Swing/position/trend trading NASDAQ stocks

[pb]

If I have decent strategy that works for LSE stocks and makes me money, is there any reason it won't work for NASDAQ stocks? The strategy is very simple really, it's my personalised version of Stan Weinstein's medium-term trend following method using high volume breakouts.

There is a lot of discussion on T2W about day-trading NASDAQ stoks, but very little on swing / position / trend trading (I really did search). I guess I am just not ready for intra-day trading yet, but would like to get used to direct access and a market that offers good moves.

The question, more generaly is: will traditional TA on a longer time-frame continue to work on NASDAQ stocks given that they can move violently intra-day?

Thanks in advance.

 

[TheBramble]

Pratik, TA is TA.

I occasionally move from intraday to longer term when I'm too busy to devote 100% of my time to the screens.

The only issue you may find in moving to NASDAQ is, as you say, the comparatively higher volatility of some stocks compared with the slightly more relaxed FTSE crowd.

My suggestion is to take a look at the historical volatility (30 day or so) of the stock(s) you're looking to trade and take their 'breathing rate' into account.

I'm not familiar with Weinstein's work, but trend following and volume break-outs will work (as well) in any time frame.

 

[Mr. Charts]

Pratik,
Many, but not all, successful intra-day approaches do work multi-day.
However, may I suggest you at least check to make sure results are not coming out during the period you intend holding the position. Of course you might be long in anticipation of good results or vice versa, but you are introducing a much greater element of uncertainty. Don't assume price will rise on an EOD basis with what you consider to be good results either. They often fall.
Perhaps you might also consider a fair degree of diversification across stocks in different sectors. For example, don't have a large percentage of positions in semis as a major co coming out with bad news is likely to have an adverse effect across the sector. Also consider balancing longs and shorts in a choppy market.
If you think we are in a secular bull and want to be entirely long, then consider buying some cheap deep OTM puts as insurance against a catastrophic event like 9/11. Read the options forum for more info or Lenny Jordan's book is very good for beginners.
Richard

 

[MangeMan]

I mostly swingtrade, you don't have to trade as often and when right you can be very right (qualcomm anyone) by using trailing stops.

On the flip side you don't want to own Merck shares when they withdraw vioxx, these things can happen but stay away from companys that rely mostly on very few products and also you have to know when they report earnings, when other companys report earnings that could affect and when the might have mid Q updates like the semi's


My hero is Jesse Livermore, when right sit tight, this is how I do and it does produce nice profits (I also trade intraday though), you will be in any long trend and finally stoped out when it changes, there is no reason taking a profit just because it's a profit, take it when the trend changes or when some major event changes the whole idea of that position.

 

[ketch22]

If interested in trading something less volatile then try trading the Q's. Nas 100

http://stockcharts.com/def/servlet/SC.web?c=QQQQ,uu[h,a]daclyyay[pb50!b200!f][vc60][iut!Ub14!La12,26,9]&pref=G

 

[Pollux]

Pratbh,
As an avid swing trader, I came across your post with interest. I concur with the gist of what has been said above. The key is to work with the 'grain' of the market so to speak and always look to trade Nasdaq stocks in lockstep with your chosen index (QQQQ -- Q's -- is the clearest and easiest to use). For low risk swing trading, restrict yourself to patiently waiting for identifiable Q's patterns emerging out of basing areas (consolidation areas) with as many confirming pieces of evidence that the 'emergence' is indeed a sound one; then and only then cross-refer with your small list of monitored key stocks. If the setup is a good one, often you'll see strong patterns in the same hourly and daily bar on both index and individual stock. This can be very helpful in leveraging up your position to a meaningful level to gain exposure to the move. Good luck and keep swinging those singles...

 

[vergis92]

I mostly swingtrade, you don't have to trade as often and when right you can be very right (qualcomm anyone) by using trailing stops.

On the flip side you don't want to own Merck shares when they withdraw vioxx, these things can happen but stay away from companys that rely mostly on very few products and also you have to know when they report earnings, when other companys report earnings that could affect and when the might have mid Q updates like the semi's


My hero is Jesse Livermore, when right sit tight, this is how I do and it does produce nice profits (I also trade intraday though), you will be in any long trend and finally stoped out when it changes, there is no reason taking a profit just because it's a profit, take it when the trend changes or when some major event changes the whole idea of that position.

Hi there,
I'm new to trading shares , I'm very interested in highly liquid markets and US shares
in particular, can anyone advice what's he best way to trade undervalued shares
when buying in an apparent decline of the us markets ? ( spreadbetting won't work).
can CFD's margin trading work or is it best to go for a full size acc?
The objective is to take profits should the stock rise substantially but also be able
to keep it for as long as one year should you reckon it's undervalued and set
to rise again .



moreover I'm impressed by valuations (estimation of the intrinsic value)
of a stock as performed by some specialists, they prevented me from buying
(ALKS) when it was at its highs, it failed catastrophically despite
what they were saying back then, and also recommended (mer) as a buy when
it was at $40 more than two years ago , what valuation method do you think is best to use?
anyone please