Dinerotrader

I am not too familiar with these futures. What is the going rate right now for one contract and what is their tick in $?.

Follow up post on my results. I just keep stewing about the fact that I messed up my entry and stop on this one. The bounce off support was anticipated but I executed poorly. This is one of those trades from which I will derive some type of rule for future trades. It is hard to post such a bad trade but exposing wounds seems to keep me more accountable next time to not do that same thing.

YRCW -$0.06/share or 1% I wanted to short today but I had to use my account that I can't short in so I had to look for a long. Risk reward looked good but I took the trade just before the lunch slow down which was a poor decision. Dinero

So here is one I was watching progress today. This would have worked great with this strategy. Resistance appeared significant based on the major swing which touched resistance twice and then reversed down. The first pic is where I would have had my short filled and the second pic shows what happened after it. The breakout buy stop could possibly been filled filled since the tiny move above the resistance line was made but it would have been a close one. It depends on how far away from resistance I put my buy stop. Short side Here is how I might put in the short side of that order. If price hits 21.42, trigger an order to put in a sell short market order at 21.38. If that short is filled, a stop loss would be put in at 21.48. Long side Buy stop would be entered at 21.50 with a stop loss at 21.38 (I know that is a close stop loss but I am only interested making this trade work when price is moving in one direction or another). I will take a loss if price starts to chop around S/R. Prices and order mechanics 21.52 21.50 - Buy Stop 21.48 21.46 21.44 - THIS IS RESISTANCE 21.42 - trigger 1 - enter trigger 2 order 21.40 21.38 - trigger 2 - sell short order / Stop loss here on if the buy stop filled at 21.50 21.36 21.34 I don't know my short sale rules and laws all that well, but it is possible that this type of strategy is illegal for stocks, I just don't know. It might only work with futures or currencies. Let me know your thoughts.

Currently, I am not pursuing options for a variety of reasons however I am aware that options have a strategy called straddling. My interest is in using this strategy for futures or equities.

I have been considering doing some research into the following trading strategy for futures and I wondering if anyone could share their wisdom or past experience with this idea. Basic trade strategy set up Step 1: identify relatively strong resistance or support. Step 2: Straddle the S/R level with a sell and buy stop order once price gets reasonably close to either bouncing off S/R or breaking out. A buy stop would be placed a few ticks above a resistance level with a stop loss below resistance A sell stop would be placed a few ticks below resistance level with a stop loss at the same place your buy stop was placed. I always like visual aids so here is a quick chart to illustrate how the entries would be used around the support level. It is not a perfect example but you get the idea. The obvious idea is that price should reverse or breakout of that level so you are hoping to grab the larger move with a small loss on whichever side proves to be wrong. If price reverses as it hits resistance, your buy stop will not be triggered so you will not have any loss if price just reverses down. If price breaks through resistance your sell stop will have triggered but will stop out just as your buy stop executes so you will take a small loss which would hopefully be over shadowed by the momentum of the breakout. I haven't gone through much testing on this yet but my guess is that the main issue with this strategy will be avoiding getting stopped out if there is chop at the S/R level. IMO, the largest problem with making money in the market is the chop of the price. If the market moved in longer waves up and down without the chop, it would be easy to cut losses when you bought at a turn in the swing and let the runners run. Given this simplified analysis, my thought was how can I find a place in price movement that appears to have the least chance of being full of choppy prices and S/R seems to lend itself quite often to this. I have watched price completely reverse or blaze right through a resistance level so many times. I haven't heard this idea discussed much so it probably has some major problems which I am not seeing at the moment. I'd appreciate your insights before I go and spend a lot of time considering this strategy. Let me know if this makes enough sense to discuss. Thanks.

JDSU +$0.30/share or 3.8% Just 1 trade today.

2 trades FFBC +$0.25/share or 2.5% CVH +$0.04/share or 0.2% Stuck to my rules and trailed stop at all natural stop points.

I was just thinking about the broad theoretical use of a stop loss and I know many traders do not use position sizing to manage their stop loss. I agee 100% with your post.

I marked up a new chart of HGG at higher highs where a buy opportunity looked reasonable and noted the corresponding stop at the last natural support level. My thinking on the stop is that it should take you out before you lose more than you are willing to risk on one trade or take you out if price action starts confirming it is going to move unfavorably in comparison to the reason you entered the position. Additionally, if price starts to move below the last natural stop that would be an indication through price action that there is a high probability that price will begin to move against you and therefore you should be out of the trade. In my first example, I noted that I thought the stop was too close since price ran back very close to the natural support level and the moved back up. Given that support is more of a small range than it is an exact price my belief is that I should have had the stop $0.04 below the last natural stop to give a little wiggle room for support to hold. However, you have much more experience with this so your thoughts would be useful.

Another good learning day. My stop was too close to last natural stop. Would have been a good trade if I had trailed as I think I would have trailed it. HGG (-$0.31/share or -1.7%)

That is exactly the wisdom I needed. I really appreciate your thoughts and ideas. You can expect better entries from me from now on. Quick question: I know you usually put your stop loss at some natural support level below your buy but sometimes those seem like they would be too large to keep your loss average so small. Do you have a maximum stop amount you use in the event the natural support level is too far from the entry or does that just mean the R/R isn't good enough to take the trade?

I think a good way for me to judge a trade entry will be to ask the question, "will I be ashamed to explain this entry reasoning to thales". 1st Entry The 1st entry I am ashamed of. FNET had a lot of excitement and after watching TIV go up 200% the other day I think I was just looking to buy a pullback instead of watch for a good breakout. There was a little bit of up tempo in price so I bought in and the price just stayed in the downward channel. 2nd Entry This one I am more comfortable with my entry. I say the channel break and price crossed a recent high from the channel. I tried to let the trade run along and moved my stop to breakeven. This chart shows some more defined channel breaks I could have taken for a possible small gain if I had trailed closely. The morning offered the best buys but I have a huge problem in that I can only start trading 2 hours after the market has opened. Once daylight savings time changes, I will be able to start trading 20 minutes into the market and I will focus more on higher high breakouts. I'm not taking any daytrades today since all my swing trades are riding up with the market. I'll try to firm up my trading rules and policies today. Thales, thanks for asking.

I actually use Wells Fargo right now since they give me free trades but I will be switching to Ameritrade soon because I need more bells and whistles to manage my trades. Ameritrade also gives you access to TOS since they own them now. I am sure others have more wisdom to offer about brokers.

I thought I had FNET under control today and it worked me twice. I worked on controlling my emotions during the trade in an effort to remain calm and accepting of the result. I tend to want to start counting my profits as soon as I am in the money which is not good for my money management decisions. I'll never let the winners run if I do that. I just keep thinking, "what would thales do" and that seems to get me back on track.

Thanks thales, If you look at the chart for TIV you will see I should have made a lot more. The first sell was a mistake, the second was just fear driven because my mind kept thinking that the stock was already so over-extended that a sharp drop was highly probable and my broker won't let me stop loss these tiny stocks. These small stocks tend to move much more than the higher priced stocks and I need that movement to make the trade worth while given the amount of capital I am using. The actual points I marked aren't perfect but you get the idea.

I was happy with today but very frustrated I missed a large part of the TIV move because I had a sell order in which triggered as the price flew past it. Today and Yesterday's P/L

I've been lurking on here so long I thought I would post my meager results for my stock trade today. I am still paper trading futures but my stock trades are with real money. This was the only daytrade I took today. Stock: DPTR Buy: 2.85 - bought because it broke out of its downward channel Sold: 3.14 - sold because I felt comfortable with the profit and the volatility was increasing $0.19/share profit

Wow, this thread picked up lately but of course they usually pick up when someone throws the old “95% of people fail at this” statistic. We should seriously make a section of the forum just for discussing that idea since it crops up so much and derails the thread. ckait: I do still monitor this thread and all threads I have been involved in. Not rich yet but I am enjoying the journey so I am content thus far. I keep many irons in the fire as far as business ventures so I haven't had as much time lately as I have wanted to post and day trade. jobig04: I like your point about “being wrong and losing money” as big obstacles to the average person. Thank you all for your posts thus far in adding to the idea of pros and cons of the trading life. I know that becoming a profitable daytrader without having the desired lifestyle would prove to be a failed venture. Every time I read my original list that I started this thread with I am motivated to put more time into building my trading skills. I evaluate business opportunities quite often and the daytrading business really has a great list of pros compared to many other investment opportunities. It is always helpful to hear from the experienced profitable traders about their view of pros and cons. Cheers.

I missed noting one important attribute. I need the broker to be web based. I only need them for order entry and order management. Not for charting or research. I can't download software on my work computer. I have looked into thinkorswim with high hopes but their interface is not good and totally not intuitive IMO. From my understanding IB, Tradestation, etc. are all platforms which need to be downloaded to function which would not work for me. I guess I am looking for something similar to a TDameritrade or Scottrade except I was interested in the DOM/tower trading set up but maybe that is only available with software based brokers. Sorry for forgetting the web based issue on my original post.

I found this post on "A Tale of Two Trades" interesting and have nominated it accordingly for "Topic Of The Month August, 2009"

IB and tradestation do provide stock trading. I haven't tried either yet but I thought there might be someone out there that trades stocks and has some great things to say about some particular order system, in which case I would try that one first. I will look into cybertrader. Here is a picture of the infinity order tower. It doesn't need to be exactly the same but this is the idea. To adjust the stop level you just drag the cell up or down. Cheers.

Does anyone use a good broker for stock trading that has a tower setup for the order managing similar to infinity futures' tower. Reasonable commissions would be a plus but I am mostly interested in a good order system with "drag and move" function for stop loss positioning. Intuitive and simple flow with a solid set of auto order functions. I keep missing out on additional profits on my stock trades because of my broker's poor ordering system. Let me know if that is an adequate description of what I am looking for. Any advice would be appreciated. Cheers.

Well, it looks like my anticipated resistance levels were correct, I just failed to manage the trade properly. I should have either moved my stop up so I could have taken some profit or kept my stop where it started so I wouldn't have gotten stopped out before the move back to the upside.

Trading the GBP/JPY. The resistance level that broke appeared pretty strong since that zone had been tested several times so I would anticipate a strong move up. Update: New resistance level is occuring in expected area. Trying to keep stop low so I don't get stopped out in the chop. Update. Stopped out. Probably should have move up the stop once I saw so much resistance at the 2nd green line. Your comments are welcome.