Swing Positions Update

It amuses me how majority of the crowds is always looking for stocks that will outperform the market and hope to nail some home runs or super novas. While it is true that there are always such longer term investments that will run to the moon, in my experience of many years of trading prior to my success, I experienced  nothing but losses. It seems like that is the case with 92% of the traders, as the statistics say only 8 % actually make consistently money from trading the markets. To make long story short, in my experience it is much easier to find tons of stocks that will not outperform the markets rather then those few that hopefully  may give the "dream come true" performance. So is the reason why  I have the best results shoring stocks even when the markets are at historic highs.This particularly works for me  on intra-day scalping  for nice gains to the do downside, besides the short term swing trades that usually take few days to few weeks.

How to Scan for Stocks

This may help some  new traders who have been asking me how to find good movers. However learning this , is not a guarantee that money will be made easily from trading. It takes extreme discipline to consistently do the right thing.

To understand the concept of finding a good moving stock lets look at few charts in hindsight first.
What is common for all these movers: The strong above average volume. The volume is fuel to move the stock just as more fuel is needed to move the car over the hill.
Fact is any stock that has nice intraday move could be tradeable,( speaking of daytrading)  such as for instance a stock that has ATR of $1 or bigger. It can be nice directional move or it can be choppy. To make money in directional-momentum move seems to be easier , although making profitable trades in choppy stocks is also possible by implementing tactics which requires different approach ( almost 180 degree opposite approach of the trading the momentum directional move )

The factor here is THE RELATIVE VOLUME. The relative volume scan is available almost on any scanner:  TC 2000,  Finviz,,  Trade Ideas and so on.  Besides that, The variable ( in this case the number 3 )  shows how many times is the current volume at the current moment higher then the average volume that symbol normally trades for the past 30 or 90 days. Each scanner is little  e bit different, with some  you can define it yourself, and some are pretty much fixed on the last 30 days. The bigger the number  is the bigger the relative volume is at the current moment. I look to have at least few hundred thousand shares traded in the first few minutes, or in the premarket, For example: there may be a stock that average volume is only 50,000 per day. Today may trade at 500,000 shares all day which is 10 x the average volume. This stock will not satisfy my criteria to trade it simply because it still has very low liquidity for the day. So I need to have at least couple of hundred thousand shares traded the first few minutes so I can actualy have enough liquidity to trade large size in and out quickly.   So I set the scan like this:

It is simple and clean. Now it is all up to which stock  I select to trade. Quick view of their daily chart helps a lot in finding a stock with the least resistance above ( if long ) or below ( if short )

You can either scroll by hoovering above the symbols or click chart view which will display all daily charts. 

From here it is all about focusing on only few, the ones that you may think are the best,  since trading everything is not easy at least not easy for  me. I'd rather stalk my symbols for the day then jump on many new ones just because I had to take some losses. Weather I will just get in and trail the stop as the stock moves or I sell the pops and buy the dips , it all depends  on how the stock is trading. I love to only trail the stops below. but there are I think more cycles when it is better to sell the pops and re-buy the dips.

Hope this may help.

Have a happy trading

AngelDan@DaChopa

New Trader Exercise WHY WANTING TO LOSE

Probably one of the biggest challenge a new rookie trader has to face is ACCEPTING TO BE WRONG and CUTTING THE LOSES SHORT.

It is easier said then done which is very natural and normal for any human being. To easily admit to be wrong and instantly reacting on it, is simply not built into the human nature, period. So if you are a new trader, and you are struggling to make any money because you are not consistent with obeying your stop losses, do not feel bad. It is very normal and very human.
Developing a discipline to admit that you are wrong and acting upon it, is not a skill you can obtain over night because you just decided to quit  your job and became professional trader. Learning or defining certain rules to trade is the easiest part. Anybody can learn it by reading few books or even by just reading my blog. But why not everybody can make money trading? And why not everybody can simply decide to obey the stop loses and became successful trader instantly?

Learning is the easy part, but becoming successful trader is all about practicing what you learned by doing it over and over again by implementing a extremely high level of disciple. I am referring to such level that is equal to a professional athlete who keeps practicing constantly even at his pick performance.

How do you practice discipline? It is  extremely difficult specially if you have no pointers which direction to take. Do you just decide  and say: "OK I will be disciplined from tomorrow" and expect the magic to just happen...  LOL 

Here is one pointer that may help a struggling trader. I heard it long time ago from a master trader who shared this with me so I share now with you:
THIS IS A DRILL ON HOW TO LEARN TO EXECUTE those darn stop losses that you always plan to take but when the stock gets there you just simply change your entire plan and do something totally different, or stupid, which  one day will cost you your whole acct.... if it hasn't happen yet it will happen guaranteed and you can take this to the bank. 


Let's assume that you know to pick good entries,  the easy part that everybody can learn quite quickly anyway.. 
For  ONE WEEK YOU MUST IGNORE ANY THOUGHTS OR NEEDS OF MAKING MONEY ! 
Instead of focusing on "HOW MUCH I CAN MAKE" you will focus on:
 "I WANT MY STOP TO BE HIT ASAP AND I CAN'T WAIT TO EXECUTE IT"
And every time you execute your stop you will give yourself  one reward point. Your goal is to accumulate as many award points as possible by the end of the week. 20 would be a great number to achieve. However you must collect 20 points by consistently obeying all stops. If you disobey ONE STOP even if the price afterwards goes in your favor YOU FAILED ! Start from zero again. Remember: doing 20 in a row is of essence for a reason. The winning trades in between are just winners and you do not count them.   I know it sounds scary on a first thought right?  Wanting to lose on purpose? How crazy this is? Why would I want to lose on purpose??

BY FOCUSING ON THE:
"I WANT MY STOP TO GET HIT !!! "  You WILL NOT ACTUALLY MOVE THE STOCK TO HIT YOUR STOP!!! You ARE NOT ABLE TO MOVE THE STOCK ANYWHERE!!!! Regardless of what you think, what you want , what you wish , what you think you can predict, or what you actually do, the stock price will move UP or DOWN  and there is absolutely NOTHING you can do to change that. ( Unless you are Martin Shkreli and buy the entire float and move the price from $3 to $54 in one day ) 


By focusing  on "I WANT MY STOP TO GET HIT !!! "  you will ONLY MAKE SURE THAT IF THE STOCK GETS THERE YOU WILL 100% execute your stop simply because you set your mind to WANT TO DO THAT , and you will protect your acct  from potential blow off. 

 After completing this exercise SUCCESSFULLY  you will never be the bad old trader you always was: THE STOP LOSS DISOBEYING GARBAGE TRADER .

Now get this question  into your mind : ":Do  you really think  that after you enter a trade just by WANTING TO LOSE ; THE STOCK WILL ACTUALLY HIT your STOP???
How often when you entered your trade,  you WANTED TO BE A WINNER but it just went totally against you? How often it went to your planned stop loss area that you did not want to happen? And how easy was it for you to execute that stop loss that you DID NOT WANT TO HAPPEN?
This is very serious mental game no joking !
YOU HAVE TO WANT TO HIT YOUR LOSS SO YOU CAN EASILY EXECUTE IT RIGHT THERE WHEN or IF the price gets there.


If you DON'T WANT YOUR STOP LOSS TO BE HIT , and the stock goes there , DO YOU THINK YOU WILL BE ABLE AND YOU WILL WANT TO EXECUTE SOMETHING THAT YOU DID NOT WANT TO HAPPEN IN THE FIRST PLACE ???

It is extremely hard to execute something that in first place you DID NOT WANT TO HAPPEN !!!  Do you agree now?

SO YOU MUST LEARN TO WANT THE BAD THING TO HAPPEN SO YOU CAN EXECUTE  your plan WITHOUT ANY SECOND THOUGHTS when it happens !!! Ok?

This is the $1,000,000 post that  you may want to save print and read every morning before market opens.   

Try for  ONE WEEK to IGNORE ANY THOUGHTS OR NEEDS OF MAKING MONEY!! 
Limit your size accordingly to the amount you "WANT TO LOSE" comfortably AND LETS SEE WHAT HAPPENS. Again, this is assuming that you already know what are good probable entries where you have an edge. 

Happy Trading and if you want to drop a line how did this exercise go,  that will be great to see .

AngelDan@DaChopa

CLF retro from the post made in 2015

CLF

A buddy of mine hit a nice swing home run on CLF. Up 25 % in profits

If you are not sure what to do and you are in a nice profitable trade , check or even better  ASK the price action for an answer  : this is the simplest explanation and it works for me

• HIGHER LOWS 
• HIGHER HIGHS 
• --------------------------  OR ?
• LOWER LOWS
• LOWER  HIGHS

Click on the pick from your PC to magnify and use arrow keys to move to next pick
CLF is big % mover so looking at intra-day action is important since big  % gains / losses may occur withing a single day.

 

CLF

CLF

CLF

CLF

CLF

CLF area where it shall not go to stay long and strong

CLF where will it go from here ?

CLF 

If a trader happen to exit long position at 3.10 lower low, for establishing re-entry may help figuring out the next higher low higher high with risk below.  Fundamentals can be great but stock may drop lower before it gets higher. Why? Well, if fundamentals are great , the big boys would like to load up on lower prices, they will probably NOT CHASE the highs buying the  break outs, rather will be buying into the pull backs.

CLF right now is trending stock with very clear price action 

This happens with the markets 30 % of the time 

The other 70% of the time markets are choppy and non directional 

While 90 % of traders look for the directional trades ONLY , the 90 % of the traders ( or more ) lose money.

Stock will always make pull backs

If it makes new high I would not chase, I would  wait for the pull back , make sure the pull back is establishing higher low, and re-enter 

If you do not take some profits after great 25% move up in gains, and let it go back in negative , you will eat your hart out

It is just my opinion , been there done that , felt a lot of pain 

This is the post from March 2015 about CLF click here

Salute 

@Da Chopa

Trading Big Boards Concept Simplified $AAPL $ABX

I alerted  long ABX here and long AAPL here  for a reason.
Preceding to those alerts,  I mentioned about the SPY futures ( E-mini) very early pre market  alerted here. SPY futures  were testing very important daily pivot level above the 50sma, with  pin bar test and  held the 50 sma,  well and above the 20 sma, quite a  bullish environment on short term outlook.

Few reasons why I like the big boards over the penny stocks :
1) Extremely huge average volume meaning  very liquid to trade any size I want, any time,  any day and almost any BB stock. ( that's why I don't bother much with scanning and finding the perfect Holly Grail Stock to trade)
2) Quite easier to see and predict the general bias based on few very simple technical parameters mentioned many time in my prior blog posts.

I will  repeat them today again, since I know the pain and suffering many new traders go through. Been there done it all and I know how it hurts.


Why ABX long?
Look at the charts:  Daily,  5 min ,  and 2 min

ABX I alerted it before this was created

ABX the trigger for long

ABX explained 

Why AAPL long ?
Same reasons as ABX

AAPL the long as alerted

AAPL

Today I traded my buddy's acct who was begging me to show him how it is done and who always wanted to make $2,000 per day  with $30,000 acct and $120,000 Buying Power. ( so there are other trades in the PnL tiny scalps but they DO  ADD at the end of the day ) .  BTW he lost over $10, 000 trying to do so in a very short time.  

Is it possible to make $2,000 to $3.000 a day with $120 ,000 BP? Theoretically yes!!! , and I have done it many times but on long run I kept being a loser just like he went down.  I decided to stop the insanity and to be realistic. Spent long long time trading small, very small.  Making $100 to $200 a day with $120,000 BP is what I firmly believe in ..Everything else is LUCK  and that is my opinion. There might be traders there making a killing with $30,000 and I will be glad to follow them on daily basis and very closely to  see what exactly they do, but I doubt there are any , and if there are any,  their luck will run out eventually, This is just me , but hey what do I know ?!?.

I know one thing only : THE LUCK DOES NOT RUN INTO MY VEINS.

I can also say: beating the sharks for $100 each and every day with $120k BP is HUUGE !!!

I may be off  from twitter for a while,  helping my buddy to put him on the right track.

He wants to quit his day job so badly LOL

Have a great week all :) 

@DaChopa

Red Day $WMT

WMT
This was a good losing trade, per plan, without any improvisations to bail out by forcing trades.

WMT

Markets opened in green,  were pretty strong.

WMT gave nice short at 2 min and 5 min opening range break down short , but having the green markets I did not go for the short.

Watched the dive all the way down to the whole number 67.00 into the 200 sma on 5 min. so took the long in anticipation to re-trace 50% into the big opening  drop. 

But it was hammered down by sellers on any attempt to go above 67.20.

The 20 sma cought up with the price ( the price did not bounce to catch up with the 20 sma) so it gave a good short which I did not want to take just because it already had quite a big over-extension of 1 ATR. So not big deal there will another trading day.  I'd rather have these controllable losing days within the normal limits then the huge  PnL swings. 

WMT 5 min risk level 

WMT anticipation 50% entrancement bounce 

WMT creating higher lows

WMT   eod
Once the 20 sma was touching the price, it was a great short set up but simply I did not take it because it was already overextended, SPY was green, so I was cautions not to get cought in a squeeze.

SPY all day in green Will 195 hold ?

Have a great weekend 

@DaChopa

Green day FSLR WMT

Somehow I managed to take a loss on WMT , got too greedy adding more into the short winner that was up nicely

WMT

I shorted at 67.80 or so , after the field attempt to go above 68.00 daily pivot

Never took any profit and shorted more after the bounce up and had to take a loos

WMT

. 

FSLR was a text book long

I was looking of for gap ups to short but happen to see FSLR sitting nicely on   a lunch bad

1. Was up above PDC
2. above 200 sma
3. above rising 20 sma
4. 5 lower highs of 5 min candles into the rising 20 sma
5.  this is Long with size and stop below the 5 min candle
6. Had room to give 1:2  R:R to the daily pivot high 72.00 
7. The short was right below the daily pivot 72.00 break below the 5 min candle with stop above 72.00 HOD   this time I took profit 

FSL

Have a nice weekend 

@DaChopa