reply With Quote
Old Mar 14, 2010, 5:32pm   #102
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Don't underestimate the impact of news. Try to keep things simple and look for things that will attract a great deal of attention. If the world's biggest investment bank, Goldman Sachs, comes out with a buy/sell recommendation on a particular stock, then there's a great chance that stock will have a lot of interest from institutional traders, hedge funds, wealthy investors, and other traders who follow Goldman Sachs' advice! Some other big banks (JP Morgan, Merrill Lynch, Wells Fargo, Morgan Stanley, etc...) also publish ratings which provide excellent ways to gather stocks. The reason why these banks get a lot of attention is because they have very smart analysts working for them who come up with these ratings. Therefore, most people try not to be on the other side of their recommendation. If Goldman Sachs tells you to buy stock XYZ, then it would be stupid to be selling the stock.

There are many other news stories on a daily basis as well. Some periods of the trading year produce more candidates than others. Like I said, keep things simple. You want to find stocks that will gather the most attention on the day. That doesn't mean you find stocks like MSFT or INTC. But, if a pharmaceutical company comes out pre-market saying that their phase III trials did not perform upto expectations, then that is going to be really bad news for the stock. In fact, for the pharmaceuticals, after watching them for a while, you'll notice that phase trials play a BIG role in their stock prices. Once again, it comes with practice and experience.

You can even subscribe to the Wall Street Journal. Headline news on the WSJ are likely to be important and since most wall street players read those news, there is a great probability the stocks mentioned in that paper are likely to garner more attention.

So start by looking at the major news of the day. You don't need briefing.com for this. Any financial news website will tell you the most important news of the day. Check out finance.yahoo.com before the market opens. If you have an iPhone or iPod Touch, download the Bloomberg application. In that app, they have a "News" section, and in that section, they provide a concise summary of 10 - 15 stocks that are most important on the day. I'm sure they would have a similar app for Blackberry enthusiasts. There is also the CNBC app. After you start getting a feel for what sort of news play an important role (and you will), you can subscribe to briefing.com to read more in-depth news and have a greater list of stocks.

Hope this helps,

Amit

Quote:
Originally Posted by coopster View Post
Thanks for the advice Amit, i will read the Mr charts thread and look at IB and e-signal.

I think the issue i have is reading the news and thinking "what the hell will that have an influence on?" OK some are obvious but what stocks would i choose when some seemingly unimportant government figure is released is at present beyond my understanding.

If you have any time, please give me an idea of the things to look out for. I am really coming unstuck with this. I think it comes from my engineering background. Everything should be black or white. Things like news and market mood i find very hazey and hard to comprehend.

Just ignore me if i am gatecrashing your thread. I'm sure with more reading, i can find my own way. PRobably most is already covered in the Mr Charts thread.

thanks anyway.

Coop.
amit1986 is offline   Reply With Quote
Old Mar 14, 2010, 5:34pm   #103
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread That's a good way of doing things, but if you wait for the market to open to scan for the big % movers, then most likely you will have missed a move by the time you find a position. In my experience, there are a lot of good moves that happen within the first half hour of the market.

For this reason, it is always good to have at least some stocks to watch prior to market opening. If nothing favorable is setting up, then you can look for others using a scanner.

Amit

Quote:
Originally Posted by FXTrend240 View Post
i studied stocks/news for a couple of weeks and found that all you need to do is find which stocks the news effects. how do you know that? well wait for the data to be released and scan the market for big % movers and grab a share of those moves.
amit1986 is offline   Reply With Quote
Old Mar 14, 2010, 5:43pm   #104
Joined Feb 2010
Re: Breakout Trading using Time and Sales

Quote:
Originally Posted by amit1986 View Post
That's a good way of doing things, but if you wait for the market to open to scan for the big % movers, then most likely you will have missed a move by the time you find a position. In my experience, there are a lot of good moves that happen within the first half hour of the market.

For this reason, it is always good to have at least some stocks to watch prior to market opening. If nothing favorable is setting up, then you can look for others using a scanner.

Amit
probably true , i wish i had time to day trade stocks, instead i'm just sticking to global macro/fundamental trigger technical entry style trading...until i can do both
FXTrend240 is offline   Reply With Quote
Old Mar 14, 2010, 5:53pm   #105
 
amit1986's Avatar
Joined May 2009
Re: Breakout Trading using Time and Sales

amit1986 started this thread Oh, cool! What do you look for in your trades?

Amit

Quote:
Originally Posted by FXTrend240 View Post
probably true , i wish i had time to day trade stocks, instead i'm just sticking to global macro/fundamental trigger technical entry style trading...until i can do both
amit1986 is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Time & Sales glebecki First Steps 22 Mar 19, 2010 2:19pm
day trading software w/ time and sales OPTIONSTHIEF Trading Software 0 Apr 29, 2008 3:54am
Trading the YM with Time and Sales lurkerlurker Indices 4 May 31, 2007 10:16am
Level II and time of sales incorporated into trading systems pkfryer Trading Software 2 Jun 8, 2004 6:24pm

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)