Blog Title: :: Move the Markets ::

Daytrading UltraShort Financials ProShares (NYSE: SKF) Again

Darn, those stocktwits people sure do love UltraShort Financials ProShares (NYSE: SKF). It came out on top of their list today, so of course I had no choice but to select it again. Sigh….

But, as you can see, performance is quite good. Check the end-of-trend indicator at the bottom, which gave many good clues about when to exit the positions.

So, by my scorebook, I count the first two short trades as one win, as you’d be sitting in the first when the second arrives. Then the long trade is a nice win. Then we have a short trade that is iffy… depending on where you put your stop you might have bailed for break-even or a small loss. If you did, then the last short of the day got you right back in to close out the day with a winner.

It’s been a while since I’ve posted the rules, so…

• Volume chart chosen based on 30-day average volume (I generally use the overview settings from this reference post on these stock charts).
• New push on the everypush paintbar (first red or green bar)
• Volume pressure on b/a-histogram is up for long, down for short.
• End of Trend is below 90
• Closes above the fast MA for long, and below for short. Candle body must not be touching the MA… candle wick can be touching the MA… that’s still ok.

Those rules are how the mechanical entry dots are generated. Not very complicated… With good tools it’s not too terribly difficult to trade profitably. Most of it is the mental game, and following through on your plan.

Hopefully those stocktwits people will pick more variety soon… I’ll get bored featuring SKF all the time.

Believe it or not I have a really long post on stock trading in the works… it’s been halfway done for months now. I just need time to finish it up. I’m extremely busy lately!

Stocks Mentioned In This Article
Stock	Links
SKF	| |

All Day on ES S&P500 E-Mini Futures

I just took screenshots of all day on ES for someone, so I thought I’d post them. So, here you go….

The little yellow arrows are Bill’s entry signals (this is the main eotpro moderator, who trades live in our chat room all day with my indicators). If the volume pressure is headed the right way, and is a thick line (look at the middle subgraph, purple line), then he almost always gets in. He takes 2/3rds of his position off at 1 point profit, and lets the last 1/3rd of his position run as far as possible. If you look at the chart, you can see that the majority of the good entry signals run at least 1 point. It’s an awesome little system.

Daytrading UltraShort Financials ProShares (NYSE: SKF)

I’m in a hurry today, so this post will be short. As usual, I picked the top stock mentioned on stocktwits.com so that you know I’m not cherrypicking.

Today, it was UltraShort Financials ProShares (NYSE: SKF), and it basically told you to get long in the morning and stepped aside. Not a bad thing…. but I wish it offered a third entry in the afternoon. If you line up the first green bar in the afternoon with the volume pressure you can see why it didn’t flag that entry. However, the price went sideways for three bars until volume pressure popped up. So, here again we have a case where the human would reasonably know to enter, and the simple stock system was…. well… too simple ;-)

Stocks Mentioned In This Article
Stock	Links
SKF	| |

Thanksgiving Video

Hi all… I had a little time so I made a video:

I really am going to try to make more videos…. especially live trades…

Testimonial

I got this email today:

“Hey Richard,

Had a dismal morning…, breaking all of my rules. But I came back in the last hour of trading and just concentrated on your Every Push candles, and was able to make up for all of my earlier miscues.

Just wanted to say Thanks.”

Pretty cool!

This trader is of course referring to the EveryPush paintbars from my eotpro.com indicators. Another trader mentioned to me recently in the live room that they’ve turned a corner since watching everypush. It’s pretty cool to hear.

I ran some figures the other day on my personal trading records, and my win % has gone up quite a bit since I created the volume splitter, and then went up a second time with EveryPush. From like 76% to 80% to 84%, or similar.

No Matter How Stupid the Market Makes You Feel

At least you probably aren’t from this family:

Happy Thanksgiving, everyone!

Daytrading Google Inc. (Nasdaq: GOOG)

I personally love to daytrade the e-minis, and we show off e-mini daytrading in the eotpro.com live room every day. That’s why I have been trying to focus on stocks here at the blog lately: to make sure people understand that our indicators work great on them, too!

As most of you know, I try not to cherry-pick anything. Not the stock (when a reader doesn’t request anything, I simply pick the top-discussed stock on stocktwits). Not the timeframe (I use a volume chart chosen mechanically based on the 30-day average volume). Not the time of day (I show the whole day). Not the indicators (I use the same ones every time, with the same settings). Not the entries (they are chosen mechanically by an entry indicator). And every stock I’ve featured so far has looked decent.

Damn, I’m awesome!

Anyway… the top stocktwits stock today was Google Inc. (Nasdaq: GOOG). We have a short entry and a long entry. You’d probably scratch the short unless you were itching to take profits. But the long was very-well timed! Check it out:

Note that if you were bullish on the open, you could have traded the second bar… the only reason the mechanical entry indicator passed on it was because the end-of-trend indicator was up. That will happen most times when there is a decent-sized gap.

Check out past posts tagged simple-stock-system to see other stocks I’ve featured. It just goes to show that with the right tools, daytrading doesn’t have to be all that complicated….

Stocks Mentioned In This Article
Stock	Links
GOOG	| |

Why I Like the Murrey Math Lines

Can you guess? :-)

We have all been marveling at them in the eotpro.com live room. I don’t know why so many math line implementations are done so poorly, but I really like the concept, and the eotpro implementation that I put together seems to work very well.

Follow the Pain

This is generally good advice for trading all day… but I especially watch for this in over-excited and news-driven markets. Today there was all kinds of talk swirling around about whether there’d be an auto bailout or not, and so on. Markets were in a big downtrend intraday. Price action was getting whippy and volatile. Plus, for a while today Paulson was speaking on TV, and you never know what he will say next to spin the market’s wheels.

So, what can a small trader do? When it’s hard to follow the trend, you can often still follow the pain.

In a big trend, every time price reverses a bit, you can see the top and bottom pickers start to take positions. I always get the urge to join them, because surely the markets need to retrace by now, riiiiight?

Wrong. In a strong trend, especially after 3PM Eastern time, the markets don’t need to retrace, ever.

So, I always fight the urge, and don’t go against the trend at a time like this. What I do instead, is watch for the countertrend plays that don’t go anywhere. Now, regardless of who’s on TV, I know for a fact that lots of eager traders are now underwater on their hopeful positions. I take a position with the trend, and against these trapped traders. As price goes against them, they will have to bail, and this greatly improves my chances of making a nice profit. This will usually work even if I turn out to be wrong, and the trend reverses. You can be sure that the market will flush out the weak hands before heading their way.

See why I like this so much? :-)

Here are two examples from today:

Look at the volume pressure and other indicators to glimpse inside the market… but the main thing I watch for is a compelling-looking countertrend trade. One that I would want to take, myself. Then, when that trade doesn’t move at all, and often careens sideways just under the hurting traders’ entry points, I get ready to pounce and take their money from them. I jump in as red bars start forming, and price starts breaking back down.

In violent markets, these are often the easiest trades you can make. Works well for me, anyway.

EOTPro Math Lines come to NinjaTrader

I saw some of the freely available math line indicators last night… and I was disgusted! Mostly, they show daily lines, which is of no use to me.

I guess I didn’t like the implementations on tradestation, either, because we made our own version for eotpro. So, I made a math line indicator for ninja last night. In the live room, they were asking me to post an example of price bouncing off math lines. So, here you go:

Gorgeous!