Eagles Nest

[Eagles soar]

Greetings traders, my name is George and I'm a swing trader here in the US. I would like to start a thread where I can post some ideas and look forward to your feed back. I do not use any indicators other than the Average true range. From this I also position the size of my shares and risk. I normally scale out once I get a 1R and then trail the rest. I'll often have some fairly large wiggle room from entry to stop and will adjust stops based off the average true range. Money management is most important to me and I never risk more then 1-2% of capital on any one trade.

The cool thing about my system is the risk is the same weather I have a 10% stop in place or a 5%. I do have a blog and if others are interested in the position sizing method I use I'll post the blog address later. If this is allowed in this forum.

As of right now I'm in cash as I closed out my last swing today. I feel the Indices are slightly overbot and will await a pullback. I use a bottoms up approach to the markets and this is first my scans, the sector, and S&P500. I like for all three to be in agreement.

 

[Eagles soar]

Eglt

This one hit my scan tonight. What I like about this stock is you have a stock that has currently poped out of a range and is presently in a first pull back mode. What I don't like is this stock is a little thin.

 

[Eagles soar]

Here is the plan on EGTL. Trigger long 19.59 with stop at 17.47. Scale out 1/2 position at 21.71 or 1R Use 1% model. I got stock, sector in line. Only problem is the S&P so we will more likely than not let it go.

 

[damianoakley]

Hi George,

I too trade exclusively in U.S. Stocks, although I am based in the UK.

I have to agree with you that EGLT seems like an excellent stock that I would expect to hit $28 over the next 6 months (approx. 40% gain).

The only reason I'm not trading this stock at the moment is because I am fully margined with other pyramided positions in other stocks.

Actually, a stock which has done quite well for me recently is Smith & Wesson (SWHC). I bought it a week ago and it's gained 14% in that week.

Good Luck!


Damian

 

[andycan]

maybe im wrong on this one but looking at EGLT looks to me like it could make a downmove before the upmove i dont trade shares but i do trade US index and commodities,

 

[damianoakley]

I don't disagree with you.

Although fundamentally and technically this stock looks good to me, I personally wouldn't buy it until I saw the price making new high ground on reasonable volume.



Thanks


Damian

 

[andycan]

absolutely!
good luck on it i will have a look at it EOD just out of curiosity

 

[Eagles soar]

Schw

SCHW is setting up.. I how this stock is trying to leave the base and is in a first pull back.

 

[damianoakley]

If I was looking to invest in this sector (ie - Investment Services/Financial), I would personally favour TROW.

This company has strong fundamentals and a 5 year share price up-trend.

Just my opinion though!


Thanks


Damian

 

[andycan]

Damien

EGLT has me curious the chart i have does not give me long term data but looking on the short term. the daily gives me a target to the 17.5 area and the 60min a little lower i will be a buyer around that area
never traded shares so may have a go here

 

[damianoakley]

I am more of a position trader, so wouldn't look at a time-frame lower than the daily.

For me, this stock has excellent fundamentals, but I would not be a buyer until it hit a new high near $21 on convincing volume. From there, I could see it going to $28.

I can see today however that the price has continued downward, so I won't expect a break-out to a new high too soon.

Looks like this is one for my watchlist for now.

Good luck with your trade!



Damian

 

[Eagles soar]

Well nniether triggered on the long side (EGLT SCHW). I did not enter anything today as I said in my first post the market looked a little extended. I'll keep these 2 stocks on watch for about one more day and then drop then off the screen.

Here is an older chart from I think a few days ago and this has been what I'm looking at in the S&P 500. I also like to use the TRIN as a short term indicator..

 

[Eagles soar]

Scan return (groups)

I’ve got 39 stocks out of 1289 tonight. Here are the sub-sectors showing the most returns.
Residential Construction 6 stocks
Textile-Apparel Clothing 4 stocks
Investment Brokerage-National 3 stocks
Major Airlines 2 stocks
Specialty Eateries 2 stocks
We will focus on some of these groups next week and she what happens. I’m surprised by the small amount of returns and of pullbacks I’ve received tonight.

 

[Eagles soar]

Here is a link to my blog that explains ATR (Average true range) and position sizing/stops
http://geoshorttermtrading.blogspot.com/2005/12/atr-stop-position-size.html

 

[damianoakley]

Hi George,

May I say that your risk control and position-sizing method are excellent.

This method of position-sizing is exactly what I myself use and teach.

It's interesting because most people who trade stocks do not employ sophisticated position sizing techniques in this way - they like to simply look at a stock's gain and say: "the stock increased by 30%", when in fact they should be looking at their gain relative to the amount that has been risked, and the amount they risk should be directly proportional to the total trading capital available.

Many people I've met who trade stocks tend to just divide their capital up into 10 equal parts and then buy 10 different stocks. This in my opinion is far too simplistic and does not equalise losses nor maximise on potential profits

Good luck with your trading!


Damian

 

[Eagles soar]

Damian, you are so right. Many take the get rich approach to the markets and crash and burn. Often the markets reward bad habits and makes one think they have the holly grail. Position sizing is very important and many do not understand the concept of this area. Like you said they buy in equal units. I like the ATR method and the reason is that it tries to keep you out of the daily noise, not always works out. As you can see if you play around with different charts how your percent risked on the trade differs but the amount risked per trade remains the same.

Thank all that have taken time to reply to this thread!!

 

[andycan]

I am more of a position trader, so wouldn't look at a time-frame lower than the daily.

For me, this stock has excellent fundamentals, but I would not be a buyer until it hit a new high near $21 on convincing volume. From there, I could see it going to $28.

I can see today however that the price has continued downward, so I won't expect a break-out to a new high too soon.

Looks like this is one for my watchlist for now.

Good luck with your trade!



Damian

Damien

thats what makes trading so facinating to me a buy in that low 17 area would make for a good swing trade, i dont look at fundamentals but im aware of the macro economic situations at least one has to be if one trades US bonds and most of the commodities
good luck on your approach its interesting to see different styles
BTW would you not look at intraday just to fine tune your entry??

Andy

 

[damianoakley]

Hi Andy,

Like you say, it's interesting to see people's differing trading styles - after all, it's those differing opinions that makes a market in the first place.

For the type of trading that I do, I don't think I would need to look at intraday time-frames to fine-tune my entry. I like to keep my trading simple!

Out of curiousity though, what sort of fine-tuning are you referring to?


Thanks

Damian

 

[andycan]

[Out of curiousity though, what sort of fine-tuning are you referring to?

Hi Damien

Out of curiousity though, what sort of fine-tuning are you referring to?

Hi Damien

Bit of a tough question to answer because i guess it depends on how you view the markets for example if i remember rightly you look at fundamentals but then look for an entry kind of like a break out system of the chart ie higher price etc

I for example look at the market technically but within that i judge the charts by different methodology, for example i look at the market in different time frames each time frames tells me a different story then within that i look at structure how the market is impulsing,volume,(OI for futures) geometry, timing, wave structure from there i then have an idea where the market wants to go and where it could go but to do this i need to see different times frames some times the intra-day tells you where the markets is temporarily going even though the daily points to the opposite direction

regards

Andy

 

[Eagles soar]

I’ve got 39 stocks out of 1289 tonight. Here are the sub-sectors showing the most returns.
Residential Construction 6 stocks
Textile-Apparel Clothing 4 stocks
Investment Brokerage-National 3 stocks
Major Airlines 2 stocks
Specialty Eateries 2 stocks
We will focus on some of these groups next week and she what happens. I’m surprised by the small amount of returns and of pullbacks I’ve received tonight.

I forgot to post my punch out list

Alliance Data
American Eagle Outfitter
AFC Enterprises Inc
Agrium Inc
Black & Decker Corp
Bebe Stores Inc
Immucor Inc
Beazer Homes Usa
Continental Airlines B
Circuit Cty Strs Inc
Coach Inc
Columbia Sportswear Co
Citrix Systems Inc
E Trade Financial Corp
Expeditors International of Washington Inc
Corning Inc
Guitar Center Inc
World Fuel Service Corp
Kendle Internat Inc
The Knot Inc
M.D.C Holdings Inc
Application Software
Telecom Services-Domestic
Internet Service Providers
M/i Homes Inc
Morgan Stanley
Nvr Inc
Office Depot Inc
Pulte Homes Inc
Piper Jaffray Companies
Panera Bread Co Cl A
Polo Ralph Lauren Corp
Ryland Group Inc. The
Starbucks Corporation
Charles Schwab Corp
Standard Microsystems Cp
UAL Corp
Votorantim Celulose Papl
SPDRs Homebuilders ETF