Trading the US the Naz/Mr. Charts Way

J.O.
I second Richard's comments about your thread as well as his comments about its hijacker who clearly has an agenda of his own. Sadly, such folk have no interest in intelligent debate and no respect for the views of others.

Richard,
"I really feel someone should only write what they know quite a bit about and not pontificate on areas in which they know very little. Otherwise beginners gain nothing from BBs but expanding their range of ignorance".

To be blunt, the vast majority of starters and intermediates, (can't think of better words), think that if someone sounds as if they know what they are talking about on BBs, they must know more than them. There is a tendency to accept what people say as being correct as they try to glean nuggets here and there. Usually the nuggets are fool's gold. IMHO, that is one of the reasons most people try and fail.With the above quote in the forefront of my mind, the following comment is offered as a suggestion only - and one which you may care to comment on.
My understanding of the way you and Naz trade is roughly as follows:
Although there are similarities Alan and I have many differences in our approach and how we trade.1. You each have chart patterns that you favour which are often (but not always) linked to a story about the stock in question - e.g. broker upgrade, earnings report or new product/service etc.
Also core trading stocks and other methods
2. Your experience tells you that a price movement of some sort is likely to occur - either up or down and sometimes in both directions - from which you can extract a profit.
Yes
3. The force (read momentum) and direction of the impending price movement is dictated by the extent of buying pressure, evidenced by the number of buyers at the ask or, conversely, selling pressure, evidenced by the number of sellers at the bid.
No not merely the numbers, that is not the major factor - maybe 20%
4. As the pressure builds up, orders get filled, momentum cranks up and the price starts to move. At this point, your skill and that of Alan is to ensure two key things:
Momentum often starts suddenly BEFORE it appears on a chart. I realise that sounds odd, but sometimes there are signs of the impending momo BEFORE it happensA. That your order is at the head of the queue and is filled early on knowing that there are a lot of other traders who think as you do and want a slice of the same action. (Safety in numbers).
Mmmmm........not as such, sometimes you can enter before the move is obvious because you've been forewarned by movement WITHOUT price change, so you needn't be fastest at all.B. That as momentum starts to fade towards the end of the move, there are still a few late comers at the back of the queue to sell to (assuming a long position, obviously).
Oh yes ;-)))

The bug bear for us mortals is that you and Alan make this process look and sound so simple which, for many of us and me in particular, it ain't.
There I don't agree. I use charts and other means to find potential movers then look at level2 T&S buy/sell pressures at certain levels. The latter often act as confirmation/denial. Sometimes they tell you nothing. This is a huge help with break outs as very frequently what I see will tell me if the break out will or will not succeed. Not always and not absolutely, but with a high degree of probability when the trigger occurs. It's like being able to tell if a volcano
is going to erupt or not. Or to put it another way, you are a better driver if you can anticipate the road ahead well. I really honestly don't think this business is any more difficult than driving through Central London or on a motorway. It looks amazing if you are not familiar with the rules of the road and how people behave and have no experience.
Hope that helps Tim
Richard
Tim.
 
I'm watching the brokers like MER LEH etc. today and
CAFE
RECN
BOOM
BWLD
COOL

Richard
 
I thought someone might be interested in my trades, following on from indicating my hot list pre-market in the last post.
BWLD shorted 33.33 and exited at the moment of the screen shot for
+70 (for those who like to work out return on capital employed that is 2.1% in 21 minutes.
 

Attachments

  • BWLD.GIF
    BWLD.GIF
    5.7 KB · Views: 243
And the other one was COOL long 3.37 and exited as on the screen shot for
+26 ( return on capital employed 7.7% in 20 minutes)
Obviously I take a rather larger position size with a $3 stock than with a $33 stock.
There are always moving stocks on Nasdaq even when the index isn't moving much itself, so nasdaq is currently down 0.1% and the Dow is up 0.1%
Both of these trades were taken at the breaks of early lows and early highs respectively and my micro analysis of level 2, T&S buy/sell pressures confirmed the chart set up.
BWLD was a 1 min candle chart and COOL a 5 min candle chart.
Richard
 

Attachments

  • COOL.GIF
    COOL.GIF
    5.3 KB · Views: 232
Nice trades Richard

Do you have a minimum price of stock that you'll trade?

I was always under the impression that low valued stocks like that were hardly worthwhile.

Regards
 
Hello The Beyonder,
It depends. If it's a $7 stock that moves through 40c in a day, I'm not interested, but when a $7 stock loses half its market cap overnight then either there will be very little movement and I won't be trading it, or many people will be thinking it's got great potential to move. I then simply see if it triggers one of my set ups then zero in for micro-analysis to confirm or otherwise. That for me makes it worthwhile.
Hope that helps,
Richard
 
Ranges

Here's another of my favourite set ups involving break outs - worth waiting for but involves a lot of waiting. Not for those who want continuel action. Two shorts.
 

Attachments

  • euro1.JPG
    euro1.JPG
    114.1 KB · Views: 210
Hi Mr Charts
Was wondering if I could be so bold as to ask you how you find your stocks(#194)As these do not seem to be your normal basket stocks.Do you use a scanner?are these news related trades?
I myself have found that stock selection is extremely important,to trade the movers and not get stuck in ranges,unfortunately finding these movers can be a bit of a problem,hence the question
 
How do you know what my core trading stocks are? :)
To answer your question, I choose the stocks on my hot list using several methods, but it's no secret that only some of them are news related and I have specific criteria that need to be fulfilled before they get on that list.
The hot list changes during the day and I only put the pre-market ones on this BB occasionally, as I did today.
Richard
 
Pound

Hi campers,
Yesterday I was stopped out of a trade and finished for the day, only to peek at the screen later to see I could have entered again and made a profit. Shows you cannot be around all the time to catch trades. Today was better - stopped out of a long and enterd a profitable short. 5 min. charts once again and I favour break outs. Doesn't always work hence my tight stops.
 

Attachments

  • gbp1.JPG
    gbp1.JPG
    175 KB · Views: 226
Hi neil,
I see your old friend CAT has been highlighted by Jim Cramer as likely to have a blow out quarter.
He was negative on steel stocks, which is probably correct. STLD might be interesting today.
For people unfamiliar with him, he is the latest "must follow" TV guru in the US on a show called "Mad Money".
I'm reminded of the classical UK and US pump and dump ops, but I'm sure that doesn't apply to Mr. Cramer.
Anyway post market trading and pre-market the following day often reacts to his show, creating opportunities for profits.
Richard
 
euro Monday

Not Today said:
Hello anybody home?

Oh allright then.....
Here is an overnight breakout albeit it presently seems weak but lets leave a stop at 2209 and wait.
 

Attachments

  • euromon.JPG
    euromon.JPG
    122.1 KB · Views: 194
general question for naz/mr charts.

In your opinion what is the most important with regards to trading success.

Money Management?
Psychology/self control?
Understanding of TA+Fundamentals?

What percentage of importance would you give to each of the above.
 
I am going to have a crack at this one if i may. For Intra day trading I would say the following :-

Psychology/Self Control 50%
Money Management 40%
T/A and fundamentals 10%

Both psychology/self control and money management are down to discipline.
application of T/A and fundamentals could also be down to discipline.
therefore as long as you have a tried and tested trading plan that gives you a winning edge - and you follow it with 100% discipline - you will be successful.
So simplified :-
Develop a plan - then use 100% discipline.
 
Sorry not to reply sooner but I'm in the middle of a busy coaching schedule.
Samtron, there's a lot in YHABoy's answer, but there are many other things involved as well.
To address your specific question, imo, it cannot really be answered as the question is like asking which is more important in driving, steering, braking, changing gear, reading the road etc.
Again I would be unsure as to the practical purpose in asking the question unless perhaps you feel one particular aspect requires more attention in your own trading and you are trying to ascertain whether it is relatively important.
Richard
 
Mr Charts/YHABoy

Thanks for the above two replies.

In a few books I have read on the NASDAQ I have come across the term "In the pre-market"
"the pre-market was doing this/that" etc

When they talk about the pre-market activity what are they referring to?
 
Top