# Simulated/Hypothetical trades



## pavilion103

I thought it would be good for people to be able to get opinions/ask questions about either trades they are currently in or looking at getting into.

I am a beginner who is running a simulator. The first one I'd like to get advice on is the following: PDN. 
I shorted this one in the simulator on Friday for $4.73 and it has fallen 16% on volume which is over 7 times its 21 day moving average. 
If I closed out now my profit on this position would be 5R. I haven't encounted a chart like this in my brief time simulating. 
It is best to exit out and take the large daily profit? Does a volume that large ring alarm bells?


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## tech/a

First thing to do if you going live is  post before the trade not in hindsite


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## pavilion103

Yeh that's a good point. 

I didn't intend to post anything but the post was more a result of how to handle the trade from this point onwards. I have no idea what ridiculous volume like that means so I'll close it out.


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## skc

pavilion103 said:


> I thought it would be good for people to be able to get opinions/ask questions about either trades they are currently in or looking at getting into.
> 
> I am a beginner who is running a simulator. The first one I'd like to get advice on is the following: PDN.
> I shorted this one in the simulator on Friday for $4.73 and it has fallen 16% on volume which is over 7 times its 21 day moving average.
> If I closed out now my profit on this position would be 5R. I haven't encounted a chart like this in my brief time simulating.
> It is best to exit out and take the large daily profit? Does a volume that large ring alarm bells?




What were you simulating? Did you have profit targets?

Taking outsized/unexpected gains may be part of your system, but it's always difficult to know what to do when fundamental news get in the way of a position opened on pure technicals.


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## Synergy

pavilion103 said:


> I have no idea what ridiculous volume like that means so I'll close it out.




I think in this case it means a lot of people want to sell uranium stocks...

Personally I think it's an over reaction but time will tell.


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## pavilion103

Synergy said:


> I think in this case it means a lot of people want to sell uranium stocks...
> 
> Personally I think it's an over reaction but time will tell.




Ok. I didn't even realise this was based on news which was released today. Shows how new I am to this


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## skc

pavilion103 said:


> Ok. I didn't even realise this was based on news which was released today. Shows how new I am to this




Same with your ACB on the other thread...

Did you know there was an earthquake in Japan?


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## pavilion103

skc said:


> Same with your ACB on the other thread...
> 
> Did you know there was an earthquake in Japan?




How much fundamental knowledge to I need to have/take into account? Whenever entering a position, after I've done my exploration/filters, should I always check big moves to see if they were a result of news?


Also yes, I am finding it difficult how to handle fundamental news when I am trading on a purely technical basis.


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## skc

pavilion103 said:


> How much fundamental knowledge to I need to have/take into account? Whenever entering a position, after I've done my exploration/filters, should I always check big moves to see if they were a result of news?
> 
> Also yes, I am finding it difficult how to handle fundamental news when I am trading on a purely technical basis.




Many don't but I only trade things that I at least know something about. Just got to find your own style.

But knowing PDN is a uranium play is probably general market knowledge that you will pick up by being in the market long enough...like now.


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## pavilion103

skc said:


> Many don't but I only trade things that I at least know something about. Just got to find your own style.
> 
> But knowing PDN is a uranium play is probably general market knowledge that you will pick up by being in the market long enough...like now.




I guess I've been so caught up on the technical side of things that all I've been looking at is charts. Maybe this has been embedded in my reading books such as "How I made $2,000,000 in the Stock Market" - Nicholas Darvas, where he traded purely on price info and volume I think.


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## pavilion103

What to do with one like this?

Gapped down a lot and looks like a bullish bar (from my limited reading/education).

Is this a good exit point?


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## tech/a

If your short then too early to make a decision---but you need to know why I made that decision. You need to know what your looking for.
Your right there is some buying but until tomorrow you wont know if its actually hidden selling.I expect either an inside day OR a higher high closing lower than todays high.

Oh and I dont know anything about stocks I trade---only what other write up if I read it---I dont care.


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## pavilion103

tech/a said:


> If your short then too early to make a decision---but you need to know why I made that decision. You need to know what your looking for.
> Your right there is some buying but until tomorrow you wont know if its actually hidden selling.I expect either an inside day OR a higher high closing lower than todays high.
> 
> Oh and I dont know anything about stocks I trade---only what other write up if I read it---I dont care.




Ok, so this is then a signal to be cautious and monitor how it goes tomorrow? Which of these statements are correct:
1. If it trades higher and then falls below the close of today it is a very bearish signal? 
2. If it trades higher and closes higher then maybe time to exit?
3. If it trades higher and closes higher on low volume then it's bearish because it means there isn't much buying?


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## tech/a

pavilion103 said:


> Ok, so this is then a signal to be cautious and monitor how it goes tomorrow? Which of these statements are correct:
> 1. If it trades higher and then falls below the close of today it is a bearish signal?
> 2. If it trades higher and closes higher then maybe time to exit? Depends
> 3. If it trades higher and closes higher on low volume then it's bearish because it means there isn't much buying? Depends




Altered each to answer.Sorry cant be more definitive--yet.
Volatility is to be expected and as such will make the Obvious less obvious.


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## pavilion103

tech/a said:


> Altered each to answer.Sorry cant be more definitive--yet.
> Volatility is to be expected and as such will make the Obvious less obvious.




haha you've got me confused mate, but one thing is certain.... I will figure it out as I go.


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## skc

pavilion103 said:


> What to do with one like this?
> 
> Gapped down a lot and looks like a bullish bar (from my limited reading/education).
> 
> Is this a good exit point?
> 
> View attachment 41895




I know many people don't care about fundamentals and trade quite successfully.

But BCI is in the headlines today.

Have a read and tell me that piece of fundamental information doesn't explain what happened in today's bar.


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## ThingyMajiggy

If this is a sim thread, I'm gonna go with an up day tomorrow(just going by that chart). I would have exited at the close of today. Can always short again if volume looks weak etc. Just keep watching, whole point of simming, find out what does what. You'll probably just get twice as confused if you ask people on the net what they think about your positions though. Trade what you think, record, adjust, repeat. Meh


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## Boggo

skc said:


> Have a read and tell me that piece of fundamental information doesn't explain what happened in today's bar.




Do you mean this skc ?
_(Reuters) - Hong Kong-listed Regent Pacific on Tuesday terminated its A$345 million takeover offer for emerging Australian iron ore producer BC Iron , saying it did not have sufficient support of BC Iron's largest shareholder, Consolidated Minerals. _

Regardless, the writing was on the wall (in the price) last month !!!!!!!

(click to expand)


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## skc

Boggo said:


> Do you mean this skc ?
> _(Reuters) - Hong Kong-listed Regent Pacific on Tuesday terminated its A$345 million takeover offer for emerging Australian iron ore producer BC Iron , saying it did not have sufficient support of BC Iron's largest shareholder, Consolidated Minerals. _
> 
> Regardless, the writing was on the wall (in the price) last month !!!!!!!
> 
> (click to expand)




Exactly. Mass exodus in the morning on the collapse of the takeover deal by those who think they are doing low risk takeover arbitrage. Then those on the sideline realise that it is still a viable company... 

I have to say the chart is brilliant and did foretell the story. It is a very good example of how price action can reveal the action of insiders.


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## pavilion103

How do these look at trades to enter 17/3/2011?

I am completely new to trading so don't shoot me down if they are obvious poor opportunities. I started my sim and filtering of trades this week.


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## tech/a

pavilion103 said:


> What to do with one like this?
> 
> Gapped down a lot and looks like a bullish bar (from my limited reading/education).
> 
> Is this a good exit point?
> 
> View attachment 41895




Some analysis now we have further data.
If short i would not be panicking.
Click to expand.


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## pavilion103

What are people's thoughts on this one? I saw the enormous volume and maybe a triangle pattern?


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## pavilion103

How does this one look? I am trying to learn more about volume. Is this description accurate and this trade a potentially strong candidate?


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## pavilion103

And this one


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## tech/a

pavilion103 said:


> What are people's thoughts on this one? I saw the enormous volume and maybe a triangle pattern?
> 
> View attachment 41943




Selling its stuffed.


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## tech/a

pavilion103 said:


> How does this one look? I am trying to learn more about volume. Is this description accurate and this trade a potentially strong candidate?
> 
> View attachment 41975




Getting better the only thing with this is the stop is too wide. Id be waiting for a lower risk entry. Plus will give a few more bars to see what its doing at this resistance where it looks like its gone through.

I like it other than the Stop width.


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## tech/a

pavilion103 said:


> And this one
> 
> View attachment 41976




Coming to resistance--cant tell if some hidden selling in there too early.
Wait a few days.


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## pavilion103

tech/a said:


> Coming to resistance--cant tell if some hidden selling in there too early.
> Wait a few days.




What are the signs that this one is coming into resistance?


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## pavilion103

This one I don't understand. I entered in my sim after the big down day on high volume. To me it looked like there was an unsuccessful test 2 days prior to that which was followed by 2 down days with large spreads on very high volume.

Looking through my notes the only thing I can think of is stopping volume. But on the down day it in fact closed on the low. I don't understand this. Is it a shake-out? or does that only occur on bad news?

It does look, however, like the next 2 days were both tests on average volume, possibly meaning the selling strength is weak and it is likely to go back up?


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## tech/a

pavilion103 said:


> What are the signs that this one is coming into resistance?




This.


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## tech/a

pavilion103 said:


> This one I don't understand. I entered in my sim after the big down day on high volume. To me it looked like there was an unsuccessful test 2 days prior to that which was followed by 2 down days with large spreads on very high volume.
> 
> Looking through my notes the only thing I can think of is stopping volume. But on the down day it in fact closed on the low. I don't understand this. Is it a shake-out? or does that only occur on bad news?
> 
> It does look, however, like the next 2 days were both tests on average volume, possibly meaning the selling strength is weak and it is likely to go back up?
> 
> View attachment 41978




Your doing it again!
Your looking at a single signal *WITHOUT* confirmation from the next bar.

You cant tell what a bar is until it has been confirmed.
You CAN anticipate what it COULD be but thats it.

The third bar has been confirmed as exhaustion by the next 2 bars
The obvious stop is the low of the exhaustion bar.
There is close by over head resistance so this trade has limited upside. about 10-15c!
Not one Id consider.

Although good practice for your analysis.


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## skc

pavilion103 said:


> This one I don't understand. I entered in my sim after the big down day on high volume. To me it looked like there was an unsuccessful test 2 days prior to that which was followed by 2 down days with large spreads on very high volume.
> 
> *Looking through my notes the only thing I can think of is stopping volume.* But on the down day it in fact closed on the low. I don't understand this. Is it a shake-out? or does that only occur on bad news?
> 
> It does look, however, like the next 2 days were both tests on average volume, possibly meaning the selling strength is weak and it is likely to go back up?
> 
> View attachment 41978




Look in more detail of the price action 3 days ago (the day that closed at $1.81). The majority of the volume was at the closing auction, and it only closed there because some silly fund manager needed to off load their holding at 4:10pm that day for whatever reason (e.g. rebalancing their portfolio).

Unless the market rolls over violently, AIX will go back up towards $1.95 in no time.


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## pavilion103

skc said:


> Look in more detail of the price action 3 days ago (the day that closed at $1.81). The majority of the volume was at the closing auction, and it only closed there because some silly fund manager needed to off load their holding at 4:10pm that day for whatever reason (e.g. rebalancing their portfolio).
> 
> Unless the market rolls over violently, AIX will go back up towards $1.95 in no time.




How can you tell that is what happened? Is there anywhere to look that sort of stuff up or you just know from when it happened?
Are those the types of things that I need to be aware of as they happen?

Thanks


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## pavilion103

If I was to enter one like this would I put the stop around $1.85, just below the support line that I drew?


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## skc

pavilion103 said:


> How can you tell that is what happened? Is there anywhere to look that sort of stuff up or you just know from when it happened?
> Are those the types of things that I need to be aware of as they happen?
> 
> Thanks




Just look at the lower timeframe chart and you will see that the last trade at 3:59 was $1.845, then in the closing auction a large volume (670K) went through at $1.81. So someone wanted out on that day with fairly consistent selling, and did a dump to end the day on the low for good measure. You can also see that from the course of sale. In fact the selling probably started the day before.

The next 3 days there were no such volume or selling pressure so I expect the price to float back towards where it was before 16 Mar. Having said that there is no guarantee and may be the seller hasn't finished, and will offload only on Wednesdays and Thursdays... 

If I must trade this today I would put the stop at $1.825 which is the low of the bar yesterday. But like Tech/A said the most I would aim for is $1.95 which is hardly worth the effort...  so no trade imo.


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## pavilion103

I've got a couple of charts here. This one has gone up but the last up day had a narrow spread and struggled to go higher. Does this suggest a lack of buying?




This second one gapped up but closed low the day down after a high volume day the previous day. Does this suggest that much of the volume on the previous day wasn't actually buying strength? A bearish sign?


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## tech/a

*RMS*

Yes but doesn't indicate a change in sentiment --I think this will pause.
Pull back a bit--consolidate over a few days--not a deep pullback--that would be sen as a reversal.

*ELM*

Has reversed at resistance --as noted earlier--pivot point reversal
This is weaker than RMS.


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## pavilion103

This is the one that I'd posted previously. ELM. See comments on the chart for reasons for the entry. Now that it has broken through the resistance level would this be a good time to add to the position?
I also note that it gapped up on high volume and finished at the high of the bar. Surely a bullish sign?


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## pavilion103

btw, orange = support, red = stop loss
Is the initial stop much too far away from the entry (or the support line even)?


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## pavilion103

Is this another opportunity to add to the position? After gapping up on high volume for consecutive days it has tested the downside (into the previous day's high volume area) and then closed on the high). Is it a good or bad sign that it did this on high volume?

Did the best opportunity to add to it actually come 2 days ago on 23/3/2011?


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## pavilion103

This one is an interesting one. It came up in my exploration on the 22/3/2011 when it broke through resistance. 
I listened to Tech/a's when he previously identifed the fact that I am not waiting to see how a move plays out over the next few days.
I held off in my sim. 
This was followed by 2 narrow spread, low volume down days. 

1.Is THIS the time to enter, once it becomes clearer that there isn't much selling pressure?
2. Or should I enter on today's up day (25/3/2011)? If so where do I put the stop loss?
3. Was the right move to enter orignall on 22/3/2011 on the break of resistance?


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## Boggo

pavilion103 said:


> This is the one that I'd posted previously. ELM. See comments on the chart for reasons for the entry. Now that it has broken through the resistance level would this be a good time to add to the position?
> I also note that it gapped up on high volume and finished at the high of the bar. Surely a bullish sign?






pavilion103 said:


> This one is an interesting one. It came up in my exploration on the 22/3/2011 when it broke through resistance.
> I listened to Tech/a's when he previously identifed the fact that I am not waiting to see how a move plays out over the next few days.
> I held off in my sim.
> This was followed by 2 narrow spread, low volume down days.
> 
> 1.Is THIS the time to enter, once it becomes clearer that there isn't much selling pressure?
> 2. Or should I enter on today's up day (25/3/2011)? If so where do I put the stop loss?
> 3. Was the right move to enter orignall on 22/3/2011 on the break of resistance?




Some very nice breakout pickups there pavilion.

ELM seems to be on a mission, I don't hold this (reluctant to add to my longs at the moment) but these are money makers as long as you are ready to bug out when they turn against you.

You have asked a few questions in most of your posts and you may have noticed that no direct replies have been forthcoming. Even though this is a "Hypothetical trades" thread there are potential legal implications associated with direct answers to your questions.

Personally I think you are onto something with some of your selections, only advice would be to get out if it doesn't do what you would like it to and forget about about trying to pick the bottom on stocks that are on the way down, your remaining method will pick them up in time and with less risk.

Yesterdays chart of ELM below, its hesitated and then continued at the last two significant levels, base of next level is $3.01, it closed on 2.77 today.

(click to expand)


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## pavilion103

Thanks for that. Very interesting. 
I'm glad you feel that I am at least making sense with my comments. I guess it is a matter of going from a point of knowing nothing to start to begin to understand why stocks behave the way they do. 

I understand people may feel uncomfortable answering my questions and I do not rely on any information, only use it along with any other information I read.


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## pavilion103

On that note, I've got one more. 

The main issue for me is trying to work out when to enter on the actual breakout and when to wait for confirmation. I know much of it will depend on the background information, but I'm finding it difficult to discern. It seems like most times waiting for confirmation is the wisest move.


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## tech/a

Where is the lowest risk trade on this breakout?
See chart
That is where the best entry is/was.
Regardless of whether it fails or succeeds.
There is another for late comers---see it?


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## TulipFX

tech/a said:


> Where is the lowest risk trade on this breakout?
> See chart
> That is where the best entry is/was.
> Regardless of whether it fails or succeeds.
> There is another for late comers---see it?




When trading breakouts I look to trade the retrace back to test the previous resistance. Limit order about 15 points above previous resistance, SL about 15 below. If that resistance holds it often can shoot up (or down). If it falls back down - the damage is not bad at all.

Remembering too I trade currency, so spreads are smaller then stocks. But I imagine the general idea remains.


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## Boggo

Almost the same tech/a, I would have been a day later than you.
These type of trades are very 'visual' and don't really involve any theory (other than the volume factor perhaps) and can be very lucrative.

(click to expand)


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## tech/a

Yep slightly different


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## pavilion103

How does this one look?

The red line is my stop loss. I think it's too far away at just over 10% from entry. Does anyone agree and have opinions as to where they would place it?




Thanks,
Matt


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## pavilion103

Does anyone think this is a good option?
Breaking through a double bottom pattern and gapping up with a wide range bar on high volume? Or is it best to wait a day for confirmation?


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## pavilion103

Here is another on I entered on Friday. 

How does this look. And is this stop loss (red line) reasonable? (it's 3.5%)




Thanks Matt


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## pavilion103

How is this one looking guys. 
I think I am getting my head around it a bit more. 
The one issue I am still having is determining my stop loss. Does anyone feel I my stop losses on the last few posts have been too far away from price? Are there any suggestions of where I should put them?




Thanks,
Matt


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## pavilion103

This is an interesting one. How do we read this? It looks bearish gapping up and then closing near the low of the bar. I'm not sure what having relatively high volume means here. What can we expect tomorrow?


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## pavilion103

What do we think of this one? I got in on a previous breakout. 

A down day on light volume closing at the low of the bar with a widish bar. There was also a low volume down day 2 days prior. Lack of selling pressure?


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## tech/a

No its weak.
There have been 2 up thrusts and no carry through.
Low volume down bar that follows indicates no demand.
	

		
			
		

		
	




*I dont know if you know you've done this* but posts 49/50/51 were great trades.
What you managed to find were tight micro patterns in the breakout setup.
All went on to better things.


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## pavilion103

tech/a said:


> No its weak.
> There have been 2 up thrusts and no carry through.
> Low volume down bar that follows indicates no demand.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> View attachment 42382
> 
> 
> *I dont know if you know you've done this* but posts 49/50/51 were great trades.
> What you managed to find were tight micro patterns in the breakout setup.
> All went on to better things.




Thanks for that Tech. Some obvious up thrusts that I missed there. I need to get the bar chart sorted out (without the open), if I'm going to continue using VSA. I'll need to sort it out in Amibroker. 

With those other ones that you gave me positive feedback on only one of them has gone on with it, ALK (3.5R for me so far). With those other ones, was there any obviouis exit, when I should have gotten out? No dsoubt my 2xATR stop is not sufficient. I'm only using it because I have nothing else yet.


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## pavilion103

The other thing I don't understand is the volume accompanying an upthrust. 

This is how I see it, please tell me if this is right:
A. Real weakness appears when there is an uptrust on high volume (which obviously means the high volume represented selling)

B. If the market rises during the day but closes near the low on LOW volume, this shows no demand. 

Is the real weakness apparrant when B follows A?

(Otherwise we would just be saying whether it is high (A) or low (B) volume makes no difference to an upthrust because one means selling and the other means no demand? This is what I can't distinguish between)


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## pavilion103

Do you often sell at the first sign of weakness Tech? For example here is a chart for AAD. After rising to a new high there was an upthrust followed by a down day on about average volume. 

If you were in the trade would you consider selling at points either one or two on the chart?


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## tech/a

pavilion103 said:


> The other thing I don't understand is the volume accompanying an upthrust.
> 
> This is how I see it, please tell me if this is right:
> A. Real weakness appears when there is an uptrust on high volume (which obviously means the high volume represented selling)




Initially look for the next day to be a down day to show hidden selling volume in the upthrust the day before. High volume on an upthrust by itself cannot be initially seen as buying or selling (Unless you have Tick charts) initially.



> B. If the market rises during the day but closes near the low on LOW volume, this shows no demand.




Yes



> Is the real weakness apparrant when B follows A?



It could but may manifest it self in a high volume down day.



> (Otherwise we would just be saying whether it is high (A) or low (B) volume makes no difference to an upthrust because one means selling and the other means no demand? This is what I can't distinguish between)




Look beyond the single bar.
Read the bar before and the bar after to establish a better pattern.
It will become easier to read.


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## tech/a

pavilion103 said:


> Do you often sell at the first sign of weakness Tech? For example here is a chart for AAD. After rising to a new high there was an upthrust followed by a down day on about average volume.
> 
> If you were in the trade would you consider selling at points either one or two on the chart?
> 
> View attachment 42451




AAD is a typical chart which demonstrate exactly what I keep ratting on about---establishing where a breakout is in the life of a chart.
Clearly the trend is established and there has been a long wave 4/5 consolidation
This was always going to be a short movement.

I would have been out at $1.50 when old resistance didn't hold as support.


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## AlterEgo

pavilion103 said:


> if I'm going to continue using VSA. I'll need to sort it out in Amibroker.




You may not be aware of it, but there is a version of VSA written for Amibroker. Karthik Marar from www.vpanalysis.blogspot.com wrote it, but the link from that website appears to be dead at the moment. It's available on 4shared.com though. Try http://www.4shared.com/file/QHsclq7a/VPA_V11.htm

I haven't used it myself yet, so let me know how you go with it.


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## pavilion103

AlterEgo said:


> You may not be aware of it, but there is a version of VSA written for Amibroker. Karthik Marar from www.vpanalysis.blogspot.com wrote it, but the link from that website appears to be dead at the moment. It's available on 4shared.com though. Try http://www.4shared.com/file/QHsclq7a/VPA_V11.htm
> 
> I haven't used it myself yet, so let me know how you go with it.




Mate, that is sensational. 
I'm not sure how to remove the "open" from the bar so that is only has the high, low and close but I posted this in the Amibroker thread. 

This chart is really fantastic though for someone like me starting out and points out some obvious things that I may have missed by just looking at it on my own. 

Thanks


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## pavilion103

How does this one look?

Explanation on the chart.

(in addition, how does the stop loss look? Is it much too far away at 10.37%? I'm not sure where else to put it other than just below the support line)

Also, how does the layout of my analysis look? Does it summarise the trade well for someone to be able to read it and make sense of it? Or is there too much analysis? (obviously some of those numbers are zero because the price hasn't moved yet)


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## tech/a

*Yes be very very careful.*

The code used for VSA that I have seen and written for Amibroker is often in correct.
it was written by someone who didn't have a sound understanding of the method.

Often signals are generated by a combination of bars and volume--this was missed by the author.

What do the red arrows represent in the chart above?

There are so many points noted on that VSA chart how the hell do you read it???


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## pavilion103

I had a couple of concerns with this one:

1. Not sure where to put the stop loss. I put it 1 tick below the low of today's close (which is also just below the resistance/support level)

2. Should I be concerned about the overhead resistance (top orange line)?


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## pavilion103

pavilion103 said:


> Mate, that is sensational.
> I'm not sure how to remove the "open" from the bar so that is only has the high, low and close but I posted this in the Amibroker thread.
> 
> This chart is really fantastic though for someone like me starting out and points out some obvious things that I may have missed by just looking at it on my own.
> 
> Thanks




Ok I sorted it out. I've removed the open bar and also added some code to make the background black to I can actually see it a bit clearer with all those bright colours. Let me know if you need a hand


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## tech/a

Both trades taken too early in my opinion.
There is no proof that there is a breakout.
High volume at a point/area of resistance
needs to be proven.


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## captain black

pavilion103 said:


> if I'm going to continue using VSA. I'll need to sort it out in Amibroker.




It may have been mentioned somewhere else so apologies if it has, but there's an Amibroker VSA yahoo group worth subscribing to if that's the/a direction you're heading. There's some great code in the "files" section along with the VSA code for Amibroker mentioned earlier in this thread.

http://finance.groups.yahoo.com/group/Amibroker-VSA/


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## pavilion103

tech/a said:


> *Yes be very very careful.*
> 
> The code used for VSA that I have seen and written for Amibroker is often in correct.
> it was written by someone who didn't have a sound understanding of the method.
> 
> Often signals are generated by a combination of bars and volume--this was missed by the author.
> 
> What do the red arrows represent in the chart above?
> 
> There are so many points noted on that VSA chart how the hell do you read it???




Ok I will be careful when looking at it. 

Red arrows on the chart are simply when it breaks below the 2xATR moving average (I should remove the arrows if I can work out how to, I probably don't need them to be honest)

I have no idea what some of the stuff on the VSA chart is. All I am using it for is the bars and the notes on "volume, spread, close" and general notes which may get me thinking a bit of things I hadn't considered.


----------



## pavilion103

tech/a said:


> Both trades taken too early in my opinion.
> There is no proof that there is a breakout.
> High volume at a point/area of resistance
> needs to be proven.




Ok. Based on your advice I need to make sure:
1. I don't analyse a bar in isolation (which I have been trying to do now)
2. Don't enter a trade too early simply because it broke through a resistance level on high volume.

I guess it depends on price action in the next few days, but as a general rule, would a large number of trades either be confirmed or rejected the following day or two (in both of these chart examples?)


----------



## pavilion103

captain black said:


> It may have been mentioned somewhere else so apologies if it has, but there's an Amibroker VSA yahoo group worth subscribing to if that's the/a direction you're heading. There's some great code in the "files" section along with the VSA code for Amibroker mentioned earlier in this thread.
> 
> http://finance.groups.yahoo.com/group/Amibroker-VSA/




Thanks Captain Black. I'll take a look mate.


----------



## tech/a

> Ok. Based on your advice I need to make sure:




(1) dont use amibroker VSA formulas they are wrong.
(2) learn how to trade VSA before you plot it on charts.
(3) If you really must plot it on charts buy the real stuff
Tradeguider or even better wait for Todd Kruger's new software.
(4) keep at it only 9950 hrs to go.


----------



## captain black

pavilion103 said:


> Thanks Captain Black. I'll take a look mate.




No probs, all the AFL code in the files section is open and publically available so is easy to customise to whatever you may need and you'll find the group quite open to discussion.


----------



## pavilion103

tech/a said:


> (1) dont use amibroker VSA formulas they are wrong.
> (2) learn how to trade VSA before you plot it on charts.
> (3) If you really must plot it on charts buy the real stuff
> Tradeguider or even better wait for Todd Kruger's new software.
> (4) keep at it only 9950 hrs to go.




What do you mean by (2)? Are you saying I need to be able to make my own judgements in terms of volume, spread, the meaning of bars in conjunction with the previous few bars, identifying uptrusts etc..?

I don't really feel that I need to plot them. I'm just trying to work out how best to learn it. Are you saying it's more useful for my education if I can try to identify strength and weankess first without the relying on the program?


----------



## Wysiwyg

pavilion103 said:


> I had a couple of concerns with this one:
> 
> 1. Not sure where to put the stop loss. I put it 1 tick below the low of today's close (which is also just below the resistance/support level)




Greetings.

Am interested in the AFL for the boxes below. Have not seen that anywhere but it looks like something from Brian at Tipster Trendlines.  Am hoping you can direct me to the AFL please.


----------



## pavilion103

Wysiwyg said:


> Greetings.
> 
> Am interested in the AFL for the boxes below. Have not seen that anywhere but it looks like something from Brian at Tipster Trendlines.  Am hoping you can direct me to the AFL please.




Hey mate,
Those boxes are actually part of an excel file that I created myself, that I track my simulated trades in (I am just starting out). 

The screen shot is simply a cut and paste. I took a screen shot of the Amibroker chart and then pages the cells from my excel file on top of it . So no Amibroker formula or anything for.


----------



## tech/a

pavilion103 said:


> What do you mean by (2)? Are you saying I need to be able to make my own judgements in terms of volume, spread, the meaning of bars in conjunction with the previous few bars, identifying uptrusts etc..?
> 
> I don't really feel that I need to plot them. I'm just trying to work out how best to learn it. Are you saying it's more useful for my education if I can try to identify strength and weankess first without the relying on the program?




Yes Of course.
There is no better computer than the grey matter.


----------



## Wysiwyg

pavilion103 said:


> Hey mate,
> So no Amibroker formula or anything for.




Righto then.


----------



## pavilion103

This is a trade I did NOT take. 

I'm more interested in working out where I would place a stop loss had I taken this trade. The level of resistance is too far away (11.6%). The red line represents 1 tick above the low of the previous day (5.3%). 
I am struggling to get my head around where to place stops. At the moment I've only been placing them just behind support/resistance levels.


----------



## pavilion103

I'm very interest in trying to work out this one. 

Big up day on high volume with a very wide spread, followed by an upthrust on high volume which then failed to continue downward. I'm not sure what it means that the last bar was on high volume (this bar seems bullish to me). I'm not sure how to interpret these 3 bars in conjunction with one another.


----------



## tech/a

Have a shot yourself.
Its not that hard.


----------



## pavilion103

My take on it is that I would want to wait for confirmation after the first big up day on high volume (prior to this there were a couple of down days on very low volume - signalling no selling pressure?).

The upthrust the next day could have proven to be bearish if the next day had fallen, closing near the low of the bar, on light volume signalling no demand. 

Today the price rose however on high volume and closed towards the high of the bar. This would mean that yesterday couldn't have been selling pressure because how could prices have risen the following day (today) if it was selling pressure?

(the one thing I am unsure about is that it appears today was a 'test'. There was high volume today so would this mean that the test failed? Usually a test with low volume shows that there is little selling into the market). This would not be a sign of strength.

How does this sound? (btw I would NOT enter)


----------



## tech/a

Todays price action can be explained by this announcement.

http://stocknessmonster.com/news-item?S=TRH&E=ASX&N=537950

I too would be waiting for volume to settle.
Today had a heap of effort for little result.
If it climbs on low volume then thats a buy.
If it drops on low volume then its for the watch list.

I expect an inside day tomorrow.


----------



## pavilion103

tech/a said:


> Todays price action can be explained by this announcement.
> 
> http://stocknessmonster.com/news-item?S=TRH&E=ASX&N=537950
> 
> I too would be waiting for volume to settle.
> Today had a heap of effort for little result.
> If it climbs on low volume then thats a buy.
> If it drops on low volume then its for the watch list.
> 
> I expect an inside day tomorrow.




If it rises on low volume what does that suggest? That there is no selling pressure?
What would a rise on HIGH volume suggest?

Thanks,
Matt


----------



## tech/a

pavilion103 said:


> If it rises on low volume what does that suggest? That there is no selling pressure?
> What would a rise on HIGH volume suggest?
> 
> Thanks,
> Matt




Lack of sellers.

If high volume on a wide spread or a gap up then that could be renewed buying.
But you really need a day of low volume after or before it to be able to really tell.

Lets keep an eye on it and read it as it happens.
My bet is an inside day on average volume compared to the last 3 days.
Id be surprised if it took out the high and stayed there.


----------



## pavilion103

How does this one look.

There was a successful test (low volume) on 19/4. This one was followed by a fairly flat day and then an upday with narrow spread and low volume. Strength was confirmed on 27/4 with price gapping up on a high volume up day. Price broke into new territory today on a high volume, wide spread up bar. 

Is this a good one to enter? Could I have entered the day earlier (the first high volume up day after the successful test)? Or would that have been a dumb move with the overhead resistance. Is now potentially a good time to enter?




p.s. I am not using the Amibroker VSA analysis, merely using the chart as a better visual representation for VSA. I have already deleted parts of it to stop my confusion.


----------



## toocool

tech/a said:


> Tradeguider or even better wait for Todd Kruger's new software.




Ive been pretty close to buying Tradeguider but that has got me thinking..

When is it expected out Tech ? if you know,  and what will the advantages be over Tradeguider ?


----------



## tech/a

toocool said:


> Ive been pretty close to buying Tradeguider but that has got me thinking..
> 
> When is it expected out Tech ? if you know,  and what will the advantages be over Tradeguider ?




I have just shot off an email to Todd.
Better get the answer from him.

If hes around should have a reply by morning.


----------



## pavilion103

The trade above hasn't reacted as I anticipated. A very high volume upthrust. 

I haven't worked on my stop strategies much yet and that is the next step for me. Would it be wise to exit immediately on this day? because it appears the previous day's strength is actually weakness.
Or would I await further confirmation? i.e another down day




Thanks,
Matt


----------



## tech/a

*Matt

ABY*

Dont you love analysis.
I see your looking at trading volume on breakout.
you need to read the Tips and Tricks on breakouts.
Ive been meaning to get around to adding to the thread with the topic of
*"Not all breakouts are equal"*
I ll use this chart as an example.

While there were indications of weakness there were also indications of diminished supply. As volume grew with range you need to be wary of Supply coming in.

Had you bought on the Breakaway gap (First one) which is a breakout in itself (another topic on breakouts) you could be out with a profit---selling the Pivot.

Click to expand


----------



## pavilion103

tech/a said:


> *Matt
> 
> ABY*
> 
> Dont you love analysis.
> I see your looking at trading volume on breakout.
> you need to read the Tips and Tricks on breakouts.
> Ive been meaning to get around to adding to the thread with the topic of
> *"Not all breakouts are equal"*
> I ll use this chart as an example.
> 
> While there were indications of weakness there were also indications of diminished supply. As volume grew with range you need to be wary of Supply coming in.
> 
> Had you bought on the Breakaway gap (First one) which is a breakout in itself (another topic on breakouts) you could be out with a profit---selling the Pivot.
> 
> Click to expand
> 
> View attachment 42664





Thanks again Tech,

I have found it difficult to know which breakout to enter on. The reason I didn't buy on the breakaway gap was due to the resistance overhead I would encounter. 

I've got this old mindset from before I heard a lot of your advice that I should NEVER buy if there is resistance potentially approaching.


----------



## tech/a

pavilion103 said:


> Thanks again Tech,
> 
> I have found it difficult to know which breakout to enter on. The reason I didn't buy on the breakaway gap was due to the resistance overhead I would encounter.
> 
> I've got this old mindset from before I heard a lot of your advice that I should NEVER buy if there is resistance potentially approaching.




*Not NEVER.*

If resistance is near then there is a good chance that the move will at least pause.
But resistance is often broken and they are the ones to be on.
I will take larger positions on stocks which have no or far away resistance ahead.
Ill take smaller positions on those where resistance is close or not very old.
If it breaks that resistance then Im in *AGAIN* boots and all.

*ABY* pivot was a leading indicator I note.


----------



## pavilion103

Ok that clarifies things for me. Thanks

What about this one below?

I was analysing this one which I thought was interesting. I tried to analyse the background price action. 
There was an upthrust on the bar (with the red above it) followed by a down day. 
But this was followed by a number of down days on low volume (underlined in blue) indicating a lack of selling. 
This then rises on a higher volume bar (underlined in green).

Could it have been a good move to buy on this bar (underlined in green)? Or was it important to wait for further confirmation?

I have ONLY been entering of break of support/resistance, so I'm trying to identify times when I should enter before hand. In this example it appears the bar underlined in green confirmed the weakness in the background.


----------



## tech/a

toocool said:


> Ive been pretty close to buying Tradeguider but that has got me thinking..
> 
> When is it expected out Tech ? if you know,  and what will the advantages be over Tradeguider ?




Just received a reply from Todd.
From exchanged emails later I feel his software will be more about practical application of VSA AND associated RELEVANT analysis,than Tradeguider's alert and explanation type software.
Tradeguider is a great start and altered my trading.
I really hope Todd's gives guys like me some real meat.

Click to expand


----------



## toocool

Sounds very interesting indeed, although it does sound a little way off completion. 

I have been watching and reading alot of material on Tradeguider and was very close to buying it,  with the main reason for not, was im going overseas for two months traveling from July so I was going to purchase it after getting home.

Maybe by September when Im back it will be clearer about a market date for the software...


----------



## Wysiwyg

toocool said:


> Sounds very interesting indeed, although it does sound a little way off completion.
> 
> I have been watching and reading alot of material on Tradeguider and was very close to buying it,  with the main reason for not, was im going overseas for two months traveling from July so I was going to purchase it after getting home.
> 
> Maybe by September when Im back it will be clearer about a market date for the software...



I thought TradeGuider was by subscription and you can't actually buy the software outright?


----------



## pavilion103

I have a couple of questions about this one:

1. Is the stop too wide. I entered on the first bar the broke support. The initial stop is only 2.5% away from entry price but visually it looks like it is maybe too far away? Could I place it just above the support level (say, $6.88 which would make the initial stop 1.8% from entry price)?

2. a. Is this a good trailing stop (1 tick above the pivot point reversal)?
    b. Alternatively, could I have exited on the actual day of the pivot point reversal or is that too soon?

Some opinions would be much appreciated. 

Thanks,
Matt


----------



## tech/a

Wysiwyg said:


> I thought TradeGuider was by subscription and you can't actually buy the software outright?




No you own it.


----------



## pavilion103

With one like this, is my trailing stop good? Is it too early to exit on the first sign of weakness (a pattern like this) or should I wait until/if my trailing stop gets hit?


----------



## tech/a

pavilion103 said:


> With one like this, is my trailing stop good? Is it too early to exit on the first sign of weakness (a pattern like this) or should I wait until/if my trailing stop gets hit?
> 
> View attachment 42939




Its an Island reversal--not good--
My initial stop would be at the Pivot low so much wider.
Running stops like you are with no real support at them will see you stopped out regularly.
Id be suprised if you didnt bleed badly.


----------



## skc

pavilion103 said:


> With one like this, is my trailing stop good? Is it too early to exit on the first sign of weakness (a pattern like this) or should I wait until/if my trailing stop gets hit?
> 
> View attachment 42939




Closed my position yesterday at 38.5c. Would be interested again if it closes the gap at 31.5c.


----------



## pavilion103

tech/a said:


> Its an Island reversal--not good--
> My initial stop would be at the Pivot low so much wider.
> Running stops like you are with no real support at them will see you stopped out regularly.
> Id be suprised if you didnt bleed badly.




My initial stop is already 12.5% from entry. Are you saying you would consider going even wider than 12.5%? (at what level is the Pivot low?)

Would you have trailed the stop at all or was it way too early for that? 
If you were in my position, would you exit IMMEDIATELY on an island reversal?


----------



## pavilion103

skc said:


> Closed my position yesterday at 38.5c. Would be interested again if it closes the gap at 31.5c.




Pardon my ignorance but did you exit when price trades below the low of the previous day? Is the reason for exiting at this in part due to the fact that it had risen quite rapidly in the preceeding bars?


----------



## skc

pavilion103 said:


> Pardon my ignorance but did you exit when price trades below the low of the previous day? Is the reason for exiting at this in part due to the fact that it had risen quite rapidly in the preceeding bars?




Yes stop was moved up to 1 tick below the island reversal. This was a runner so it is always susceptible to coming back down on the same slope/angle. Already gave back a fair bit from the high so not interested in holding in the current market.


----------



## romeo

Great thread guys, been reading closely and trying to follow. Also half through "master the markets", interesting book so far (pdf)

I think what tech means by pivot low is 25cents. Ie, the low at the time of the pivot to the upside. (Awaiting confirmation from tech, however I'm probably wrong) If this is the case: I agree that this is a wide stop. 

Perhaps what Tech is saying is that you would not enter where you did because his logical stop is so far away. I fly the flag for newbies and I entered a day later (on the 12th) and got stopped out today. That's the price of education. 

Is this 'strictly' an island reversal as there is no clear gap between the bars from 12th, 13th and 16th of May? Could this be a 50% retrace? Another factor for me is that today's volume is low compared to the days previous (so far anyway).


----------



## romeo

cross post from GTE thread but I think it's in theme with this thread.

10th to 12th of May (Inclusive): we see relatively small spreads, up candles, low volume

13th of May: small spread, down candle, low volume

16th of May: (this is what initially got my interest). Wide spread, down candle, high volume (greater than 4x previous 10 days average volume).

I was thinking that this is a bearish sign because of the high volume that I assume was selling; added to this was the fact that the SP closed on it's low. However I looked to the days previous and wasn't exactly sure. It needed another down day today to confirm the downside. After all, if it's a lot of selling then why doesn't the SP fall?

Today we have basically no volume with the buyers and sellers at a stand off. Perhaps GTE has some upside potential. However there is a crapload of resistance nearby. The SP tested 42cents a couple of times and I'd like to see it go above this resistance. 

Any other views? Sorry for crappy chart, I only use Westpac at the moment. Looking to get amibroker soon.


----------



## pavilion103

What do people think of this one? PTM. After a small consolidation period including up bars on low volume, price has broken below the lowest low on relatively higher volume. Price closed below this point yesterday for the second consecutive day on highish volume.

Also where would be the best place to put the stop. Is above the consolidation too far from entry price? Cheers


----------



## pavilion103

Can I please get an opinion on this one?

I'm testing some old data and want to ask where people think the best stop would be. The percentage of the stop from entry price is shown on the chart. I've entered on confirmation above resistance.

Is stop 1 a poor stop because it isn't a significant support?
Is stop 2 too far from entry price or is this ok?


----------



## pavilion103

I'd be interested in some thoughts on how people would manage this trade. I got in it yesterday and it has gapped up a fair bit in the first day. Is it worth moving the stop after one day (e.g. 1 tick under the gap or maybe move it to breakeven)?


----------



## Boggo

There are many factors such as $ at risk, number of shares etc etc that make it impossible for anyone to provide the answer, you need to have a 'what if' method to start with when you enter the trade.
Under normal circumstances the market does not like gaps and if it comes back to close the gap it may take a few nervous nellies out too which can set off a short run down below the gap.

You seem to have the understanding in place, only you can work out what works for you when you apply that.

One of many approaches on the chart (yesterdays) below but not by any means the answer.

(click to expand)


----------



## skc

pavilion103 said:


> I'd be interested in some thoughts on how people would manage this trade. I got in it yesterday and it has gapped up a fair bit in the first day. Is it worth moving the stop after one day (e.g. 1 tick under the gap or maybe move it to breakeven)?
> 
> View attachment 43642




It's a gold stock. Look at the gold chart and see if this stock deserve more breathing space or tight stop.


----------



## pavilion103

Thanks for that Boggo. 

I realise no one is better able to answer my questions than myself through testing and in conjunction with the rest of my system. I have been spending A LOT of time working on specific trading rules recently. I've taken bits and pieces from various places, put them together, tweaked them as I go. 
Having read Curtis Arnold's PPS Trading System most recently one thing I've been playing around with is moving the stop to breakeven when the trade moves into 1R profit (he suggests 2R). 
This is why I am open to ideas. 
I am trying to solidify my strategy to know what I will do in EVERY conceivable scenario. I'm getting there! Making a lot of progress. 




Boggo said:


> There are many factors such as $ at risk, number of shares etc etc that make it impossible for anyone to provide the answer, you need to have a 'what if' method to start with when you enter the trade.
> Under normal circumstances the market does not like gaps and if it comes back to close the gap it may take a few nervous nellies out too which can set off a short run down below the gap.
> 
> You seem to have the understanding in place, only you can work out what works for you when you apply that.
> 
> One of many approaches on the chart (yesterdays) below but not by any means the answer.
> 
> (click to expand)


----------



## tech/a

Why do you think he chose 2R and not your 1?


----------



## Boggo

Boggo said:


> Under normal circumstances the market does not like gaps and if it comes back to close the gap it may take a few nervous nellies out too which can set off a short run down below the gap.




Gap closed with a 5 cent overlap as expected so you would have been take out if you had your stop one tick below the gap pavillion.

Will it resume it's uptrend ?

You may find that there may be a few sellers in the gap area when this happens, they look and see that it has dropped by 10 to 15 cents and they panic without understanding that it is just a common process occurring.


----------



## tech/a

*Boggo/Pav*
The question then is do you sell at $2.69 or at a close below $2.69 on NEXT open (Being an EOD trade).
The answer is the results of your testing.
In absence of testing its something you set as a rule until proven incorrect or improved.
Its been my experience that either way (Hitting stop or EOD next open) it all smooths out.
Some better and some worse than each other.


----------



## Boggo

tech/a said:


> *Boggo/Pav*
> The question then is do you sell at $2.69 or at a close below $2.69 on NEXT open (Being an EOD trade).




I would be having a close look at the low of today as a point of interest tomorrow, ie, you've closed the gap now get on with resuming the climb or else.
If I was looking intraday then a return to today's earlier low would be a consideration.


----------



## Mistagear

as per Trends. Beginnings thread.

RRL stop @282.
Todays bar (as yet unclosed) creates a downside target of 255.
My method would be to watch how price approaches the lower swing target to determine possible re-entry.
Sometimes I place a buy-stop at the exit price if so desired. Considering the volume/range relationship today, I would not have an order in the market as yet.

Cheers, M


----------



## pavilion103

Boggo said:


> I would be having a close look at the low of today as a point of interest tomorrow, ie, you've closed the gap now get on with resuming the climb or else.
> If I was looking intraday then a return to today's earlier low would be a consideration.




I haven't had a chance to reply to all posts but interesting that the low was the same as the close on the bar prior to the gap. If stop was placed 1 tick below, would still be in the trade. Anything higher and stopped out.


----------



## Boggo

My Metastock weekly breakout scan has RRL as a selection again this week.

The generated stop is at 2.35 on the weekly.

A much more stable view than the daily chart.

(click to expand)


----------



## pavilion103

I was hoping to get some thoughts on this one. 

I'm not sure where to put stops on a big gap down day like this one. As you can see I have 2 hypothetical trailing stops. 

1. One tick above the low of the bar prior to the gap (red)
2. One tick above the high of the bar after the gap (purple

The purple stop doesn't give much room to move. I seem to think the red stop is quite good but would be interested to see people's logic/thoughts.


----------



## tech/a

This is a short trade?


----------



## pavilion103

tech/a said:


> This is a short trade?




Yes, short.


----------



## simoncar

Pavilion, you seem like a nice guy so don't take this the wrong way. You have got to stop asking questions of other people and start asking those questions of yourself. I could show you how I would manage that open trade, Tech could show you a different way, Boggo another. Go look at hundreds of charts that have had gap moves....what are the similarities what are the differences. You have got to the work out some form of trade management that would work well MOST of the time. Not just on this AMP trade. If I tell you where I would put my stop and then the next day my stop got hit, you are going to think "well that fool has got no idea". There is more than enough info on the net RE trade management ideas.....go away and test these. Trading profitably is so much about psychology. You only really understand this when you become consistantly profitable I believe. YOU have to design your trading method to allow YOU to feel comfortable trading it. All the time knowing you have a positive expectancy and what the expected max drawdown will be.


----------



## pavilion103

simoncar said:


> Pavilion, you seem like a nice guy so don't take this the wrong way. You have got to stop asking questions of other people and start asking those questions of yourself. I could show you how I would manage that open trade, Tech could show you a different way, Boggo another. Go look at hundreds of charts that have had gap moves....what are the similarities what are the differences. You have got to the work out some form of trade management that would work well MOST of the time. Not just on this AMP trade. If I tell you where I would put my stop and then the next day my stop got hit, you are going to think "well that fool has got no idea". There is more than enough info on the net RE trade management ideas.....go away and test these. Trading profitably is so much about psychology. You only really understand this when you become consistantly profitable I believe. YOU have to design your trading method to allow YOU to feel comfortable trading it. All the time knowing you have a positive expectancy and what the expected max drawdown will be.




Thanks for the feedback. Appreciated. 

Yes I understand that and I am spending many many hours testing all sorts of things. I certainly understand that there are no shortcuts to finding what works best and that everyone has their own opinions based on their own systems which they have developed.

But the benefit for me is if I see a number of experienced, respected people (who have studied many many more scenarios than me) point me in the same direction then it is certainly of value to me (although not a substitute for my own testing). I have learnt and incorporated so much into my trading system from thoughts in this thread. 

I appreciate your honest feedback and agree with the value of my own testing above anything else.


----------



## tech/a

Well
My view is that your on the wrong side of the trade.

To me this is a long not short trade.
I'll leave it to you to discover why.
If your interested


----------



## joea

pavilion103 said:


> I was hoping to get some thoughts on this one.
> 
> I'm not sure where to put stops on a big gap down day like this one. As you can see I have 2 hypothetical trailing stops.
> 
> 1. One tick above the low of the bar prior to the gap (red)
> 2. One tick above the high of the bar after the gap (purple
> 
> The purple stop doesn't give much room to move. I seem to think the red stop is quite good but would be interested to see people's logic/thoughts.
> 
> View attachment 44036




pavilion103.
I do not know what you have read, but Elder has a book titled "The new sell and sell short".
It has a chapter on, Selling on a stop.
It has a chapter, Selling at a target. Selling Engine noise.
It has a chapter, How to sell short.

In the chapter, Selling on a stop, the following are covered.
The Iron Triangle, Market or Limit orders, hard and soft stops,a badplace, reducing slippage,   when to use wider stops, moving stops, volatility-drop trailing stops.
Following this it has 50 questions on checking what you have learnt.

The book is about (How to TAKE PROFITS, cut losses,and benefit from price decline.)

Chck it out at amazon or ELDERS site. AMAZON allows you to look at the contents of the book.

just a thought as all your questions are answered.
You my also get it at FISHPOND, but confirm if it is in stock first at FISHPOND.
joea


----------



## pavilion103

joea said:


> pavilion103.
> I do not know what you have read, but Elder has a book titled "The new sell and sell short".
> It has a chapter on, Selling on a stop.
> It has a chapter, Selling at a target. Selling Engine noise.
> It has a chapter, How to sell short.
> 
> In the chapter, Selling on a stop, the following are covered.
> The Iron Triangle, Market or Limit orders, hard and soft stops,a badplace, reducing slippage,   when to use wider stops, moving stops, volatility-drop trailing stops.
> Following this it has 50 questions on checking what you have learnt.
> 
> The book is about (How to TAKE PROFITS, cut losses,and benefit from price decline.)
> 
> Chck it out at amazon or ELDERS site. AMAZON allows you to look at the contents of the book.
> 
> just a thought as all your questions are answered.
> You my also get it at FISHPOND, but confirm if it is in stock first at FISHPOND.
> joea




I will definitely get that one then. Coincidently I was actually looking at that last night on Amazon. 
I've got his book, "Trading for a Living" but none of his others. I've heard he is excellent. 

Thanks


----------



## pavilion103

I just ordered it.


----------



## joea

pavilion103 said:


> I just ordered it.




pavilion
Elder has his point to put across. His books are good reading.
He trades in a certain way.
The Share market College education is based on the book you have got and a sofware package called Market Analyser.

Now the point I would like to make is on this forum there are some astute traders.
So if you start with Elder and intergrate some of the comments here I would like to think you will make it.
At the end of the day its "price and volume".
joea


----------



## nomore4s

Don't forget the ASF shop when looking to buy books on investing/trading.

ASF SHOP


----------



## pavilion103

tech/a said:


> Well
> My view is that your on the wrong side of the trade.
> 
> To me this is a long not short trade.
> I'll leave it to you to discover why.
> If your interested




I'm thinking because the gap looks like an exhaustion gap? 
There appears to be stopping volume present. A lack of supply is confirmed with a (relatively) low volume test on 11/8.
How does this sound?


----------



## tech/a

> Well
> My view is that your on the wrong side of the trade.
> 
> To me this is a long not short trade.
> I'll leave it to you to discover why.
> If your interested




but then again.
Short today with a stop on the high of the day isn't such a tardy trade either!


----------



## pavilion103

tech/a said:


> but then again.
> Short today with a stop on the high of the day isn't such a tardy trade either!




Low volume, no demand?


----------



## pavilion103

I'd love some thoughts on this one. Got in yesterday before today's wide spread bar. I only trade end of day so couldn't have done anything about it intra-day. 

I don't have much experience with these situations and have placed a stop 1 tick below the high of yesterday's bar. Is this wise? Or is it better to either just exit on open or to give it some more room to move?

The big move was on an announcement (I didn't know there was going to be one, I just used my limited knowledge of VSA to enter).


----------



## pavilion103

Can I please get some thoughts on this one?

First I'd love some opinions as to the quality of my entry. 
Secondly, how is the initial stop placement with this? I wasn't sure if I should have had a very tight stop or the current one at 16%. With the current stop there isn't high R:R potential.


----------



## pavilion103

You'll see that this is a chart from Feb 2004. I'm going over historical data and trading bar by bar.

This is the next one. It shot up sharply. 

With the 16% stop, this represents an open profit of 2.8R

Price increased 20.8% on this day. 


Now my third question is: Where do I exit? After such a sharp rise is it best to take my profit or to simply trail my stop? Volume is looking very strong and consistent.


----------



## Billyb

pavilion103 said:


> You'll see that this is a chart from Feb 2004. I'm going over historical data and trading bar by bar.
> 
> This is the next one. It shot up sharply.
> 
> With the 16% stop, this represents an open profit of 2.8R
> 
> Price increased 20.8% on this day.
> 
> 
> Now my third question is: Where do I exit? After such a sharp rise is it best to take my profit or to simply trail my stop? Volume is looking very strong and consistent.
> 
> View attachment 44838




IMO there is no one answer to this question - it depends on your trading rules. As long as you are sticking to those rules and not just getting out the trade because "I've made a handsome profit for 3 days"

But I like trailing stops because then you are letting the market decide when to get you out of the trade.

Yes 16% is a lot of risk IMO, perhaps you got onto that trade one day too late.


----------



## pavilion103

Billyb said:


> IMO there is no one answer to this question - it depends on your trading rules. As long as you are sticking to those rules and not just getting out the trade because "I've made a handsome profit for 3 days"
> 
> But I like trailing stops because then you are letting the market decide when to get you out of the trade.
> 
> Yes 16% is a lot of risk IMO, perhaps you got onto that trade one day too late.




I generally put a trailing stop under a "wide spread bar" but am playing around with my testing to see if there seems to be a good time to exit on close after a big move rather than waiting to be stopped out. Obviously the tradeoff between big potential profits and giving back profit needs to be considered. 

I've got a couple of simulators open, placing the same trades but exiting at different points. I will compare them to see if there are any glaring inefficiencies staring me in the face. Obviously I don't want to curve fit though. 


And with the 16%, usually I look for risk from anywhere between 4-12%. I need to work out where I am going to place my stops if I choose to take the odd larger risk size trade.


----------



## Billyb

pavilion103 said:


> I've got a couple of simulators open, placing the same trades but exiting at different points. I will compare them to see if there are any glaring inefficiencies staring me in the face. Obviously I don't want to curve fit though.




Nice. No doubt you will find something along the way.


----------



## tech/a

The answer is in understanding when a move is going to stall or reverse.
I agree with Billy that there isnt one hard fast rule.
In fact my rules would have seen me out on the next day.(50% of the previous bar)
I would have been only a little worse off had I kept the trade until further analysis gave me strong clues of a reversal.


----------



## pavilion103

tech/a said:


> The answer is in understanding when a move is going to stall or reverse.
> I agree with Billy that there isnt one hard fast rule.
> In fact my rules would have seen me out on the next day.(50% of the previous bar)
> I would have been only a little worse off had I kept the trade until further analysis gave me strong clues of a reversal.
> 
> View attachment 44840




Is your rule 50% of previous bar stop used for wide spread bars?
Do you have a hard and fast rule?


----------



## Billyb

pavilion103 said:


> Is your rule 50% of previous bar stop used for wide spread bars?
> Do you have a hard and fast rule?




Sorry to butt in here- Dont get the wrong idea about what I meant, I think individual traders do need to have some pretty rigid rules or at least rigid guidelines, if you  kept changing your rules then how would you know whether what you are doing will work over a large number of trades? You are just hoping and praying.

What I meant is that the rules can differ significantly between different traders and thats because it's all the rules that work TOGETHER that make the money, not just a single rule in the methodology like the stop-loss percentage. eg, if we are talking about % based stops, then there must be profitable traders from the 0.5%-50% stop loss range, I'm sure of it.


----------



## tech/a

pavilion103 said:


> Is your rule 50% of previous bar stop used for wide spread bars?
> Do you have a hard and fast rule?




Sorry was a bit vague.
If a stock moves 30 % or more in one session or 40%+ in 2sessions I will then look at each bar.
What I'm trying to do is maximize profits from unusually quick moves.
I have anothervrule for those that open higher an higher chasing right behind the parabolic move.

First though you have to be lucky enough to get on one.


----------



## pavilion103

From my observations it seems like these types of trades are the type that have the potential to produce large R-multiple profits. 

I've tested old data and have entered a number of these types of trades where price is flat and inactive and then a few days of ultra high volume come in. Quite often I've noticed that even though price moves a lot in percentage terms on these first few high volume days. It is only the beginning of a much larger move. 

This is where I seem to by picking up much of my 6R-10R wins. Thoughts?


----------



## Mistagear

pavilion103 said:


> From my observations it seems like these types of trades are the type that have the potential to produce large R-multiple profits.
> 
> I've tested old data and have entered a number of these types of trades where price is flat and inactive and then a few days of ultra high volume come in. Quite often I've noticed that even though price moves a lot in percentage terms on these first few high volume days. It is only the beginning of a much larger move.
> 
> This is where I seem to by picking up much of my 6R-10R wins. Thoughts?




Pav, 

In your Wyckoff reading you should have come across a theory which mentions a relationship between the width of this type of base and the eventual height attained in price. Check it out, you may find an advantage to assist you.
I could give you the info but you will appreciate the discovery much more by working it out yourself


----------



## pavilion103

Mistagear said:


> Pav,
> 
> In your Wyckoff reading you should have come across a theory which mentions a relationship between the width of this type of base and the eventual height attained in price. Check it out, you may find an advantage to assist you.
> I could give you the info but you will appreciate the discovery much more by working it out yourself




Maybe it is something I have overlooked. I'm not sure!
I haven't read anything about a tighter range leading to more spectacular gains.

Maybe I've overlooked this in my reading. 

It seems that this is the case though from my experience. If you say this theory is part of Wyckoff then no doubt I will come across it as I read more of his work.


----------



## tech/a

*PAV*

Just further and on a different angle to Mistagear
You an I have chatted with regard to control volume bars.
You'll note in a very large number of these potential parabolic 
Rises (70%+) ----- price remains within the range of the control volume bar.


----------



## joea

I think 2012 will see a number of new books concentrating on price and volume and/or price action.
Software and addins are now available to some degree, however I believe this will accelerate in the next couple of years  to take advantage of trading education promotions. 

I am sure Gavin will be in the thick of it.

One wonders if the "smart money" changes it's tactics slightly.
joea


----------



## pavilion103

I haven't done one of these for a while. 

This chart looks like an interesting one too me. Summary of analysis marked on the chart. 

Entry 0.032, Stop 0.027 (very low liquidity)


----------



## pavilion103

Another one. AZG

My opinion would be the following:
Entry 0.15 
Stop 0.13


----------



## skc

Hi Pav, have you ever compiled some statistics for your trade setups here? 

Re: AZG... probably the wrong sector (engineering services) to be looking for a breakout continuation. Your stop at 13 can be easily tagged if you look at the market depth and how it trades.


----------



## pavilion103

skc said:


> Hi Pav, have you ever compiled some statistics for your trade setups here?
> 
> Re: AZG... probably the wrong sector (engineering services) to be looking for a breakout continuation. Your stop at 13 can be easily tagged if you look at the market depth and how it trades.




I have 3 main setups. 

Since I went live I mark either a 1,2 or 3 next to each trade I enter so that I can analyse them separately. Once I've got a decent sample size I will be doing some statistical analysis. 
With these types of trades there can be some big R-multiple winners. Overall they would be my best setup.

Appreciate your thoughts on this one. I'll be interested to track.


----------



## skc

pavilion103 said:


> Another one. AZG
> 
> My opinion would be the following:
> Entry 0.15
> Stop 0.13
> 
> View attachment 49756




Takeover speculation on these guys. 

http://blogs.wsj.com/dealjournalaus...es-civmec-in-talks-to-buy-australias-allmine/

In this instance, the chart activities showed information that isn't available to Joe public.

Gapped open at 16.5c and now in a halt... so not sure if you'd get a fill depending on your entry criteria.


----------



## pavilion103

I wasn't filled on AZG when it gapped up. My limit was at 15c. I cancelled my order once it gapped up. 
I haven't studied patterns like this one much, so I think it's best for me to be out. 

CSS I still like. Same issue with this originally when I had a buy-stop at 0.027 and it gapped and I wasn't triggered. I had to wait for it to consolidate and got in at 0.032. Initial stop 0.027. So I'm 1.4R in profit at present with my trailing stop at breakeven. 

It will be interesting to see if it breaks up again now that it has consolidated close to 0.040 on decreasing volume.


----------



## tech/a

Why did you cancel the order you would hav been filled.?


----------



## pavilion103

tech/a said:


> Why did you cancel the order you would hav been filled.?




I guess a lack of experience in this type of scenario had me wanting to be out of the trade if I didn't know what I was doing. 

The way I saw it is that it was a great trade setup with a buy at 15c. It gapped up to 16.5 and then there was an announcement. I thought at that point I would cancel my trade. I didn't know what to expect. It then fell back down to 15c which would have taken me in. 

To be honest, I look at the chart now and I cannot read it. I thought that if I cannot read it, I had better not be in it. 

Is there anything you want to add?


----------



## tech/a

> Is there anything you want to add?




In your case you did the right thing



> I look at the chart now and I cannot read it. I thought that if I cannot read it, I had better not be in it.




So to reading the chart

*Click to expand*


----------



## pavilion103

Thanks Tech. Will save chart.


CSS out at 0.036


----------



## pavilion103

Thanks for the other chart Tech


----------



## tech/a

Update

Inside day on fair volume
No change to planned trade.


----------



## tech/a

Nothing has changed technically here so trade is still as started
Stop .14c and buy .155c


----------



## tech/a

This is a stop for me now.
Would keep on my watch list to see if it builds toward new highs or
fizzels down in price---at which time it would be culled from my watch list.


----------



## PinguPingu

Checked my 'simulated' watchlist/portfolio, had a buy @79.5c for LNC...


----------



## pavilion103

One that I am considering taking. 

Very high RR potential trade. I'll place a limit entry at 0.135 with a tight stop at 0.13. I'll take a very small position. 

0.135 appears to be an area of good support. A base has formed in the background, and I like the price action following the 15/1/2013 breakout on high volume.


----------



## pavilion103

DYE I like this one too. It's broken above the resistance at around the 0.16 area on ultra high volume and pulled back to this area. on much lower volume. 

Maybe enter 0.175 stop 0.155. Maybe enter on open.


----------



## pavilion103

APZ - a good entry at 0.235? stop around 0.21


----------



## pavilion103

UNS - buy around 0.40-0.405, stop at 0.335


----------



## tech/a

Pav

Just one observation

You tend to take breakouts from areas of long term rectangular basing patterns.
If you take a look at some(all) of the charts we have been working with (off forum) you'll note 
That I like to trade breakouts and potential breakouts from* MICRO* patterns.

This is an example we have been and are still trading.

Click to expand



I think its worth considering when looking for good potential trades and most definitely when adding to a trade (pyramiding) which you know I like doing on the way up not down!

Here is the same chart a few days further on.
Note the brilliant *MICRO* pattern

Really tight and hardly any risk.

Click to expand



*MICRO* patterns tend to be the spring mechanism.
Gaps up out of them with or without volume show
reliable strength in the breakout. Basically a quantifiable
break *OUT* of the pattern.


----------



## tech/a

Another good example I have just found.
Just something to look for.


----------



## cbc1

We think alike tech.....

Sooooooooooooo many times I have traded this pattern. 

Again and again and again.........


----------



## Gringotts Bank

The flag.  High tight flags have the highest success rate of any pattern.  See Bulkow


----------



## tech/a

Its only one pattern.
I like among others.
*Small* 
Rectangles
Triangles
Pennents
Singular extremely low volume bars in a
cluster bar pattern (Hard to explain but I know what I mean).

*ALL of these patterns must remain in the top half of the current thust in the direction of the trade.*


----------



## cbc1

Um yea tech,

I havn't been trading that long and only trade micro breakouts.

Il take your word for all those other patterns.


----------



## pavilion103

Another one I'm looking at.

AMM

- Trending to an all time high
- Tight micro consolidation pattern on very low volume
- Consolidating just above that enormous volume bar
- Strong relative strength to XAO (not sure how significant this is)

I've got a very tight entry @ 1.905 (above 20/3 and 21/3) and stop at 1.84 (below 20/3 and 22/3). I'm not sure if I'm jumping the gun and this needs to consolidate anymore. I could probably move the stop down? But this looks like a high RR opportunity.


----------



## tech/a

PAV

My thoughts Just a little loser on the trigger and stop.
Plus a what if clause.

*click to expand.*


----------



## tech/a

Another Perhaps

*Click to expand*


----------



## pavilion103

Tech, I've been analysing the trade management from our portfolio which is painting a clearer picture for me. 

I have a question in relation to this: In a market that is now not trending upwards smoothly like the last few months, how does this impact trade management?
If one of these is triggered, am I looking to move my stop higher (or to breakeven) more quickly because stocks are less likely to go on with it in these broader market conditions?
Or does the trade management remain relatively similar?

I know we can discuss this bar by bar over email but what is the general 'rule' you would use.


----------



## pavilion103

tech/a said:


> Another Perhaps
> 
> *Click to expand*
> 
> View attachment 51460




An observation with this one is that it is not in an established uptrend. Why choose this one?

Consolidating near the top of the high volume around 31/8/12 bar. 

What significance (if any) do you place on the relative strength of this stock at a time when the market has been falling lower in the previous 2 weeks?


----------



## tech/a

PAV 
Will answer your questions later.

I would discard AMM as pattern has failed.
APN remains as yesterday.
There is a number of general " rules "
which I'll run through when more time.


----------



## pavilion103

Yes, AMM cancelled after trading yesterday.

There seems to be more consolidation patterns (mainly flags and triangles) appearing in my scans.


----------



## Boggo

pavilion103 said:


> There seems to be more consolidation patterns (mainly flags and triangles) appearing in my scans.





Does this fit your criteria ?

(click to expand)


----------



## tech/a

-------

*CLICK TO EXPAND.*


----------



## pavilion103

I'm actually in CCV. I entered today (one of two positions that I'm currently holding).

Interesting with those 'tails' Tech. I've been thinking about them a little. 
There were a few on "The Chartist" recently that got stopped out with these long tails that came back and closed on the high, and then continued to proceed upwards (e.g. IAG, CCV and a few others, also FXJ that we traded).
I had written down this as a question to ask actually! (whether to enter after one or if I should be waiting for it to breakout again first).


----------



## pavilion103

Another one.

Apologies for the messy chart. The lines represent previous areas of resistance that I'd put in for my benefit.

I'd identified this one previously at the triangle (green). Now a flag forming right above the high volume area and previous resistance. Might be worth a look....


----------



## tech/a

*AMM follow up*

Click to expand

*

*


----------



## tech/a

Just a look.

*Click to expand.*


----------



## pavilion103

PMP is one that I came across in my scans this afternoon. I'm glad you brought this up. 
My scan is fairly basic at present. Highest high of 40 bars and I scan the last week. I add anything of interest to the watch list. 


Would you have your stop under the low of today? Or closer to the bottom of the control bar?
With a tight stop this looks like a high RR potential trade.

I haven't looked at heaps around this price range lately (looking closer to $1 and over mainly). Is this one you'd throw into the portfolio or a bit more speculative (is that what you meant by 'just a look')?


----------



## barmix

Hi Tech/a

As Pav asked early - does the trend of the index having any bearing on if you will take a trade? Also does the index trend have any bearing on where you place your stop loss?

thanks
barmix


----------



## pavilion103

Boggo said:


> Does this fit your criteria ?
> 
> (click to expand)




CCV looking good. I'm glad I'm on this one.

Did you get on Boggo?


----------



## Boggo

pavilion103 said:


> CCV looking good. I'm glad I'm on this one.
> 
> Did you get on Boggo?




Added to my holding that I had from 18/02.

Been stopped out on those tails a couple of times since last Oct but keep coming back.

Some similiar behaviour to CRZ and SKE all the way up


----------



## tech/a

barmix said:


> Hi Tech/a
> 
> As Pav asked early - does the trend of the index having any bearing on if you will take a trade? Also does the index trend have any bearing on where you place your stop loss?
> 
> thanks
> barmix




In terms of time frame to a degree.

If the index is nearing the end of a prolonged move as it is now
then my expected time frame for a trade will be shortened and my 
positioning of stops both initial and trailing will be tighter.

The stock being traded "generally" reflects similar characteristics to the index in terms of its maturity in a trend.
It will tend to make lower highs and consolidate at tops.OR you will see a blow off top.
You will see buying removed and selling over whelm buying.

On the other hand if its coming out of or in the middle of a trend then the trailing and initial stops will tend to be wider.
My one rule---as there is always prospects
Get that stop to B/E as soon as humanly possible.
Sure Ill get taken out prematurely--particularly like now near "Perceived and anticipated" tops.
But no biggie my portfolio remains very stable with very little drawdown.

Youll also note a* BUY *trigger on my trades.
This widens as the market gets weaker--- I want it to prove strength.

PAV has noticed this---I'm sure in the exercise.


----------



## pavilion103

PMP 

Another day of consolidation. Interesting to note that the low at 0.22 represents the low of the previous 3 days. Take a look at the red line in the chart below: there were 4 bars with a high at 0.22 prior to the strong volume break on 21/3. 

Is this worth a crack? Stop loss at 0.21 or so.


----------



## tech/a

You can see where my buy is above.


----------



## pavilion103

I took a half position in this one -- 1% risk 

(Pending trade - buy 0.235, stop 0.215). Good RR potential.


----------



## pavilion103

CCV


----------



## pavilion103

PMP having a strong day today up around 18% at the moment. 

I'm still in this one. Bought 0.235, Currently 0.30. Will post charts when I get time.


----------



## pavilion103

PMP was out at 28c. 


I don't have any new setups to list tonight but thought I'd come back on here. 

I've recently traded some of the telcos. 

I turned on Sky Business Channel (which I don't usually watch) and the first 3 analysed stocks from callers were:

AMM, MTU and TPM. These are three with trailing stops that I just had taken out in the past 1-3 days. 



If there are more setups that start to appear I'll get this thread up and running again and maybe go over 2 or 3 at a time.


----------



## CanOz

pavilion103 said:


> PMP was out at 28c.
> 
> 
> I don't have any new setups to list tonight but thought I'd come back on here.
> 
> I've recently traded some of the telcos.
> 
> I turned on Sky Business Channel (which I don't usually watch) and the first 3 analysed stocks from callers were:
> 
> AMM, MTU and TPM. These are three with trailing stops that I just had taken out in the past 1-3 days.
> 
> 
> 
> If there are more setups that start to appear I'll get this thread up and running again and maybe go over 2 or 3 at a time.




What about shorts, will you be looking at those if they appear?


----------



## pavilion103

CanOz said:


> What about shorts, will you be looking at those if they appear?





On the short side I've been mainly looking at the broader market. I've been looking to the futures indexes as a way to short and take a position for a bit longer term than my usual setups. 

I'll still keep an eye out for anything that comes along.


----------



## pavilion103

Here is an interesting one. 

In a market where most stocks have been falling, this one has recently consolidated in a triangle pattern on declining and low volume. 

Something has happened in the last couple of days. Look at the volume. Usually I like a break on low volume (no supply) but this is interesting. 

Entry: 1.04
Stop: 1.00


----------



## pavilion103

A different type of trade. Only a small position for these types of ones. 

Buy: 0.27
Stop: 0.185


----------



## fiftyeight

Hey Pav,

Have just read through the thread and quickly over the tradeguider threads. Your posts have switched from amibroker to tradeguider.

Is this what you are mainly using now?
How did you find as an educational tool?
How are you finding it live?

Cheers


----------



## pavilion103

fiftyeight said:


> Hey Pav,
> 
> Have just read through the thread and quickly over the tradeguider threads. Your posts have switched from amibroker to tradeguider.
> 
> Is this what you are mainly using now?
> How did you find as an educational tool?
> How are you finding it live?
> 
> Cheers




I've used Tradeguider for some time. 

I started posting charts on here with Amibroker before I got Tradeguider. 

Currently:
- I use Amibroker for my scans and watchlists. 
- I use Tradeguider to bring up charts to analyse in more detail


As mentioned on this forum Tradeguider is a good tool for those who want to learn VSA. The signals can be clicked on and you can read a more detailed description of them. They alert you to certain things that are occurring. 

These signals are NOT to be used as entry and exit signals. It doesn't interpret the chart for you. It simply points things out and then you must apply your own VSA analysis to make sense of what these signals mean in the context of the broader picture (not in isolation).


----------



## Gringotts Bank

pavilion103 said:


> I've used Tradeguider for some time.
> 
> I started posting charts on here with Amibroker before I got Tradeguider.
> 
> Currently:
> - I use Amibroker for my scans and watchlists.
> - I use Tradeguider to bring up charts to analyse in more detail
> 
> 
> As mentioned on this forum Tradeguider is a good tool for those who want to learn VSA. The signals can be clicked on and you can read a more detailed description of them. They alert you to certain things that are occurring.
> 
> These signals are NOT to be used as entry and exit signals. It doesn't interpret the chart for you. It simply points things out and then you must apply your own VSA analysis to make sense of what these signals mean in the context of the broader picture (not in isolation).




Amibroker has a good VSA code for free, including bar-by-bar descriptions.

Example:


----------



## tech/a

Gringotts Bank said:


> Amibroker has a good VSA code for free, including bar-by-bar descriptions.




Like every reversed engineered version of most things
some are accurate and most are accurate every now and again.

The many VSA patterns are derived from multiple bars and volumes.
and as such missed in reverse engineering.

Where most go wrong with VSA is as Pav has pointed out
but Ill go a little further in that their application of VSA lacks!

Ive used VSA since Gavin Holmes took it on. ( Trust me as an Ex Cop in the UK Gavins BEST ANTICIPATION was the populatity of VSA and his relentless ability to market a winning product).

VSA is a powerful tool as is a lot of chart reading not seen by VSA exponents.
If you look at enough charts youll find a few.

*APPLICATION* is the key.
Knowing *HOW* to trade is the Door


----------



## fiftyeight

Yeah by reading the forums, tradeguider is just that another resource to use as a "guide" in conjunction with everything else.

As first indicated my first few posts I am very new. The only thing I have learnt is how much I dont know. I have not really started any education yet, I am just trying to figure out what I want to focus on. Even this has taken me a while to decide haha

Cheers GB. Bit worried about inaccurate software when first starting out as I may not/probably not be able to identify the false and missing signals. Dont suppose you have run some of the free software and compared it against tradeguider to see how they compare?


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## Gringotts Bank

fiftyeight said:


> Cheers GB. Bit worried about inaccurate software when first starting out as I may not/probably not be able to identify the false and missing signals. Dont suppose you have run some of the free software and compared it against tradeguider to see how they compare?




I don't have TG to do a comparison, but the guy who wrote the free script put a heck of a lot of work into it.  It does do some multi-bar analysis too.

Available here, for AB:

http://www.wisestocktrader.com/indicators/3044-volume-price-analysis-v2-fix

One thing I have done with this code in the past is take all the bullish signals possible for VSA and backtest them individually with various filters and stops, and they mean nothing.  I even looked at combinations such as "test for supply followed by upthrust bar" and found nothing that could be run profitably.  But maybe if you look at say 20 bars and take all that together along with a whole bunch of other factors....maybe that can work.  But small groups of signals, no.


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## tech/a

fiftyeight said:


> Yeah by reading the forums, tradeguider is just that another resource to use as a "guide" in conjunction with everything else.




One of the few which can be used as a stand alone.



> As first indicated my first few posts I am very new. The only thing I have learnt is how much I dont know.




You have learnt more than most.



> I have not really started any education yet, I am just trying to figure out what I want to focus on. Even this has taken me a while to decide haha




Learn HOW to trade.
What you use in that endeavor is of little importance if you dont know how to acheive more Reward for Risk



> Cheers GB. Bit worried about inaccurate software when first starting out as I may not/probably not be able to identify the false and missing signals. Dont suppose you have run some of the free software and compared it against tradeguider to see how they compare?




Thats how the differences were found!


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## pavilion103

Similar to what I was trading in the rising market. Not sure how this will fare in current condition.


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## tech/a

pavilion103 said:


> Similar to what I was trading in the rising market. Not sure how this will fare in current condition.
> 
> View attachment 52790




Thought Id post my email reply here as well Pav




I place quite a weight on where the price action is relative to the life of the chart.

Here is the weekly.
Nice confluence!


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## pavilion103

Much appreciated.

Good to look at the EW


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## fiftyeight

When you say learn HOW to trade, are you referring to subjects similar to what is covered in "Universal principles of successful trading"?


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## tech/a

fiftyeight said:


> When you say learn HOW to trade, are you referring to subjects similar to what is covered in "Universal principles of successful trading"?




Yes thats a good start as is Radges Unholy Grails.

But unfortunately as simple as it is it is in itself complex for each of us.

There are 3 ways to make a profit (That I know of).
(1) Many more wins than losses where the accumulated wins exceed the accumulated losses.
OR
(2) Much larger wins where the Larger wins exceed the accumulated losses.
OR
(3) A combination of both.

All of course are positive expectancy.

*If you dont know what you put in place day in day out to acheive that then you dont know how to trade.*

Your gambling--punting.

Then there are all the aspects which amplify success.
The 80/20 Rule.
Leverage and its proper use.
The power of compounding.
Correct and ample capitalization.


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## fiftyeight

Cheers Tech, we all must start somewhere and hopefully find our way to profitability. Those 2 books should be on my door step any day.

Enjoying this thread, the charts dont mean to much to me yet but I am starting to see "something" after it has been pointed out, cheers guys


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## pavilion103

I didn't end up taking this one because of the above posts. Dangerous time to be playing around with these. If I had I'd probably look to move the stop up to below this bar (break-even) because of the high level of risk. 

Either it goes on with it or it doesn't. Maybe also the psychological factor of $10 could have an impact. Note the high of today was 9.99


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## tech/a

pavilion103 said:


> I didn't end up taking this one because of the above posts. Dangerous time to be playing around with these. If I had I'd probably look to move the stop up to below this bar (break-even) because of the high level of risk.
> 
> Either it goes on with it or it doesn't. Maybe also the psychological factor of $10 could have an impact. Note the high of today was 9.99
> 
> View attachment 52847






pavilion103 said:


> I didn't end up taking this one because of the above posts. Dangerous time to be playing around with these. If I had I'd probably look to move the stop up to below this bar (break-even) because of the high level of risk.
> 
> Either it goes on with it or it doesn't. Maybe also the psychological factor of $10 could have an impact. Note the high of today was 9.99
> 
> View attachment 52847




Ignore what others say.
You had and still have a profitable
Plan. As it has panned out you would now
Be at B/E  
It was a good setup.
Supply isn't yet that evident.

How did you find that one?
Nothing coming up on my scans


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## pavilion103

tech/a said:


> Ignore what others say.
> You had and still have a profitable
> Plan. As it has panned out you would now
> Be at B/E
> It was a good setup.
> Supply isn't yet that evident.
> 
> How did you find that one?
> Nothing coming up on my scans




Simple scan this one. Any stock that has made the highest high of 40 bars in the previous week. 

I always go back 5 trading days to see how price has responded at these new highs e.g. consolidation/no supply.


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## pavilion103

The reason I got so excited about this one is because it's the only bloody one that has come up for a while!!!

Was great when our scans were bringing these up frequently!


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## CanOz

pavilion103 said:


> The reason I got so excited about this one is because it's the only bloody one that has come up for a while!!!
> 
> Was great when our scans were bringing these up frequently!




I remember the times when Nick's power setups were bringing me more trades than I had capital for...I think the max number of positions I had open at the time was like 18 or something, too much for me when i was working fulltime.

It was a good run then though.

CanOz


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## pavilion103

CanOz said:


> I remember the times when Nick's power setups were bringing me more trades than I had capital for...I think the max number of positions I had open at the time was like 18 or something, too much for me when i was working fulltime.
> 
> It was a good run then though.
> 
> CanOz





Well that has posed a bit of a dilemma for me during those good times. 

1) Do I take 1.5-2% fixed fractional positioning as my account size increases

2) Do I use a lower fixed fractional percentage of account and take as many trades as capital allows i.e. more diversified. 


So far I've taken option 2, but not sure how extreme to take this.


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## CanOz

pavilion103 said:


> Well that has posed a bit of a dilemma for me during those good times.
> 
> 1) Do I take 1.5-2% fixed fractional positioning as my account size increases
> 
> 2) Do I use a lower fixed fractional percentage of account and take as many trades as capital allows i.e. more diversified.
> 
> 
> So far I've taken option 2, but not sure how extreme to take this.




From memory I think Nick had recommended keeping the risk the same, say 1% and just adding to a maximum of 10-15...

They can get a bit tricky to manage when they're over twenty positions and you risk allot of portfolio heat in a surprise event, also you risk making mistakes the more positions you have on too. 

What's techs view?

CanOz


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## tech/a

pavilion103 said:


> Well that has posed a bit of a dilemma for me during those good times.
> 
> 1) Do I take 1.5-2% fixed fractional positioning as my account size increases
> 
> 2) Do I use a lower fixed fractional percentage of account and take as many trades as capital allows i.e. more diversified.
> 
> 
> So far I've taken option 2, but not sure how extreme to take this.




I'd work at it differently.
I want to be on the trades that are running with momentum.
Rather than having more trades with less on each---your diversification is going to decrease risk but take away leverage by diluting capital in trades that are out performing.

Leave some capital aside so you can pyramid.
You have seen the dramatic difference to your portfolio
When you get it right and the way to squash risk if your
Trade goes pear shaped.

If you think about it you know what to do!


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## pavilion103

tech/a said:


> I'd work at it differently.
> I want to be on the trades that are running with momentum.
> Rather than having more trades with less on each---your diversification is going to decrease risk but take away leverage by diluting capital in trades that are out performing.
> 
> Leave some capital aside so you can pyramid.
> You have seen the dramatic difference to your portfolio
> When you get it right and the way to squash risk if your
> Trade goes pear shaped.
> 
> If you think about it you know what to do!




I certainly agree that I don't want to sit there with a bunch of trades in no man's land, chewing up precious capital.

There were a few really good ones that we hit hard with pyramiding and made a good profit from. 

Even when I've looked through Radge's in the past, there are some that stand out to me and I get on them, there are others that are larger patterns, or just don't look like they have the explosive potential to some of the ones we've traded in the portfolio.


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## pavilion103

MFG would be out at break even. 

Now that is an example of getting on an opportunity and then minimizing risk.


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## tech/a

pavilion103 said:


> MFG would be out at break even.
> 
> Now that is an example of getting on an opportunity and then minimizing risk.




No harm done to the account.
No longer at risk.
No wondering.
No psychological issues.
*NEXT!!!!*


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## pavilion103

A whole new question but a question that first crossed my mind when we traded the telcos TLS AMM MTU ....

Taking the opposite side of the trade appearing to top out? I know short setups differ from longs but worth considering maybe. 

With the telcos or banks recently I had longs and got out as it looked toppy. Shorting them in conjunction with XAO analysis would have been smart. 

Could work for others...


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## tech/a

pavilion103 said:


> A whole new question but a question that first crossed my mind when we traded the telcos TLS AMM MTU ....
> 
> Taking the opposite side of the trade appearing to top out? I know short setups differ from longs but worth considering maybe.
> 
> With the telcos or banks recently I had longs and got out as it looked toppy. Shorting them in conjunction with XAO analysis would have been smart.
> 
> Could work for others...




Of course you can.
If you wish.


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## pavilion103

Might be worth me looking into in a bit more detail. Things can fall quickly. 

I'll analyze taking the opposite trade vs waiting for a test.


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## Boggo

pavilion103 said:


> Might be worth me looking into in a bit more detail. *Things can fall quickly*.
> 
> I'll analyze taking the opposite trade vs waiting for a test.




SKE could be a good recent example of where that could work, the faster they run the harder they (can) fall.
https://www.aussiestockforums.com/forums/showthread.php?t=16501&p=766395&viewfull=1#post766395


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## pavilion103

MFG!!!

We identified that it was going against the trend. But we're also very cautious.

Look at today's action!


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## pavilion103

Could have always had a setup for a break of the larger triangle which formed, but generally not looking at these types of trades right now.

Just posted out of interest.


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## pavilion103

My best trade of the last month = RCR

Not many are taking off like this one. 

My entry was a tight consolidation above a significant high volume area. 

Entry 2.73
Stop 2.58
Current 3.30

Defying the general market. Stops trailed in pink on the chart below. 




- - - Updated - - -

Another to watch


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## pavilion103

RCR





IPP




- - - Updated - - -

I'm only holding 3 at the moment. 
RCR, IPP and the third is SXL


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## pavilion103

3 more setups that I have entered tonight.


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## pavilion103

This was the best of them today - SXL - moving up on low volume, possibly indicating no supply. 
It has just cleared major resistance.


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## tech/a

Watch this!


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## pavilion103

Wow. Something going on there. 

The added bonus for this one is the opportunity cost of capital because the percentage gap between an exit and entry is relatively large.


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## tech/a

*Well look at that*

*

*


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## pavilion103

MNW is in a trading halt pending some announcement regarding a transaction. 

Hopefully it is big (and good) news!


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## pavilion103

Up 45% on open. 
Let's see how it goes throughout the day. 

Glad you put this one up Tech, I hadn't noticed it in my scans. Got in just in time on the day of the trading halt.


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## pavilion103

Tech, a question for you specifically and I'll ask it here for the benefit of the whole site. 

MNW. Up 70% for the day. 

How would you trade this from here? 

Is this one that you would sell on the next open? Or some other way of trailing it?

In your experience, how do ones like this react after a big move like today?


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## tech/a

pavilion103 said:


> Tech, a question for you specifically and I'll ask it here for the benefit of the whole site.
> 
> MNW. Up 70% for the day.
> 
> How would you trade this from here?
> 
> Is this one that you would sell on the next open? Or some other way of trailing it?
> 
> In your experience, how do ones like this react after a big move like today?




This will reverse viciously.
I've traded quite a few that do this---never with enough!

This is how I would play it.

If on Monday it looks like gapping up on open.

*(1)* Trailing stop at the high of today.

Then Id have a sell stop (EXIT) 2 ticks above the price it is likely to open at.

*(2)* If it looks like opening below todays close then sell at open.

It wont continue vertically
It will reverse strongly--you will learn a lot from that reversal.
You'll notice there is no hold strategy.
It will happen very quickly.

Enjoy.


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## skyQuake

tech/a said:


> This will reverse viciously.
> I've traded quite a few that do this---never with enough!
> 
> This is how I would play it.
> 
> If on Monday it looks like gapping up on open.
> 
> *(1)* Trailing stop at the high of today.
> 
> Then Id have a sell stop (EXIT) 2 ticks above the price it is likely to open at.
> 
> *(2)* If it looks like opening below todays close then sell at open.
> 
> It wont continue vertically
> It will reverse strongly--you will learn a lot from that reversal.
> You'll notice there is no hold strategy.
> It will happen very quickly.
> 
> Enjoy.




Looks good tech. Never thought about having a conditional strategy in place like that.

Personally, I would sell the day before the instos get their cheap 10c placement stock. Though there is no Appendix 3B we have no idea when that comes on...

gl with the trade


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## pavilion103

Dammit. Wish I had held. Up to 35.5c as of this morning. 

Thinking there might be some benefit in just holding those types of stocks a bit longer term and trailing new lows. I've seen some really take off. 

A couple of low priced ones I'm watching include: RIA, ABN, GRB


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## tech/a

It reversed to 22 c then started to move up again on increasing volume.
There was plenty of time to enter this stock after the initial impulse move was validated.

If you wish to enter it you have 3 options.
Wide stop or pull back or No stop.


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## pavilion103

A couple of interesting ones to watch. I'm in both of these. Interesting to see if they turn down if the market does. 

All my stocks are in profit at the moment. This little run has been good. Not sure how much longer it can go though!

Green = entry
Red = initial stop
Pink = trailing stop


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## pavilion103

Out of those now. 



Not sure if others are finding this too, but trading a momentum strategy I am noticing a few setups appearing. I've got quite a few pending orders with setups based on tight consolidations on declining volume. Interesting time!


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## pavilion103

I'm posting these in the hypothetical trades because I didn't post these all in real time. 

Although if you check each of the individual stock threads I did!

Not sure where else to discuss this. 

The interesting discussion point for me here is that I've had a great start to the year with my ASX momentum setups but have only taken 8, well selected trades. I've identified my best setups and taken them and left everything else alone. I'm not too bullish about overall market conditions. 

Here is a summary: note this is not my actual account size. I always post with a hypothetical $50,000 account so don't read anything into it. 




- - - Updated - - -

Charts of note. 

Active trades - AAD and BLD


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## pavilion103

Closed trades - TFC, TGZ, GEM


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## pavilion103

Not sure if there would be interest for a thread trading this in real time on the forum?

Because I am taking so few trades it isn't as time consuming as the one with Tech last year. 

I've taken a total of 8 trades for the year. 
I am mainly focusing on FTSE futures as can be seen in the Transition to Futures Trading thread. 

My strategy is to pour those profits into this portfolio. 

If there is any interest for a separate thread let me know. 
I didn't want to just go ahead and create one.


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## Wysiwyg

pavilion103 said:


> Here is a summary: note this is not my actual account size. I always post with a hypothetical $50,000 account so don't read anything into it.



Regardless of simulation, would it not be better to trade as if real time? For instance the TFC buy of 105263 shares at .99 has the wrong total position dollar value and I notice the position sizes for all trades range from 35k to 191k though I assume the risk per trade is the same.

Quick check = Yes the risk per trade is 5k.


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## pavilion103

Ah...
What have I done?
I'll have a look and fix it. Sorry.


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## Lone Wolf

pavilion103 said:


> Not sure if there would be interest for a thread trading this in real time on the forum?




I think the more actual trading threads we have on here the better. So if you want to do it I say go for it. So long as the time taken to do so isn't detrimental to your trading.


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## Newt

Hmm, I'm finding my path crossing yours again Pav.  I spent quite a few hours today dissecting my trend trades over the last 18 months for periods where they could have been taken as momentum plays.  By reviewing ATR multiples above the long term lower (supporting) trend line, along with dips in short term ATR, I've found some interesting options for optimising entries.  This post from Peter got me thinking along these lines originally by the way (post#7):
https://www.aussiestockforums.com/forums/showthread.php?t=27976&highlight=premature+exits

Playing with my spredsheet and 20/20 hindsight has been somthing I've meant to do for weeks.  Well, interesting for me, perhaps old hat for the experienced.  Really just gobblidook for periods of surging price momentum tend to follow periods of consolidation.  Do I get the nobel prize for stock picking yet?  

Anyway, I think this is important bread and butter stuff for trend/momentum traders and you should keep at it.  I'm will to put a few up after the fact too.


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## pavilion103

Another setup. 
Scan returns 95 results. 
Only like 1!

Not the time to be going crazy!


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## pavilion103

That last setup cancelled.

AAD and BLD continue to move. Up another 2.5% so far today.


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## Wysiwyg

pavilion103 said:


> That last setup cancelled.



Breakout on the 24th was fruitful. These stocks don't overreact to downward market movement. Have to admit I have never tried this strategy for fear of being caught holding the hot potato.


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## pavilion103

Wysiwyg said:


> Breakout on the 24th was fruitful. These stocks don't overreact to downward market movement. Have to admit I have never tried this strategy for fear of being caught holding the hot potato.




I usually just don't trade them in a down market. I've stroll got AAD and BLD but not looking to take any more.

A nice run with some of these stocks over a couple of months but now I'm pulling out. 

I've found that by preserving capital during challenging times, overall returns are boosted.


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## pavilion103

A month since my last post. 

Market conditions are still no more favourable. 

Looking to get active again with stocks once the general market looks stronger. 

In the meantime trading the FTSE both ways (mainly short). 


I miss trading stocks at the moment! But like I said before, preservation of capital is important.


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## pavilion103

Given the potential support level here on the XAO I might have a look at a few stocks again with the plan of holding for a couple of weeks if it pushes up. 

If anything interesting comes my way I will post up some charts.


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## pavilion103

WEB
CNU
AAD

I took those ones yesterday that I posted in the potential breakouts thread.

All triggered and negative yesterday. I'm hoping that the market pushes up today.

I prefer strong bull trends to trade stocks but figured thee may be some small profits to make in the next week or two.


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## debtfree

Hi Pav,

Did you get more of a feel that our market (even though many had thought we were due for a bit of a bounce) was heading up (short term) because of your FTSE trading and watching the DAX?

If your thoughts are that our market might be ok for just a week or two, have you or do you move your stop loss to B/E sooner than normal or do you stick to the same routine?

With this in mind I thought with AAD & CNU moving upward do you make a move on them today to B/E in case this is as far as the market runs or do you give it the same space as normal?

Thanks Pav .... Debtfree


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## pavilion103

It's not the initial stages of the trade that will change as much as the ongoing trade management as it moves into profit. 

Stops certainly moved a little now but I'll trade as usual but be more aggressive taking profits if the XAO looks bearish.


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## debtfree

Thanks for your reply and thoughts Pav, will watch with interest going forward.


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## Evolve

Hey Pav,

CNU is dual listed on the NZX/ASX exchange and is alot more liquid on the NZX listing which may be of use for anaylsis. Not sure if it's relative to your trading but thought id just let you know.


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## pavilion103

Evolve said:


> Hey Pav,  CNU is dual listed on the NZX/ASX exchange and is alot more liquid on the NZX listing which may be of use for anaylsis. Not sure if it's relative to your trading but thought id just let you know.




Thanks mate. Appreciate it.


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## wombat40

Go ardent


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## wombat40

yea...look like its orf again...


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## pavilion103

All 4 are looking good. 

Interesting to see if 1 or 2 of them takes off.


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## debtfree

Nice work Pav, congrats


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## pavilion103

CNU doing brilliantly. This is my best. 

IFM doing well. 

WEB looks like a shakeout bar today. 

AAD a very large drop. Possibly a big shakeout bar if it closes near the high but I'm not convinced.


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## pavilion103

Have renewed my ASX stocks date for the first time in 9 months!!!! wow. 
The trades I took in December were ones someone ran past me.

I'm excited to have a look at these again. I love trading stocks. 
The breakout momentum strategy is a good one and I need to get back into the swing (whether I take trades right now again or not). 

The thing I love about this is how low effort it is. 
Scan....select charts I like and put on watchlist.... place setups... move stops each night... simple. 
Unlike futures where you are making decisions at the screen this is much more passive. 

I'll take a look and see if I come across anything and if I do I'll post.


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## pavilion103

I'll be watching the XAO market direction closely. 


Some selections. 
1. Speculative. Good setup. 
2. Speculative. Avg. setup. 
3. Micro setup.


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## pavilion103

First chart that I posted was this one. Bouncing around a bit. Risky one.


----------



## pavilion103

Second chart cancelled order. Risky anyway. 

Third chart = PAN


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## pavilion103

Interesting one that I took yesterday. It pulled back later in the day.


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## pavilion103

Watching a bunch including:
AGI
GOR
SBM
RSG
AJX
SXY
MNY
AGF

Some are better than others. 
Some have some nice accumulation bases which have formed. 

Too much effort to post all the setups and cover up the names on the charts. 

I'll look to contribute more heavily to this thread if things really get interesting in the next week or two. 

Hopefully that will spark some interest.


----------



## Nortorious

pavilion103 said:


> Interesting one that I took yesterday. It pulled back later in the day.
> 
> View attachment 61477




This looks great on the weekly. Entry risk (with where I would put the stop) is about 29% on the initial position so sizing would be important but the high volume this week makes it interesting...


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## pavilion103

I am very much contemplating running a live stocks portfolio as Tech (with myself) had done a couple of years back.

I will sit down this evening and work out whether I have the time to maintain this. It will be pretty much what I am trading anyway. The only time consuming part will be posting the charts before each trade as well as updates. 

I am seeing good opportunity in the market and now.

I will determine my available capital and position sizing. 

I may start a new thread exclusively for that.


----------

