SIUYA

you can buy as little as 1 share in a stock as opposed to maybe a mini in futures stocks are likely to have bigger % moves than an index you can diversify there are more stocks to look at - a larger universe While many of these things dont necessarily apply to day trading.....I think one thing that futures offer - implied leverage is often misused by many - this is not often given in the stocks which saves moany people. The greatest thing for me about futures and fx is the ability to short without the pain and admin involved when shorting stocks

You are still missing the point - Motley fool, broker recommendations, cheap, discount....all of these things are pointless when trading off the chart - and yet all of these things are (and correct me if I am wrong here) are things that you have brought up...?? I just thought it was interesting that someone would comment on it. (Sorry for going on about it - i was trying to push a point - lets just forget all mention of fundamental info, other peoples recommendations and such) While your basis for the the trade was VSA, these extra things sound just like justifications to help reinforce your belief. At least IMHO you are using the right terminology in saying that most technical analysis provides a "clue" as to what might happen in the market, and recognizing that we dont really know until the story unfolds. All we can do is look to participate on the plan you might have....regardless of motleys, regardless of all the extra noise. If I am sounding pedantic there is a reason for it - but it can make a massive difference in how you approach things (get the book Drawing on the right side of the brain - and do the exercises - it should amaze you at how much this stuff can affect your approach to many things) If you get back to the basics of why in this particular stock was frustrating...... it appears that you think (with hindsight) that your stop should have been set at a larger level - so ask yourself - why did you set a stop at 0.5%? was it based on your past back testing, your past trades, or was it just a number plucked from thin air. In the future are you going to just use a random number or pick a number and stick to it - hint random numbers can give you flexibility, but they will cause frustration IMHO - its a trade off as you knew you were trying to pick the bottoms - this is a frustrating exercise by itself (even if it can be profitable) - so why should you be surprised when it turns out to be frustrating. The stock on a short term basis is clearly in a downtrend - you choose to ignore this in order to pursue the strategy you choose - you have to accept the negatives associated with that strategy - one of those is frustration. all of this is regardless of the method - I dont need to know anything about VSA, or any other method to know that picking bottoms against the trend is wrought with frustrations. Period. So you are getting what you should expect from the market.......are you not?

http://www.traderslaboratory.com/forums/attachment.php?attachmentid=24839&stc=1&d=1307411300 (apologies for the advert that covers most of it up)

my broker recommendation is on a basket of stocks I invest in - not necessarily trade and its a completely different strategy to day trading, but the reason i put it in is to show that ideas of cheap and expensive when applied to stocks are pointless to a trader.( The stock is down a further 15% again today - I exited yesterday, as even though their fundamental long term ideas seem to make it seem cheaper to some, for me the catalyst for a stock reweighting has not materialised and so my reasons to remain in the stock have gone.....how many brokers will tell you it is cheap at $1.00 and if you liked it there its even cheaper at $0.50 and so you must really love it here, and so at $0.02 sell the house, invest it all and live in loving ecstasy.) Point is that again you used the word cheap - saying the market thinks it was cheap. please bear with me on this...... how do you know the market thinks it was cheap at that level? Was it short covering maybe, was it just a bunch of old orders, market weighters, people spreading against other things, option hedgers.....and who cares what the market thinks is cheap, they are long term investing.......what you are after is areas that the market will provide support. You as a trader want to get away from the idea of cheap as it will put other connotations that might affect your thinking. eg; the market thinks its cheap therefore i think its cheap therefore if i get stuck with this its fine i can turn it into a long term investment because the market thinks its cheap. Its too easy to go down this path, hence the reason why I suggest using such words can put your mind on the wrong mindset.....thats all ....how you do that - vsa, fibonacci, elliot wave, oscillators...whatever is not so much the issue. (EBIX - i just read a report from the motley fool in it they push the idea it is cheap again based on fundamental information in it they say ""shares now trade at a big discount to where they were just a few months ago."" ...... What does the word discount imply??? is it relevant? How big a discount should it be? Is it really at a discount - or was it just too expensive before hand? Where is the bias..... as a trader you want to get rid of such words.....they often dont help clearly this person does not believe the hype....a comment from a disgruntled investor on the motley website 6th June.... "This article is a joke. EBIX has lived and died by Motley Fool and Seeking Alpha. Raina and his so-called "board of directors" must realize that they have to live and die by rumour and speculation. That is Wall Street. As for the CRM that EBIX provides: it is a joke, antique, cumbersome, outdated and just does not work. Just ask any user of any of their products. BMC, VMWare and Salesforce are legitimate, transparent companies that offer a dynamic product that works. The same CANNOT be said for EBIX. So please stop pontificating about this card-house company. Try what they have on offer and then write you articles about what they offer. As for their so-called "growth", it is BS. Raina buys a company, slashes the payroll and calls it growth - PLAIN AND SIMPLE! Reveunes stay the same or decrease. Wake up Motley Fool!"

Sorry as I am in skeptical mood this morning..... Fibonacci levels have been used well before computers billions of traders - you are kidding right...sounds like an internet company trying to raise funds. "at the end, we will draw the conclusions"............sounds like you already have

one i had not heard till this morning and then the retort from someone else said it all... "there are plenty of ships at the bottom of the ocean that had charts" to which the reply was.... "learn to read a chart and you wont hit the f...n iceberg"

The point about ego is that it feels great, its intoxicating, its addictive to take on the market and win....problem is its tough to win consistently.....so its no comment on your ego per se....just that often what feels good, is not a good habit in the market. thats a good risk reward ratio....so why did you not capture it - usually because hindsight makes it look easy but reality makes that RR very hard to capture at the time of the trade. Again here is the crux of the point - the smart money, the right money is not buying - they have been selling and exiting the stock as the bigger picture time frame shows its in a down trend of recent time. For long term investors maybe they are buying on the back foot - but that is not you - you are short term trading. When people panic - it can be good if it coincides with other levels eg; good support, maybe a fibonaci level..... looking at the daily and weekly EBIX nothing really stands out. Support at $15 looks more interesting, while the highs of Mar 2010 could be argued to be support, they were a fair while ago, and hence again more relevant for longer term folks. You are always taking on the market, but what you want is to go with the market.....its like the ocean....you can certainly get out through the waves....it makes it easier when you go with a rip, and yet the easiest thing of all is to catch the waves back in. (a golden oldie analogy) Also - while its just a word/terminology it certainly does have and will give you certain mental connotations that can hurt a short term trader...... we all do it but i hate using the words overbought/oversold/cheap expensive..... what you think is cheap may be expensive to others, but it will anchor your thought process in terms of the ideas of value that we all have. Cheap should mean nothing to you as a trader....think in terms of where is a good price level to go long where if I am wrong I can get out with a small loss - where is the value trade. When you think cheap, it does not help you, it makes you think in shopping or investing terms. There is a great book called learning to draw with the ride side of the brain (every trader should buy it just to see how the brain can be tricked). In it they get you to do exercises to teach even the most un-artistic of us to draw. One exercise is to train the brain not to think in terms of I am drawing an eye, a nose, a mouth.....instead you think in terms of I will draw this line relative to this line, relative to this shaded area.....I (and the book) guarantee that your drawing skills will rapidly improve. On saying all that......I understand why you are doing what you are doing and your feeling of necessity for it. With that you will always find it frustrating because you are fighting the rip, your mindset is all askew and you are placing yourself into setups where the timing as well as everything else is critical - the margins for error are unforgiving.....rewarding when right but unforgiving when wrong. (I got wacked today - I had 1% of my investing value portfolio in a stock PLV-ASX down 43% based on a broker recommendation of it being cheap and a different strategy I apply . Its in a different part of my long term investing portfolio, but clearly his idea of cheap does not stop it going down! It hurts but its not the end of the world )

Then it sounds like you should drop this pattern, end the frustration and make money...................... Extending your stop is not the issue as an outside observer.....it will reduce your size per trade, but at a guess you might still get stopped out just as much, and if your size reduces enough doesn't that defeat the purpose of trying to trade a small amount of money for a living? Agree - context is important, the point I was making is that as a day trader, using VSA (or any other system to enter) then when the fundamental info is bearish you will be making it hard on yourself and frustrating. These sayings have impact on smaller time frames but they are generally long term fundamental investor sayings. Largely as they have done their homework and require the size of panicy people to get set. It is your last sentence here that I would suggest sums up your predicament...... You can see the short term 10% and feel if you can participate in this then its easy money. 1 - it seems that with hindsight, and 2- even without hindsight it is extremely hard to get 100% right and it is frustrating 3 - it feels incredibly fantastic when you do get these contrarian bounces - they might be good for the ego, but are they good for the bank account long term??? 4 - you appear to be looking for what seems to be the easy money when in fact its not - the market is a wicked deceiver 5 - if you do continue and decide to increase your stop, and you can still manage to get into these trades and get out at good levels - does the Risk reward suddenly look as good as it appears. Yes- people are clearly interested in selling! Not to Dis VSA, but often the rationale for why something seems to work is often incidental to this. Yes you are trying to participate in a bounce, with other buyers.....but what you really want is to buy at support where these buyers will provide enough volume to let you get out if you are wrong. In this case the buyers are not chasing the market (ideal if you are long) its more the sellers are temporarily exhausted....thats why it was likely to bounce. dead cats are better shorting that buying. Again...comment above, is it really an opportunity to be long, or a better opportunity to wacth the bounce and then participate in a short? Contrarians are often wrong for a long period of time, and will be frustrated a lot. they need resources to fight the market, patience, (there is that word again) - for the short term day traders who are contrarian - the ones I have seen that are successful have balls the size of a house, are constantly on edge. They dont have your pressures. They thrive of their own self induced pressures of taking on the market, and often they take big hits to their PL....something you cannot afford at present by the sounds of it (thanks I have finally worked out how to use the multi quote system )

let me be more blunt then (in order to I hope help )..... As I read it in your own words (maybe I am wrong here),..... you are trading intraday against the trend, and against the longer term daily trend in a pattern that typically will stop you out as you dont have the patience to wait for it. (typical being the word you used) You seemed adamant that VSA is what works for you and then you refer to fundamental information (CEO resigns, bad...CFO is going to resign....bad, and Motely fool "says" they had a good Q1...you are trading intraday who cares about Motely fool and the quarter by quarter analysis). You then refer to a few other adages that really apply to long term fundamental investors. You know you are trying to time the bounce in the falling knife and its not really working for you, and you know this. Its not me assuming you are doing something wrong..... its you who knows you are doing something wrong....hence your thread....and yet you continue to do it. Why is that? I understand your setup (at least the basics and price action), and think with all the other context thats applied I wonder why you are making it so hard for yourself and giving yourself the frustration and struggle. Others are adverse to the setup, because its a hard one to make money out of. As far as I can see these are not really my opinions but are what seem to be the evidence/the facts in this case.

Apart from knocking you down and destroying the dream of trading by saying dont trade.....as I am all for people following things and trying things. I also dont think people telling you how to do things is going to help, you need to work them out for yourself to be of any real value. At present......You will struggle with your money issues and your mindset I think which means not trading at present is good advice. A couple of thoughts from my own experience and in trying to get you to critically think about your method.....when you say "Bottoms became more attractive to me because I was trying to eliminate as much downside risk as possible. "".............this is only if you are buying dips in a bull market, otherwise picking a falling knife (while can be done) is tough and potentially frustrating. Recently this is not the market for it, and the stock drop you mentioned in the example seems more than a dip. "V-shaped bottoms.That is the ideal result, but it's obviously not the typical one on each instance" - so if its not typical, why try to go for them, and if its not typical, use some patience and go for the one pattern that is more typical. The discipline is to be patient, not worry if you miss the atypical trade. ""My "patience" issue runs amuck when I don't get the V-Shape and it ends up testing a slightly lower low and I'm keeping my stops too small. "..... a bit confused. If you get a V so what, missed opp that is rare. If you have patience and it goes to a new low, then it s typical loss, which will always occur - thats trading, also when waiting for the Higher low, you can either punt it or wait for confirmation in the direction you want, with a tight stop. A bigger stop wont help in this case as you have just confirmed with a lower low that the pattern you were trying to trade is now null and void. "Honestly, I've done nothing but watch dippers and bottoms for the better part of the last 2.5 years. It's not nearly as hard as you think it is.".......clearly it is! This is where I and others are suggesting that your mindset is not quite right. You say its easy, it looks easy in hindsight, but for some reasons its not working.....this is what you need to think about.

how to code it is out of my jurisdiction. However be consistent - if you put a time limit on it, or have a trailing stop - possibly the simplest option - then always do this every time. Some will win, some will loose. To say selling at the market after ten minutes is not the best option - why? you are out, and you can always get back in.

Enigmatics - my two cents. Stock dropped and it seemed a big drop, the market is definitely nervous if you want some context, and therefore I ask - why are you trying to pick bottoms? OK...so you say you are not adept at shorting and the market is slightly amiss for going long....then dont trade. You are not penalised for sitting in cash. Wait for the markets to become bullish again, develop shorting strategies (harder than you might imagine in stocks), or if you feel you must try and buy dips......here is a little hint.....be patient. There are not very many V shapped bottoms, often a stock will fall, rise, make a slightly higher low and then rally....wait and punt the slightly higher low. If you are wrong and the stock goes lower, you are in the same position as you are in - getting stopped out. If its a V bottom, so what it cost you nothing to miss the trade. If you are right you dont get stopped out only to watch it rally. Patience pays. Dont chase and hit offers in a nervous or bear market.

other - its not an oscilator, more an alert - the classic Donchian channel. Personally I favour a weekly mid point Donchain channel applied on a daily chart to help determine the trend - above indicates trend is likely to be up, below trend down - more than anything a cross over indicates alert to watch for other entries

there is nothing moral and/or no moral to the story, there is probably not even a conspiracy theory....point is this, and has IMHO always been a part of the market and is simply more pronounced now and quicker....no matter the reason behind it. Adapt, learn, adapt....lengthen time frame.... why as a retail person do people keep trying to compete and /or complain or even try to understand and think they know exactly what is happening with/about the algos. I dont think my 1998 Nissan pulsar with 180,000km on the clock is going to beat a top of the line new mercedes off at the lights, and if it did, delusional would be a word that comes to mind.

a couple of possible reasons. 1... a large pension fund/insto decided to sell a basket of stocks. 2....a large seller came into the futures index and arbs sold off the underlying stocks (you would really need to nail down which came first) 3.....it might have been a complete coincidence 4....algos might have been related to something else that moved and hence pulled bids which set off a chain reaction for other algos that rely on measuring bids etc;

Or maybe its just a result of the euro being the only major currency to invest in because the USD is so shot and the debt problem is not just a result of the Europeans having too much debt, but the US politicians having the same problem? otherwise, when do you ever believe a politician and think they really have a grip on economic forces?

the reality for most is nail biting, head banging frustration......why dont they show that in an add.

first you need to define what a penny stock is....market cap, share price etc; then IMHO penny stocks are more like binary options - you either make a lot of money or lose it. they are not really great for trading, but can be fantastic for punting as part of a portfolio. If you can get access to market data, they should all be there, it depends on how you want to analyse them - technical or fundamental.

Take a portfolio approach.....take two strategies you are comfortable with and look to combine them. No one thing works all the time, and interestingly enough, IMHO most things are derivatives of the same things when it comes to trading - chopping and changing to be a perfectionist is pointless - there is only one thing you need to make money - to be long the things that go up, and short those that go down. If you cant accept that then you will have problems.

just watched the videos while I sober up before driving home - long lunch interesting, but really there is nothing new. I have to agree with everything the Dude says above. Plus in the videos...., LBR says it nicely - every business needs to adapt. period. ...the guy who was not even a trader the pit official even he had a good perspective on it. where as that loser (sorry could not think of a better word) who was so anti computers and saying they are evil.....who cares about guys like that he wont even admit that change is here! Ingot - your question - do you want to be a part of it - there is no easy answer, but I would say, if you are competing against (of just feel like you are) then the obvious question is why? You cant beat a computer for speed or discipline, but you can provide context and patience - I am not sure they have taught a computer that yet We were discussing this in my office the other day - there are multiple people trading different styles, everyone has their up and down days, nothing works all the time, but the thing that makes the difference (and this was mentioned in the first videos) is that its not the guys who make the money but those that limit the losses that survive. You dont need to trade every day - as an example- sit back and look, look, look for the one trade/the one pattern/the one idea that will make you $1000 a week. ...get rid of the I need to make money every day mindset......Be prepared to cut it at a $200 loss and get it wrong 5x - ONLY if that opportunity exists - if it does not this week dont trade, whereas next week it may occur three times....... you will only need to get it right once to make money.....worst case you go broke slowly, but if this still looses you money, you will find that you are either not doing your homework, or have a really really bad sense of where opportunities lie.....either change that, or exit this game. Give your self a ten week program....and dont over trade. You dont need to trade all the time. The default position for most traders should be cash - you are not paid to invest a clients money, you are rewarded when you make the most of opportunities when they present themselves.

hi Ingot (I have not seen the video yet) but as an ex floor trader, I think Tams and Traderunner were more pointing out that while the markets have not necessarily changed that much - a chart is a chart is a chart - the edge that floor traders used to have as a part of geopgraphy has changed. It has been eroded. which is why context is always very important. Floor traders could afford to scalp etc as they had an immediate edge of speed, while the algos have this now. Patience and context are vital - why compete against the algos. Some ex floor traders choose not to, some bang their head on the wall, some adapt.

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I kind of have then become confused with what you are talking about here and/or there (as I dont frequent t2w? Our points seem to be the same.... As EW can occur everywhere and it can be seen however we like....for me I dont overcomplicate it as I also dont think there is one EW pattern, but if combined with context and the trend, and I see what I would see as a EW 5 wave pattern in the time frame I am looking at then it helps keep me out of a few poor entries. I dont delve down into trying to perfect the entry - it just keeps me out of some duds.

there are some interesting articles here as well covering various money management ideas Trading newsletter :: The Breakout Bulletin

no...no arguements, but you need to give more info in terms of what you are actually doing and how you define irrelevant portions of returns - what is the benchmark, what is the market - it sounds like you are looking for the proverbial free lunch of risk free arbs, OR are doing the relative strength trade - buying a stock or stocks, hedging with an index to take out the market risk. Are you trying to take out market risk on an individual stock, take out interest rate risk, minimise volatility, do a texas hedge on a portfolio of small caps stocks...etc; etc; There are plenty of hedges out there - but it depends on how your tracking is.