How To Trade: Full Stop

[The Expert]

I will digress from trading related matters for now, as I think it is warranted at this moment in time.

When I call myself The Expert, I am not being big headed or belittling anyone. I too, once upon a time, was a stupid and thick idiot that listen to so called "Experts", whom, I now know were nothing but assholes that could not tell one end of a chart from another.

To shorten this post, I will make a statement that sums it all up.

Any trader that uses standard TA on charts is not a real trader, and, has not yet discovered the riddle of the charts. It took me a long time, and a lot of money, to crack the riddle, and to make it worse, I was helped out along the way by the few real "Experts" that knew exactly what they were talking about, but yes, you guessed it right, I thought they were idiots who knew nothing, and that everyone else were the real "Experts".

All I will say now is, I am glad that I remembered what they showed me, for when the pieces of the puzzle fall into place, it is as clear as day, and like I keep saying, it is as simple as ABC.

 

[DionysusToast]

Cant say ive been keeping an eye on this thread.
He is just posting the ranges of various symbols in bar chart form, no?

Dont know how DT was able to work out what stock it was from. Maybe there is a feature in tradestation that lets you scan things like that? I dont know. weird.
Gotta laugh at being asked to explain graphs without any labels tho! haha.

Well - it was a stock we have already been looking at - so that narrowed it down. For some reason I didn't see it earlier in the day (I'm in a semi-coma due to working all day. day trading the evenings & having a 3 month old kid interrupting my sleep) when I looked at the very same stock.

Then - it was something I'd mentioned in my reply to Charlton of what I expected it to be. I didn't expect it to be some convoluted formula and it isn't. It is actually quite obvious, I only looked for 2 things and it was one of the 2.

 

[The Expert]

BDX - range 1.28, open to close .92, 'mystery value', .03
DD - range .56, open to close .03, 'mystery value' .27

And what about HPQ?

A "mystery value", I like the sound of that, as it implies that one has to do some thinking, and who knows, maybe the universe will come alive and some Pies will start falling out of the Sky.

DT, you are on the right track, and there is one thing that will blow you away when you crack it, and what is more, when you see it you will not want to tell anyone, as I was never told it, but I did see it, eventually, and likewise, I will never tell anyone, but like me, that does not mean that anyone else will never see it, for beauty is in the eye of the beholder.

Good work, you will like the picture when I post it, I will do as soon as I get a chance, as I have other important things to do as well, besides helping out those who want to help themselves.

 

[DionysusToast]

Aaah - HPQ - range .98, open to close .75 and 'mystery value' -.08

 

[The Expert]

Aaah - HPQ - range .98, open to close .75 and 'mystery value' about -.08

What are the %'s in relation to the 1st and 2nd bars?

 

[Spcboe]

Hi there, TE. Ive been here since the beginning. Continue to move forward with this thread.

 

[The Expert]

Hi there, TE. Ive been here since the beginning. Continue to move forward with this thread.

Ah Spcboe, am I doing OK, or should I change the approach?

 

[The Expert]

Now DT, it should take you no more than 10 minutes to work this one out, but it may take others a week, or more.

 

[The Expert]

And last, but not least, I will give you 5 minutes for this one and will check to see if you have them up tomorrow.

 

[DionysusToast]

First :

Second :

 

[tss42]

Now DT, it should take you no more than 10 minutes to work this one out, but it may take others a week, or more.

Not sure if the clue was intended, but the blue bars seem to be high - low on a weekly chart.

The red bars have a wavy nature, likely to be something to do with the price swings, but I cannot work out for the life of me what they are.

Edit: Almost all the red bar values are like close - open, but the 2nd and 3rd bars are not matching with what I have.

Weird!

 

[tss42]

And last, but not least, I will give you 5 minutes for this one and will check to see if you have them up tomorrow.

And in this one the blue bars seem to be high - low on a monthly chart, but again I cannot work out the red bars.

 

[Charlton]

Aaah - HPQ - range .98, open to close .75 and 'mystery value' -.08

DT

That was a very useful picture. I too can now work out what the "mystery value" represents.

As an aid to others, all the information you need to produce these charts is available from

http://uk.finance.yahoo.com/q/hp?s=HPQ&b=2&a=00&c=2010&e=25&d=01&f=2010&g=d

In other words as long as you know the symbol you can produce these charts with no specialised trading software whatsoever.

Charlton

 

[DionysusToast]

What are the %'s in relation to the 1st and 2nd bars?

There's a number of ways to look at this as we do in fact have 3 sets of numbers.

We have total range, then open - close as well as our mystery number. Any pair could expressed with one as a percentage of the other.

So - if I look at close - open and our mystery number, I see nothing conclusive except that a little over half the time, the open moves in the same direction as the mystery number and carries on. In 75% of the cases, the distance from open to close is greater than mystery number. I wouldn't draw any conclusions from pure math data anyway.

It is possible that on certain dates, an event created a situation where the mystery number gave us some indication of the days action.

hmmm.... :?:

I am perhaps barking up the wrong tree...

 

[timsk]

I must say, I am a bit disappointed that there has not been more questions and postings, for I have given enough information for any level headed person to construct the basis of a solid trading approach, that actually works for daytrading US stocks, but very few are grasping what it is all about. So be it, as I am only interested in helping those who help themselves, and others.

Actually TE, if you read through the thread, you'll see there have been lots of questions. For the most part, you have elected either to ignore them or to reply with a non-sequitur, which is a different matter entirely. The thread is a week old and 20 or pages in length and the entire thing has been summed up in a few paragraphs by Charlton, which can be further paraphrased thus: to daytrade US stocks effectively one needs to find candidates with good liquidity and volatility. (BTippen and Trader333's comments on volatility duly noted.) I'll try asking another question: is this summary accurate and, if not, what golden nuggets have been revealed that I've failed to note?
Tim.

 

[Trader333]

Originally Posted by The Expert
Forget about C, unless you are part of the deep discount gang.

OK I will and I was only posting the range as you had aksed for it to be posted for all stocks discussed so far.

I do not agree with recent comments about very low commissions and trying to capture just a few cents, to me that is unprofessional and a waste of valuable time.

Well it does work and can give good profits but I take your point with regard to how you may trade that it is not relevant.

As well as that, this mentality that you have to have an account set up with a broker, and funds in excess of $25K to daytrade effectively, is another load of rubbish. Depending on where you have your trading account, you can still get 4:1 leverage, and more even, although the commissions will be higher, but you can not have the best of both worlds, all of the time.

I agree


Paul

 

[tss42]

BDX - range 1.28, open to close .92, 'mystery value', .03
DD - range .56, open to close .03, 'mystery value' .27

The mystery value being the overnight gap.

 

[tss42]

And what about HPQ?

A "mystery value", I like the sound of that, as it implies that one has to do some thinking, and who knows, maybe the universe will come alive and some Pies will start falling out of the Sky.

DT, you are on the right track, and there is one thing that will blow you away when you crack it, and what is more, when you see it you will not want to tell anyone, as I was never told it, but I did see it, eventually, and likewise, I will never tell anyone, but like me, that does not mean that anyone else will never see it, for beauty is in the eye of the beholder.

Good work, you will like the picture when I post it, I will do as soon as I get a chance, as I have other important things to do as well, besides helping out those who want to help themselves.

So, I may be totally off the mark, but we seem to be interested in stocks that, apart from having a healthy range, also travel little overnight.

Or rather, we are interested in these stocks when they travel little overnight?

Hot or cold, The Expert?

 

[tss42]

There's a number of ways to look at this as we do in fact have 3 sets of numbers.

We have total range, then open - close as well as our mystery number. Any pair could expressed with one as a percentage of the other.

So - if I look at close - open and our mystery number, I see nothing conclusive except that a little over half the time, the open moves in the same direction as the mystery number and carries on. In 75% of the cases, the distance from open to close is greater than mystery number. I wouldn't draw any conclusions from pure math data anyway.

It is possible that on certain dates, an event created a situation where the mystery number gave us some indication of the days action.

hmmm.... :?:

I am perhaps barking up the wrong tree...

So in short,
1. the open moves in the same direction of the overnight gap.
2. The distance of open to close tends to be greater than the overnight gap.

We also seem to be chosing stocks with really small gaps. TE earlier posted a table of economic events for a number of stocks, so presumably those events trigger a situation where the overnight gap is small and what you said above tends to hold.

But where do the weekly and monthly charts (assuming that's what they were in the BDX chart) come into all this?

Edit: Wait, I am sort of thinking, looking at various charts, and what you said, if you open a position at the open of the market, biased according to the gap on the day earning news comes out, place a stop at the other end of previous day's range (i.e. if the stock gaps down, you open a short trade and place stop at previous day's high), and cloe the trade at the close of day, then you have the basis of a decent system.

Edit 2: Also, for long trades we only get involved in stocks that have beaten expectations and have a low short interest ratio.

 

[The Expert]

markets are dynamic and information changes.. I dont think your horizontal line "strategy" will work..You have to take into account the new information that has come out that caused the market to hit your level..you need to look at it in relation to other markets to put it into perspective...if by "manage the trade" you mean position size management then I agree that this is 1 of the keys... there are no shortcuts in trading and you really do have to know your sh*t .. 1 horizontal line is a bit of a weak plan.

It took a while for to show all what he really knows about trading, but I knew from his very first post.

D911, you are of course correct. If successful trading was as simple as trading every S&R line that is broken, and limiting your loss on every trade you place, then everyone who trades would be millionaires, which of course we know, is not the case.

Amateurs think like this, and they might make a buck here and there, maybe enough to pay for the holiday, or even the new car, but make a substantial amount of money each and every year, well, I think not.

As you rightly say, you must know your sh*t, or else you will never become an expert at trading the financial markets.