Red Day taking some beating from EXPE

EXPE 

Now this is great "good losing trade"  to elaborate
It might get confusing why I took short when it opened above the PDC above the 20 SMA and the 200 SMA.
The markets have been running with gaps ( SPY) 3 days in a row. EXPE  had  gap up with enough distance to travel back to 20 sma which would just made my day . As I twitted,  the ideal entry was narrow 2 min opening candle and short at the break below with  risk above it.
The opening candle was not broken below.
The second candle had a nice wick rejecting the 110 level round number. Those were  my short entries lows 109s and high 108s.  The main level to watch was the daily pivot 109.17 area from Jan 22. weather will hold or not

EXPE shorting the wick 2 min bar

Since this was  the 3rd day SPY gaping up,  going LONG on such occasion for me is not the best option  because more often I lost my shirt doing that rather then making any consistent gains on such chasing longs.
It went back up above 109.17 and my reference  point for risk was HOD so I built some more shorts towards the HOD with mental stop above it.

EXPE avg 109.50

The 2 min red candle hit the HOD but I needed a confirmation to cover and take the loss. 

Having the entire plan ahead of time is crucial so  I have something to follow  and execute without thinking 

The plan for exit: The next  2 min candle could  break below it, which would keep me short with target LOD and avg short 109.50s, However it broke the high and I covered. On some rare occasions I may flip the trade long, but just because the market has been already overextend  I obey my rule not to chase it.  Stopping out was the right thing to do, and this trade goes in the book of  "GOOD LOSING TRADES"

Had it gone to LOD or even lower,  a gain of  $2,000 to $3,000 winner was gonna give me a nice Green Day  and would have made many "followers happy" reading about it. However it is just amazing how all my post about Red Days  are visited 4  times less then the ones titled "Green Day". No wander 90% of traders lose money  :) 

It is amazing how many people are more excited on wining trades rather then losing, with no understanding that once you are in a  winning trade there is really NOTHING you can do, you may take more or less profit or so...  Trading is all about what you do when you lose,  how you take your loses, weather you take your loses or get stubborn,  and what you do right after you take a  loss. 

Here is what EXPE did after I cut my loss:

EXPE the good losing trade 2 min chart

EXPE eod  5 min chart 

Note the pivot 109.17 with double bottom and narrow 5 min candle taken out for long trade but it was just not for me 

Salute 

@DaChopa

My Favorite Short Set Up

LVS
I'd rather write a post for a losing trade(s) then a winner, but ...there hasn't been any lately ..

LVS was one of my favorite short set ups , explained many times in this blog.  LVS was my choice over WYNN simply because the spread was much better.
I took more aggressive entry here throwing offers all over 45.00 a whole number , which  is major daily resistance after 2  day run from below $40.  For a novice I'd suggest to wait for 2 min candle break of the low and stop above it. Scale down 1:1 risk reward and cover rest at first 2 min high break out or at the support 44.00 which is almost 1:3 R:R. Seeing it at 44 is no brainier COVER simply because it is PDC and previous day congestion area acting as strong support.

LVS  2 min fluid candles from the open 

I explained in this previous post CLICK HERE how more often then not , the first half hour gives me less choppiness and nice fluid moves on 2 min candles 

Later in the day I tend to use 5 min and 15 min charts
This is COF 15 min chart that did not trigger short entry, since the 15 min candle low was not violated

COF 15min  no trigger short 

COF why bother guessing when can read and act upon price action ?!?

And here is the violation of the first 15 min candle low for nice R;R of 1: 2

COF 15 min 

Salute 

@DaChopa

My Favorite Long Set Up UWTI

UWTI 

I always try my best to start writing my trading journal as soon as the trade starts. It just reconfirms the confidence and the reason for the trade. 

UWTI 5 min (note the volume  !!!)

UWTI
The bold lines is what I posted in the AM soon after I entered the first long.
A picture perfect technical  great risk long trade
The 5 min chart shows for the first time in many days UWTI opened above the 200 SMA, the 20 sma the PDC and PDH with some gap up. Very bullish sign with 1.30 risk tolerance.. This is same set up as shorting a daily overextended stock explained in some previous posts.  I like the short much better , but this long on such massive volume was a no-brainier for me seeing /CLH6 (crude oil futures) doing what was doing.  I explained it to one of my "challenge students" on Wednesday  who  banked on Thursday shorting TSN, while  I was off  due to some circumstances.
At the open I watch mostly 2 min chart because the volatility tends to be the highest. Sometimes on high priced stock even 1 min bars can be powerful. Playing just the break outs of the 2 min candles in the first half hour many times more often then not, is quite all right for me  because of the great follow-through from one candle to another. I prayed that it will not break out but it did.
Why?
My plan was  simple:
 "If it breaks I'd have to go long, no doubts here, because the gap was not that big  and it may never come back...but there is also great chance of failure of the break and it may pull back and fill the gap to some point , maybe half of the gap maybe less maybe entire gap, who knows ?!? That I never know. I wanted  it to break  the  2 min low and fill the gap and then LOAD UP SIZE with tight risk, rather then just buy small size at the 2 min break out and see it grinding all day higher with midget size and make few bucks for  peanuts. I would simply not go big at the 2 min break out because I did not want to play with stop, and if filled the gap I would have very hard time to load up size. even on this $1 ticker. If the  open  was right at the PDC, PDH at the 200 sma then I would have loaded big right then and there, with 1.30 risk"

So what happen today ?

UWTI the initial entry small size with idea to build all the way down to 1.30

It broke the 2 min high open, so I had to NOT THINK and ignored all my  buddies sending me messages  telling me to be careful caus' the news were saying something about some deal  or whatever the talking heads were  giving their analyses and their opinions about the oil past few days or weeks or so.  Like I said in my prev post CLICK HERE , I already have MYSELF  100 opinions  and analyses that we bull shit about with my buddies every day,.. about the oil specially...My trading is about ignoring MY 100 OPINIONS that do me no good and sabotaging my trading so  I ONLY read the price action!

As twitted here I went long with plan and expectation to pull back and load more size at lower levels
It happen exactly that , failed the 2 min break out which in no way I would be short , and I wold not use stop below the 2 min low simply because opening above the 200 sma 20 sma , above PDH, PDC after 5 down days on such massive volume, shows pure power for long.
Then the drooping begun candle by candle. Each candle had  lower highs  without breaking the previous candle high on which I was waiting to  add more long. So I waited and watched the time and sales and  L2.
When it dropped below 1.35 it  was a  "leap of faith moment" or experience of many years of trial and error. I had thrown bunch of smaller orders below 1.35 all the way to 1.29, and waited to see how they get filled and how many will  get  filled  at those placed  bids. It was great seeing somebody's else's sizes of 450,000, 200,000 shares and  so on getting filled along with mine "dwarf" orders without any further down move follow through, and there were no fills on my orders  at or   below 1.33.
So what does that tell me ? I WAS NOT  THERE ALONE BIDDING BY MYSELF ! 
What a relief ! It was like being in a room with all the sharks , and listening to them what they are doing !
Another thing that also comes with experience of painful losing for many many years : Knowing that I will lose per plan about $3,000  if dropped below $1.30 ( you go figure now my size ) is way better then losing lot more money doing dumb stupid  trading in the past. I have lost $7,000 in a day by chasing , revenging, by trying to break a support level THAT I WAS THINKING it HAS TO BE BROKEN because the "TV" said there will be more downside.. which happen to me so many times and I've blown so many accounts in the past. Many many many times I would use huge size to  REVENGE TRADE with no set up , but just doing stupid  EMOTIONAL TRADING because I had just a small legitimate loser and I wanted my money back RIGHT AWAY. This is when the experience ( of pain and suffering ) comes in handy: "If I was revenging from stupidity using size so many times, why not use size once in a while when REAL OPPORTUNITY PRESENTS? I was pissed enough losing lot of money from revenge trading, so at least if I lose a lot per PLANNED TRADING I should  not be pissed off after so many years in this game "

UWTI the leap of faith bidding towards 1.30 

Then the stronger relief came in , seeing  finally the first 2 min candle high  break, which was

 NO THINKING NO HESITATING  ADD  more long

UWTI adding long 

Then I re-focused on the 5 min chart and woow : look at the clarity and confidence I got 

UWTI the magic set up triggering on 5 min and loading MORE

I have seen this set up  many times, done it  many times with small size , I have tweeted this set up quite often too,  I wrote blogs about it too among many others set ups. So what is there to think? How many barrels oil of supply and demand is in the world? Production cost ? Is OPEK gonna cut production or not? Or I should think of  Cup and handle? Trying to find  and define a perfect ABCD break out? Head and shoulders? Triangles of many kinds? Bollinger bands that u can draw from many different highs and lows?   he he he  

So I loaded up  BIG.  At this point I was not even thinking about losing. which is kinda wrong too,  but hey, having in mind all of the above said and explained , the odds were clearly in my favor here.

Did the High Wire Walker think of death when he was  walking on a wire between the twin towers in 1975 ? BTW must watch  that movie, so inspiring: "THE WALK" ..it is about doing what you love and not fearing from death. Amazing  true story. I felt the same when I first step foot inside the outcry pit at the NYME, It was the outcry oil trading pit many years ago where  I was  just stunned, and deep in my heart I knew what I love to do. Many years after went by filled with lot of pain of losing 

So what did I see precisely: 

3 to 5 or more consecutive bars with lower highs of each bar dropping into :

1) PDC ( precisely defined level, no argument no debating no thinking )

2) PDH ( precisely defined level, just reading price no guessing )

3) Above 200 sma ( nobody can deny it or modify it ) 

4) Golden cross /when 20 sma crosses the 200 sma / rising 20 SMA on 5 min 

5) Massive volume higher then any time  before any recent previous days 

It was trade by summary judgement; LONG !

Could I go short at the 2 min break down? SURE ! But if went up again above 2 min and flipped to long again taking a second loss, and then broke down below AGAIN, taking a third loss by the time it finally sets up the REAL GREAT LONG , I'd be mentally and financially exhausted and would not take the best entry.

ALL PRECISELY DEFINED ITEMS that nobody can deny or argue about.

Now those are things that I use that help me to read the price action. Anybody can find different things and guidelines to go by as long as they are precised,  not argumentable,  easy to recognize and to follow. There is never a guarantee that something will always work  forever, but longer you are in the game more you will learn and recognize. And to stay longer , knowing you will most likely keep losing you need to figure what is your comfortable  risk .

Focusing  to 5 min chart with candle by candle higher lows unloading into the highs of the third candle closing most at brake of the last candle's low.

I did few more trades afterwards too, but much smaller size looking at 15 min 5  min and 2 min trying to see if this thing may go much higher.  

Like I said many times , I can trade every day till end of this year and still wont be able to explain all trading set ups and strategies ....simply because I was trading / pardon losing many years,  losing my shirt off and learning from many loses. 

One thing  I do say and believe in : try to master ONE SET UP by DOING ONE SET UP  many months , and in case you happen to be  consistently green , then you may have some chance to progress. I am not saying  this because you are stupid, I am saying this because most of wanna be traders are extremely smart people who realized working a clock in job that they hate , will get 'em nowhere. It takes open mind and high intelligence to realize that. But the high IQ the cleverness, the open mind,  the great intelligence unfortunately is our enemy in trading. You don't wanna think during / in the middle of  your trade. You don't wanna analyse when  you are already in the trade. Because when you think you are admitting yourself that you DO NOT KNOW something. Thinking helps resolve  problems.  If you think where oil will go in the next ONE hour, or next month based on the DATA and ANALYSES that flood the media, if you try to solve that problem,  you will be right as many times as any moron will be right,  because both of you will be 50 /50 right or wrong.

Reading the CURRENT PRICE action NOW is what can  make you a successful day trader IMHO
I'm giving you all this free because not many  will do so,  and because I know the pain many of you go through losing  your money, your time,  your friends and family members who give up on you. You may think you are stupid , but you are not. We as humans are created to solve problems, to progress, to think to develop. We all want to think and based on our thinking we want to guess the price movement. By thinking we create a picture how our stock has to perform. The worst thing is some  times we are right just  like a broken clock, and we tend to  memorize those few times rather then those many other times when we were wrong. Why people love casinos? Because they win few times .. "it is so easy to win "  LOL

So don't feel bad if you are losing, Nothing is wrong with you. It takes lot of practice to master something. And if you happen to have a lot of money don't think that you will win this game just because you have a lot of money by blindly adding,  averaging and all that stuff.. Soon or later you  will lose it all. Having s lot of money can not make you a great guitar player if you do not spend months of practice. or tennis player ..or anything else.

Many people ask me to tutor them,  to open chat room  and all that stuff , but I do not want to have such burden of responsibility to be always available and to have to answer questions to subscribers.... I like to party sometimes just spontaneously out of the blue, or go on trip, or do what ever I wanna  do when ever I wanna do. That would be not fair if I accept subscriber's money.
After all, isn't the freedom what the treading  is all about ???

Salute
@DaChopa

AKAM green day in less then 40 min turned into struggle and miss on CMA and AKAM

AKAM

but after I continued trading 

Took peanuts on CMA and clsoed RMD with small loss right before it dived 

CMA ah well 

RMD ehhhhh 

AKAM

Gaped above major daily, weekly resistance which became support with  very little resistance above on huge vol. Although it can be great short later in the day the momentum first hour was was long.
I could have tried to stay long longer but the reason I decided not to were the talking heads who may cause to move the markets in crazy manner

AKAM

The trigger was the break above the inside 2 min candle at major breaking level the HOD with risk below the same inside candle 

FB 

Made  pull back into the rising 20 sma on 2 min trigger entry long was the break above the 2 min candle stop below got stopped out per plan.

FB the plan 

FB good trade stopped per plan 

Hope you all have green day too

Salute 

@Da Chopa

"Cornering a "Stock" when trading on a busy info day

It will be one of those "talking heads" days when 'd rather take day off 
10:00 AM Yellen (EST) 10:30 AM EIA Petroleum Status Report 1:00 PM 10-Yr Note Auction 1:30 PM John Williams Speaks 2:00 PM Treasury Budget

it could be a very choppy day so building and scalping is what I may do mostly instead of directional load ups.
This is a strategy for trading a BB stock  in which there is an equation  with one very known fact: the ATR.
When a choppiness dominates , a regular big board stock moves through the ATR in a very choppy, up and down manner. If you are familiar with few stocks that tend to chop  more, rather then to trend, this could be quite nice way to make few bucks. The reality is in the markets there is more choppiness then trending over all, stocks tend to trend 30% of the time and be in range 70% of the time over all. So finding a choppy stock should not be an issue, just make sure there is good volume and tight spread.

There is no ideal set in stone way to trade , but the majority of traders are looking to catch a move, to squeeze every single penny out of it , to hit  home runs. So  majority of traders loose, or about 90% or so? It is normal to want that , we are humans and we want it our ways. I belong in that group  but I try real hard to fit in the reality.

I normally divide the ATR by 10 and generally build position each 1/10th of the ATR going on the way   against me, and constantly placing /replacing orders to take profit at 1/10th of an ATR. 

May update this post with some trades if I do any today or in the near future if anybody wants to know more detail about this quite relaxing way of trading using appropriate money management. I kinda like to call it "Cornering a stock " which in reality is not a true cornering since I am not Warren Buffet with unlimited funds to actually do that , but it appears that it looks like that.

Most importantly I do not do this longing stock. Or if I do I have a very well known stop since when long many things can go wrong with stock.

Happy trading and be careful when the talking head are on today 

@DaChopa

Green day ABX RIG FB

Why bother using all those sophisticated scanners ..I used to use 'em ALL..TC 2000,  Trade Ideas , u name it, I did it ...I had  hundreds of formulated set ups I programmed  'em my self  ..LOL  Fun to do but waste of time. Any daily overextended big board in one or the other direction is trad-able opportunity after all... as long as it has nice spread and good liquidity.

Now I try  stick to few symbols over 5  monitors , and watch and chill like in a movie theater ...or sports book
Like NKE ABX FB SSO AAPL and what ever opens nice from my watch list is basically the same thing , just need some patience, clear mind and less thinking. Nice music or yoga on you tube ( females of course )  do me good enough

NKE lets see how this will go 

I was looking for NKE to give a nice pull back but it did not, it just kept moving higher and I did not want to chase it. 

NKE no pull back towards the 20 sma 

ABX was the other I was stalking  and it did what was expected 

ABX per plan,  nicely  overextended on daily, om intra-day  rejected the 200 SMA on 2 min 

covered  some at PDC and some more below

Then re-shorted again the pop and if I made over $1000  I'd  be done for the day , but "had to make the rest" on FB and of course got chopped  up rushing into choppiness just trying  to get the day over so I can have a coffee  with my buddy  ..story of my life..  ah well some things will never change  no matter how much I write about it.

Sure enough the good set up came in on FB later on but "Yes it is my buddy's fault" distracting me  for that darn coffee so wasn't in it to win it 

Here it is   FB 3 to 4 bars pull up into the declining 20 SMA, after nice lower highs oveer and oveer again almost every day , 1:3 R:R,... just do this and you golden.

FB 

But hey cant complain over all  with some green on RIG that  I even managed to alert it on twitter click here and I'm grateful for the green day without any heavy lifting and any stressful swings at all ...nice and  smooth trading day.

RIG

It would have been nice if was moving up candle by candle as it was moving down but hey it did not happen.

Salute 

@DaChopa 

Easy green day ABX short

As proven over and over again the first hour of trading has been the most effective time for me as day trader.

 I know many other will agree for a simple reason: I have lost sooo many times everything I made in the first  hour and a lot more towards the end of the day. It is the opening hour when trading is smooth, has nice momentum and direction for quite good portion of the stock's ATR. And this is how  a good day turns into a bad day; The pace that I make the gains in the open is so quick, and looks so easy ( speaking  for myself) . My mind tends to think : "OK this is great I can do this all day long... if I made $500 in 15 min I can make $5,000 till end of day" ...just to see it losing the morning gains, and then the emotions kick in big time thinking: "... daaamn I was up $500 so easily , let me just make the $500 back and I will call it a day ..."  Next thing I see  I am down some more since the momentum disappears, choppiness takes over  and I tend to "create" set ups ..more  I lose more frustrated  I get, more stupid trades I do. and I lose even more.
ABX
I saw ABX gaping in the PM. I know ABX is big cap stock, but in case if I am not sure, when I trade cheaper stocks I always check the FLOAT on yahoo finance looking at THE KEY STATISTICS so I can avoid any situations like KBIO  recently,  when many traders blew up their accounts. Not because I  do not know how to get stooped out, but it takes very little to start believe that the stock "MUST COME DOWN " and even the greatest trading minds can break their rules and blow up big time. If I disobey my stop on ABX while shorting it,  the worst that can happen it may go against me 1 or 2 ATRs  but not 10 20 or 30 ATRS like KBIO did ..So I will still be OK even if I do a stupid mistake being stubborn and keep shorting it and covering the dips all day long while it goes up against me. I will lose but will not blow up. PROTECTING MY ACCT IS #1 PRIORITY knowing myself I can do very stupid decisions no matter how UP  I AM FOR THE WEEK or for THE MONTH.
To conclude this last paragraph: I like to trade large cap stocks like ABX,  FB,  AAPL,  TSLA,  HD,  ect. to protect myself from blow up even if I do a very dumb mistake. You wanna trade penny stocks? Go ahead but make sure you obey your stops, obey  your rules and all your trading principals, and know that even the greatest traders sometimes tend to disobey and break them all. Blowing acct is bad, but losing your life over it is really really bad  ..Look what happen to Jesse Livermore. If the greatest traders of all times lost it all , then who I am to stand chance not lose it all?
When I trade I know I may lose everything at any time. If you are novice I think the odds to break your rules are much greater. Been there.. done that... many times ...over and over again. Know yourself who you are  first and foremost, because your are your own biggest enemy when  risking your own money,

ABX Today's intra-day  opening price action . being above the raising 20 and 200 SMA  shows clear long bias set up IF IT WAS coming out of DAILY BREAK OUT channel  or  if it had several ( 3 to 5 ) consecutive days downtrend.

However ABX daily showed strong uptrend many green daily bars up trend , and opening with gap up. I would never go long  in this situation, not because it will not go higher, but simply that is my rule that I obey. I lost enough chasing high fliers in the past. The plan was to short the first 2 min break down. It did not break down, it did break on the upside. NO LONG for me here. Second 2 min bar was a wick and I started shorting at the end of the 4 min from the open, seeing the wick of the second 2 min candle. (usually means rejection of higher prices ). I wanted to add more short  if low of the wick 2 min candle was broken.

ABX first initial short 12.02

It did not break, but went higher and broke the high. Here I did not use stop, but if it was a LOW FLOAT STOCK like KBIO  I would  most definitely use  stop before it sky rockets several ATRs against me. With ABX  a $1 billion float stock,  the odds for that are very very small so seeing it going against me was not a big mental issue.
Now comes reading the price action , at which most people ( fundamental investors,  laugh at ) .
Price moves higher but I am not adding any shorts since I see no daily resistance near by. But I know at one point there will be an exhaustion it can not go up forever , not 1 billion float stock. It can go parabolic up yes, but I know the ATR I know the stock, I know how much it can surprise me so I am ready for the worst. At on point I see another 2 min wick candle but now I wait for it to be broken to really load up size

ABX waiting to break the 2 min wick candle

And here is the second entry :

ABX the load up short target LOW OD DAY 1:3 risk reward but in this case that was not too important because I was ready to keep shorting even if it went higher. 

But for novice a stop above HOD would be essential, specially if under-capitalized. 

Somebody asked me how do I get in such position? Hit the bid? Or sell at ask? Market order ? Limit order?

In these situations when I have to get in quickly  on a break , I hit limit order BELOW the BID price. I do take liquidity out and pay highest commissions /fees, but I do get filled at the best price. After I am in, I layer the exit orders at below the market adding liquidity and getting paid rebates. Target 1:1  1:2   1:3 if you know what I mean.

ABX covers layered out at bid below the market

The second round of shorting came in after the break of the low of this green 2 min candle.

ABX recycling

Somebody asked me how and why I shorted , there was no clear set up. Like I said in my prev post, I can trade each day till the end of the year different ways and still will not be enough to explain it all. But to be consistent green I think all I need is just one or two solid set ups. With time, by mastering one set up at a time with small size, exercising extreme patience there is a chance to become better trader. 

Using simple "candle bar reading" helps me a lot. Reading pure price action eliminates the need for "thinking" hence  using my own mind for "opinions" becomes absolute. Now If I am trying so hard to ignore my own mind, do you think I would listen to the opinions on TV ? CNBC, Cramer , and all the entire financial gurus? 

ABX the second round of covering 

The circled arrows are orders placed but never got filled, since price did not drop there. 

ABX covered all recycled trades made more cents then the range the stock made 

I will comment on the COST,  a trade I did not take but saw it clearly and hesitated to get long since I promised myself not to trade today any more. 

Look at this pure price action , nice and clean with exact calculated risk based on candle reading:

1) 143.25 intra-day pivot, 

2) conforming with the 200 sma on 5 min ,

3)  inside red candle with low at the same pivot, 

4) rising 20 sma.

Four major confluent factors, all technical no guessing, no opinions,  just reading price action 

I know it is in hindsight now but I did see it and it is worth mentioning it .

COST

Entry would be break above inside red candle, risking below the candle's low.

If only trailed the exit at the next break of the low of the 5 min candle the gains would have been monstrous. Of course Id lock in gains , but even if left small tiny position with trailing exit candle by candle low, the gains would be fantastic comparing to any risk.

COST

Here is the break I twitted red to green, the green line is PDC ( Prev Day Close) at 144.00 rounded number.

The entry long above the inside candle with risk below, and baaaam freight train in action.

COST   end of day 

It was fun writing this, and will be more fun reading it this weekend, the best trading book: my own trading journal. Enjoy it,  and  if you  find it interesting drop a comment

Happy trading 

@DaChopa

I may start  posting  swing trading positions, it s kind of boring but if enough people are interested drop a comment and let me know.