Stillkicking's Rules for Day Trading

CertainWay

Junior member
47 11
Hi
I can understand. A lot of traders don't feel comfy with tick charts and tend to stick to minute charts.

I use a combination of tick and time for each market since I don't like minute charts when markets are slow and dull. I've experimented with Range charts to address this issue too and might consider it at some point in time. I'm also trying a couple of other variations of candlesticks.

IF you look at certain times of the day when nothing is going on(for example during lunch in NYC traders go for lunch and markets tend to contract; same thing say on Friday afternoons; part of Mondays; time before a major announcement or economic report; parts of summer when people take vacation like in August for example) I find that tick or volume charts are much better than time charts.

Having said that we all have to find what suits us and there's no such thing as a right or a wrong when it comes to picking the type of charts or a time or a TICK chart.

Tossed in the towel as far as using ticks :confused:

I found it way to confusing. Just too many bars to deal with. It got even more confusing every time I looked over at the one minute candle chart on system #2. There was just no correlation and that was throwing me off.

So, back to using time candles... running one minute on the main system along with the synchronized volume bars. I did keep the stochastic study and the money flow index study. Both of those did offer me confirmation for good entry points.

Maybe others out there will have better luck. Was worth a try, though.
 

stillkicking

Member
71 17
Lately, I've found the market to be very choppy, if I can use a technical term ;)

Not as easy to make a profit as it was just a month or so ago. Many head fakes and very little follow through, intraday. The momentum that was there is no longer nearly as strong.

Now, I cannot speculate what this means long term only to suggest, if it is here to stay, making $$ has just become way harder.

That said, it has, for me at least, become more an issue of protecting capital. Tighter stops are the law of the land. Sometimes the stock does reverse but I also find that, more often than not, it takes a nose dive.

Penny stocks, like those I trade, are risky to say the least.
 

stillkicking

Member
71 17
"Sell in May and go away"

This old stock market saying has actually been proven true time and time over the years and it's one I'm finding applies to day trading, as well. The momentum is just not there in the market, as I stated some weeks ago (see above).

I, for one, plan to sit out the next few months and wait for things to pick back up in the fall.

For now, I'm enjoying my Summer. Plan to buy a small plane and go back and finish my private pilot training.
 

lmans66

Newbie
7 1
I use Yahoo Finance forum which shows one minute charts... My question is; when I look at a stock, how do I really know if the next minute it is going up or down or going to stay up /down for the day? There is no way. Only in hindsight can I see. But when I view a chart like I am viewing now (AMD), I can see where the stock was edging up nicely, but wham...it went down. Then wham, it went up again. Given that, during those lows and high Whams, what clue is there to buy or sell or hold ?
 

stillkicking

Member
71 17
Just got back in the game after sitting things out since early May. Found a few new things to talk to about and will be posting soon.

Happy Thanksgiving to all
 

stillkicking

Member
71 17
If you haven't learned by now, trading low cost or penny stocks (those between $1 and $5) is fraught with fraud, scams and just plain funny business. The majority of these companies have less than stellar track records in either the way they conduct business or the products or services they purport to offer. Therefore, buying into them is buying into what is basically a scheme, in most cases.

In order for us, as day traders of these gems, to come out ahead of the game and hopefully make some money we need an edge. Something that can give us more than just a shot in the dark of picking out one stock on any given day that might possibly be a runner. The holy grail for any day trader.

Something I'm now beginning to use, and suggest others take a look at, is combining reverse splits with news.

Investopedia defines, in part, a reverse split as:
A reverse stock split is a type of corporate action which consolidates the number of existing shares of stock into fewer, proportionally more valuable, shares. The process involves a company reducing the total number of its outstanding shares in the open market, and often signals a company in distress.

A company usually does this when their stock has dropped to less than $1.00 per share and they have been notified by the SEC to get it back above a dollar or get de-listed from the exchange.

The procedure is to take a penny stock that has had a recent reverse spit and place that stock into a financial news aggregator. Then, when that company follows their reverse split by releasing some news to try and further pump up their stock price, we have some advance notice and can move it to our watch screen for that day. In many cases, these stocks will become runners... if even for one morning. If we can catch that upward move early enough, we can make some money.

Source for stock splits: Stock Splits

Financial news aggregator:
CityFalcon
 
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stillkicking

Member
71 17
The Power of the Daily Chart

As a trader, I find it useful to get in the habit of running every potential day trade through the daily chart setting to get some idea of where the stock has been in the last, say, six months. While some may argue this will not do much for a day trade it may protect your pocketbook should the trade go against you (trading long) and you do not get out in time.

Here's what I mean. This is a one day chart of a stock called CPST. They're in the generator manufacturing business, for those who even care. To look at this one day chart it's near impossible to make a clear decision on whether or not this stock is even worth following. I, for one, would not be much interested in this stock, based on this chart.


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Now take a look at CPST, over the last six months, on a daily chart. The company's stock price picture gets much clearer. Their stock has been on a downward trend until recently. They've had over two weeks of relatively strong days towards the upside and, perhaps, that trend will continue in the near future.

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Bottom line, here, is to run your picks through a daily chart so you do not get blindsided by the occasional pop in stock price. Especially if you plan on holding the stock as a swing trade over several days ...or... you get stuck doing so as I sometimes do :confused:.

Full Disclosure: I do not own CPST not do I plan on doing so in the near future. I am using it only as an example for this post.
 
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stillkicking

Member
71 17
Get in and get out

As I examine my most recent day trades, along with the earlier ones made back in the beginning of the year and end of 2018, one thing clearly stands out. The longer I'm in the trade the less of a chance I have of turning a decent profit.

My most lucrative trades were made in less than an hour and, in most cases, in less than 15 minutes. The longer I stayed in, the less of a return I made and, in many cases, it want against me and I took a loss.

One trader I follow claims he is only in a trade for 20 minutes from 9:50 to 10:10. I'm not sure I can emulate him with the stocks I trade but I tend to agree the best money is made before 11:00AM.
Yes, I've seen the push from 11:30 to noon and yes I have seen stocks rally late in the day. But, I have also seen them tank more often than moving much higher than they were in the morning.


Would be interested in hearing from others on this.
 

stillkicking

Member
71 17
I've updated my "penny stock" day trading checklist.

If I follow it to the letter... I can do alright. When I don't, I will usually get into trouble.

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stillkicking

Member
71 17
Going long... with my monitor, that is.

I use Think-or-Swim for my trading platform.

I make the trades on one 16x9 screen, run by it's own computer, and I set up the stocks I'm watching on another, older, 19" 3x4 screen, powered by its' own computer.

Until now, I had four stocks on this screen but I find now I can easily keep an eye on more. When I tried adding six stocks the TOS software would combine the volume bars mixed in with the candles and it was unreadable.


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The poorman's solution was to flip this monitor on it's side and set the screen to run in the portrait mode. This gave me my six stocks with the volume bars running separately at the bottom, as before.

No more clutter!
 

stillkicking

Member
71 17
The pop that refreshes

Some days, I think I'm smarter than the market and rather than take a quick profit after initiating a penny stock buy I hold out for more $$. That often comes back to bite me on the butt. I end up sitting on my shares way too long and, having pulled my stop, watch the price drop.

Luckily, there can be a sliver lining in all this and it's what I call the pop that refreshes. I will cancel my sell order after the market closes and place a new one set for GTC_EXT, good till cancelled extended. This has my sell order working after hours between 4:00PM and 9:30AM. If the planets are aligned in my favor I will often times get filled and be done with that nasty little stock.

Important to note that my fill usually will be at a price not seen again for that stock during the following trading day. What happens is the stock price will pop up just for a split second and take me out. If someone wants this stock badly enough and my shares are the only ones left to buy (remember it's after hours now and things are slow) they will end up buying them.

As is often the case with penny stocks trading on a weak catalyst, they become one hit wonders. Up one day and back down the next. If you still own them at the closing bell you may own them forever. Try this next time and you may be surprised.
 
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