On watch for Feb 18, Wednesday

Tomorrow got plenty of errands to do so I will only look for this one set up, if something is a lay down I will take it ;

1) Daily overextended
2) Gap up open with possible parabolic move up out of the gate
3) Daily resistance level over / under
4) Short first weakness

9 Tickers to watch:
CRIS, ROSG, FXEN, REE, AXN, ONCY, LEI, AVL, for short,
  and maybe PES  for long if pull back to 6.00 level , major swing support now.

PES daily

Salute !

Feb 17 Tuesday Recap ,Using the @Modern_rock Monitor Set Up

I was mainly looking to short the overextend tickers from the watch list of 10 stocks.
First thing I looked  for is which one of all 10 will open with gap. I use 4 to 6 monitors,
which makes this task a walk in a park since no need of flipping screens with charts.
In the past that was my biggest problem. So I watch many tickers for ONE strategy.
Why? ( because @modern_rock does the same )

1. One of the many tickers will probably do what I expect and make my day.
2. It is very relaxing when you look for one particular thing to happen in many different tickers.
3. By watching many tickers laid out I can instantly compare which one is the best mover, so I am not forcing a trade in only one that I'd be normally glued  to,  when using one monitor.

So yes more monitors and good machine is excellent investment , one good trade pays for all !!!

CRIS did literally exactly what I was expecting.
The daily overextended set up, rallied parabolic to 3.40 major daily resistance of the gate,
Stalled, made double tops 3.40 , followed with one lower high.
I didn't feel like shorting the exact 3.40 top, wanted to see more weakness  confirmation,
so I shorted the break below 3.35 , confirmed with Time and Sales prints and was ready to take a smallest loss if did not gave me green position instantly. The drop was dramatic, and covered with 19c gain , 3.15 per plan from yesterday.

CRIS  the plan ( expectation)

CRIS short 3.34

The second attempt was stopped out with 6c loss later in the day after CRIS made NHOD 3.50. made few lower highs . but I missed the right one. Not big deal it was per plan. Will watch tomorrow again CRIS for same set up. ( this is even getting boring making money the same way over and over again )



FNMA long trade was not per plan, it did not pull back to the 2.50 area  as I planned, instead it was strong open, shot up to over 3.10, it dropped, I  tempted to short it, but I stuck to the original plan for long since it just broke out of major daily resistance level 2.50.
The great thing is I did not chase it. 
I waited patiently to have a drop, Later it was gearing up, kept watching how it was making higher lows, (Natan calls them ABCDs and I'm  thankful for his trading tips, I highly recommend his services Investors Undergorunf), strong way above average volume.
At one point I felt like I am missing a great possible move. From my experience , this feeling of "missing a move" is very dangerous. Blew few accts in the past  So I put myself together, watched the time and sales like a hawk, and decided to give it just a few pennies tolerance if I get in long. I longed it at 3.16, had my finger on the trigger to exit immediately if was gonna go against me, asking myself the 2 questions,
It did not trade below 3.16 and was patient with a good trade for nice ride,   to lock in gains at 3.46,
( thanks Nate for the trading tips again)

FNMA long 3.16

FNMA  took profit 3.46

CLF was trade per plan did exactly what I was looking for the entry. Bough long on the drop towrds the 6.80 support at 6.85.

CLF long this pull back  6.85  against 6.80 support

I was anticipating that that 6.85 will hold, however at t he next weakness I bailed out with 1 c loss, having in mind that two things can happen:

1. May drop much lower so Im not gonna suffer red trade if I get out
2. May always re-enter if shows strength in this 6.80, 6.90 range

CLF stopped out with 1 c loss

And it did bounce again from the 6.80 bottom , and I did did re-enter at EOD 6.90 long for swing since the 6.80 was  holding all day from the very first parabolic drop in the AM.

CLF long 6.90  swing

Risk remains below 6.80 level, and will abandon the plan for long swing if I get stopped out tomorrow or so. I am a bit nervous since it didn't make positive close as I really wanted it , but I will take this chance, I think the risk vs reward is acceptable ( may easily go to 8.00)

CLF   daily

If anybody has any ideas , or see that I'm doing something out of line, or think there is better way of doing things please let me know. I like to be criticized, and I am dedicated to trading for a living.

Salute !

My Favorite Short Set Up Learned from @Modern_rock

1) Daily overextended
2) Gap up open with possible parabolic move up out of the gate
3) Daily resistance level over / under
4) Short first weakness

Plenty of stocks are setting up for this set up
Here are few I will be watching:
GENE, CRIS THRX VIP CYBR CYTK GENE WWE OIBR WPRT

I will look for gap up open, exuberant rally and then weaker highs.
I may short directly into a major daily resistance before lower highs are established.
However that is more risky, but the rewards could be excellent, since many times the smart money will unload into the opening spike, after which bottoms fells off, and drop is very quick and dramatic.
But for safer bet, wait for some confirmation of weakness.
It is very simple trade , it is great if you are capable of watching more screens, since it doesn't happen to every overextended stock.
Stops are very tight, having in mind many traders can have the same idea and many can be short, hence  short squeeze can spike the stock much higher then you can think, and you can lose lot more that you can imagine. Keep on mind how much you can lose first !!!
I will take the smallest loss, and will look to re-enter if the conditions are un-changed.

This is how I visualize the plan :

CRIS daily

CRIS intraday 1 min chart

If CRIS openes strong , gap  up, runs to the 3.40 , 3.50 area, I will be shorting the weaker highs.
If I am not instantly in green I will exit and look to re-short.
You may pay and have a stock guru guide you through trading learning curve , but you can save your money and learn from those who like to share free, like @Modern_rock.,

FNMA Long Swing Idea

FNMA broke above major swig resistance 2.50 and closed above. i WOULD NOT CHASE it.
Will Rather wait for pull back to 2.50 or 2.60 area on 1 min , 5 min chart enter on higher lows, possibly with confirmation with higher high(s) on those time frames. I am using Big Charts to illustrate the daily since TOS is showing a bad tick spike.

FNMA daily   

FNMA  hourly 

Keep it simple !
You can only take a loss or take a profit.
There is no third dimension.
So why bother with 100 indicators.
With any indicator you can still lose or make on a trade.
Price action is what I go by.
It may hit my stop if I enter, but will still watch it closely, for re-entry at the simmilar price of my original entry.
I will not try to re-enter at much lower then 2.50.
Remember to go to 3, 4, 5 or more first must go through 2.50, 2.60 and so on.
This is in case it starts dropping below 2.50.
It has to hold 2.50 to confirm me good odds to continue up move.
This chart looks like "Money in the pocket long" but never be so sure.
Plan your exit if it doesn't do what you are expecting.
And if it drops below 2,50, I will not relate on any news or fundamentals "promising a move up".
That is just my opinion and I  prefer this type of rick management based on price action rather then relying on any source of info that may "promise me" up move if drop below 2.50 happens.
Do not lose money is rule number 1
Rule number 2, do not forget rule number one
Warren Buffet
If you make money there will be  nothing to be concern about .
Be concern about losing money .
Salud

CLF possible long play swing

 So Ben my man, good luck on your pick CLF, welcome back to the trading arena LOL. Looks like it may be a good  swing long.  I personalty seldom take swing positions, since  on a good day-trade set up you can make great returns as well you get instant gratification by timing a good entry.

 ( see my 1st post Stocks to trade or 20% gain in a day WPRT). I might actually take CLF long with ya :) 

Great last earnings too. Feb 3rd report beat all the expectations, went to $8.00 in pre-market, pulled back, consolidated in a flag between 6.00 and 6.80 and  on Friday 
traded  above 6.80 break out , so the 6.80 should become support with room to go to 7.5 as first target and 8.00 second near term target.  Solid Risk vs Reward ratio.

Here is daily and 30 min chart.

CLF daily

CLF 1 hr

Just gotta find good entry and I will use 6.80 as risk level. That's me , you know I use stops.If opens with gap up on Tuesday I wont chase it. I will wait  for pull back to drop as much as it can closer to 6.80.  Then I will look  for higher lows on 1 min or 5 min chart maybe confirmed with higher high. On daily I will look for overhead resistance to take profit and buy back again on pull back at better price. Look again higher lows , no chase, no rush. First resistance is 7.50 on daily or  8.00 considering Feb 3rd pre-market topping action Good pick !!! What concerns me a bit  is your plan to keep the stock even if it drops to 5.00 to add more and bail out on rally to 7.00. You called that a "hedge". What's the worst case if it doesn't go to $7 after it falls to $5? If it falls to $5 may fall to $3. Hedge means  " protecting your investment"  Adding to a loser is exposing yourself to more loses, it is not really  a hedging . Learned it the hard way myself. Taking a small loss if drops below 6.80 might be a better idea. But again that's me. A big factor to consider is the time. When trading, time is of essence. If  CLF it drops below 6.80 and then keeps dropping to 5s , it will take time. Your money is in red. Time goes by and you are still in red. When / if / comes down to 5.00 it is no guarantee it may go back to $7 at least not quickly. That's is 40% gain to go back to 7.00. And will take more time. Days or weeks maybe months. Cutting you loss short , below 6.80 , will allow you to use your money for other trades immediately. Cutting small loses also means saving time. And dont forget :Trading is a business. Plan the trade , trade the plan. Salut ! And my plan is this :

Just gotta find good entry and I will use 6.80 as risk level. That's me , you know I use stops.If opens with gap up on Tuesday I wont chase it. I will wait  for pull back to drop as much as it can closer to 6.80.  Then I will look  for higher lows on 1 min or 5 min chart maybe confirmed with higher high. On daily I will look for overhead resistance to take profit and buy back again on pull back at better price. Look again higher lows , no chase, no rush. First resistance is 7.50 on daily or  8.00 considering Feb 3rd pre-market topping action
Good pick !!!

What concerns me a bit  is your plan to keep the stock even if it drops to 5.00 to add more and bail out on rally to 7.00. You called that a "hedge". What's the worst case if it doesn't go to $7 after it falls to $5? If it falls to $5 may fall to $3.
Hedge means  " protecting your investment" 
Adding to a loser is exposing yourself to more loses, it is not really  a hedging . Learned it the hard way myself.
Taking a small loss if drops below 6.80 might be a better idea. But again that's me.

A big factor to consider is the time. When trading, time is of essence. If  CLF it drops below 6.80 and then keeps dropping to 5s , it will take time. Your money is in red. Time goes by and you are still in red. When / if / comes down
to 5.00 it is no guarantee it may go back to $7 at least not quickly. That's is 40% gain to go back to 7.00. And will take more time. Days or weeks maybe months.
Cutting you loss short , below 6.80 , will allow you to use your money for other trades immediately. Cutting small loses also means saving time.

And dont forget :Trading is a business. Plan the trade , trade the plan.
Salut ! And my plan is this : 

CLF 5 min 

BLDP short trade

BLDP set up:
1) Daily overextended
2) Opened gap up towards major daily resistance $3.00
3) Short 3.00 a rounded number.


First I shorted 8th min after the open at 2.87, had a nice 10 cents drop. Then went up at break even.
I asked myself the 2 questions ( from the prev post )2 questions I ask myself when I think to exit
# 1: If I cover at break even am I gonna lose any money ? What is the worst that may happen ?
#2 : If I get out at break even and price starts dropping again, can I re-enter again and still be in the move ?


So I didn't take any profit and covered at break even. Then I didn't want to short again till I see confirmation of lower low. So I waited, and luckily having 6 monitors , and not removing BLDP from the screen, I was able to see it when it approached the 3.00 level, the major daily resistance. I focused on it , patiently waited for a pull up after the drop from 2.99 to 2.92. It pulled up to 2.98 , focused on the Time and Sales prints , and shorted 2.95 with risk 2.98, Worked like a charm.

       BLDP  daily                                                  BLDP  1 min  Short 2.95 stop just above the spike

BLDP   covered most of the short 2.79 left small for swing

pic.twitter.com/XvXSCO1iIt

pic.twitter.com/8iB9suh9xW

Two Questions I Ask Myself When Trading

Thought on why I enter a trade and 2 questions I ask myself:
I see the price action, a chart, Time n Sales, indicating a possible move downwards. I am timing the entry and I click the short button fairly QUICKLY when I have the conviction the price will go in my expected direction, anticipating the momentum. Next thing is I see the prints are above my entry. What I expected to happen did not happen. It happen the opposite. I give it a few moments to see if price may drop , see the prints, and if it is not happening I ask myself 2 questions:
1) What is the worst that may happen if I close the position right now , right after I entered ,right after I thought the price will go my way, but it actually went few ticks up? Am I gonna lose money? The answer is : No , Im not gonna lose , except few pennies and commissions , which is dismissal comparing if price goes much further in the opposite direction. 

2) What can I do if I exit , and price starts going in the direction I expected? Can I reenter again?
Having in mind that the stocks I chose to trade are big movers, the choppiness in general is and should be minimal. Momentum stocks are those with 2 or 3 times higher volume then on average trading day. This is why I do not trade indexes like SPY QQQ DIA IWM e.c.t.
Knowing the first answer in the first question which is : No I will not lose money if i exit, and knowing the 2nd answer that Yes I can re-enter again, is a powerful mindset for cutting losses short. Thinking that your losing position may turn around in your favor is extremely dangerous though. Your mind will always find a reason to stay in losing trade such as : "ok it is up to the next resistance it may bounce here" , then the next thing you see it went up the next even higher esistance , and you say to yourself " ok here is the top , now will start dropping" and before you know your tiny losing trade that you could have exited right-away when it didnt do what you expected ( you entered and click the short button QUICKLY so you catch the momentum , so you wouldn't miss the momentum but it went opposite of your expectation ) becomes a big loser. Besides losing your money, now you have a unclear mind embedded with emotions that will make you do the next stupid thing , which is entering ASAP in the next trade trying to immediately recover your loss, and suffering another loss .

To recap:you have a good reason to enter a trade, which is your expectation for the momentum move. If the move is totally the opposite of what you expected , ask yourself the question No1 and No2 . Answer the questions. Taking the loss will be much easier then thinking and hoping the trade will turn around in you favor.
The second question when asked, engraves in your mind the fact that you can re-enter the same trade again if moves in expected direction. When  you don't ask yourself you will just remain focused on the stop loss that got hit , and you will forget the option of re-entering .
So when trading it might be a good idea to be interviewing yourself and to stay calm.