Australian (ASX) Stock Market Forum

Scalping Lynas experiment

Jump to new
Gringotts Bank

Gringotts Bank

Joined
30 June 2007
Posts
7,200
Reactions
1,226
To be profitable, one needs to buy within 1.5c of the low price (or less), then sell at tomorrow's open. That's a 3 price level window of opportunity. Can it be done?

It's basically a depth reading exercise. If it works, will yield 50-100% pa and extremely low drawdowns in bull/neutral conditions.

Paper trading to begin. I have bought $1.15, real volume, real time. I can't prove it, and I don't care. Neither should you!

A wider window exists if selling at close, up to 2.5c, but only in bull market conditions. Anyway I'll start with the method as is. Make it harder!
 
How do you know that your 1.5c from the low of the day?
If you have an open lower than your buy price what do you do?
Do you have a stop?
How do you manage risk?--whats the strategy?
How do you justify the 50-100% claim?

Wouldnt you be better off trying this at a support level rather than EVERY bar?

Like $1.10.
 
tech/a said:
How do you know that your 1.5c from the low of the day?
If you have an open lower than your buy price what do you do?
Do you have a stop?
How do you manage risk?--whats the strategy?
How do you justify the 50-100% claim?

Wouldnt you be better off trying this at a support level rather than EVERY bar?

Like $1.10.
Click to expand...

You read the tape, and if you're wrong, you're wrong, and you won't get your 50-100%. As I say, you have to be able to read the depth or you won't make those sort of returns.
O<C, no problem. O>C, no problem. Just read the depth.
Time stop only. EOD or tomorrow's open, and that is my risk management. I've done the sums on that.
50-100%? By backtesting.
 
Gringotts Bank said:
You read the tape, and if you're wrong, you're wrong, and you won't get your 50-100%. As I say, you have to be able to read the depth or you won't make those sort of returns.
O<C, no problem. O>C, no problem. Just read the depth.
Time stop only. EOD or tomorrow's open, and that is my risk management. I've done the sums on that.
50-100%? By backtesting.
Click to expand...

Why sell at tomorrow's open?
 
Anyone trying to trade LYC is competing with bots, shorters and manipulators on a grand scale. Until there is certainty regarding start up date this stock will continue to be the subject of much manilulation. To profit from trading LYC I find it necessary to buy after a couple of down days and be prepared to wait and hold until a price rise eventually shows up which gives a reasonable profit. There is no logic in the level of the SP from one day to the next.:2twocents
 
sky, you have to sell some time. Sell whenever you like.

You could put a .005 ProfitStop on it, but I can't backtest that without intraday data. Could work quite nicely, I expect.

Absolutely nioka, you're competing with churning and manipulating bots a well as other traders and short sellers. It's always like that, just harder with a short time frame. I chose LYC because it IS the traders stock. FMG a close second.
 
Gringotts Bank said:
sky, you have to sell some time. Sell whenever you like.

You could put a .005 ProfitStop on it, but I can't backtest that without intraday data. Could work quite nicely, I expect.

Absolutely nioka, you're competing with churning and manipulating bots a well as other traders and short sellers. It's always like that, just harder with a short time frame. I chose LYC because it IS the traders stock. FMG a close second.
Click to expand...

Alright, i read that as exit condition = tomorrow's open.

FYI, lynas trades in the US a bit overnight, so the next day's opening price is heavily influenced by where lynas closed in the US
 
tech/a said:
Will be interesting
Personally I think depth means little as sellers and buyers will hit at market.



Condition for sell.



When --how long.?
Click to expand...

Sell next open was the one and only sell condition. That's a time stop, is it not?

Buy is whenever you feel you want to pull the trigger. If you can get within 3 price levels of the low you will rake it in. If.... :) Big if!

This past year, the one year return is >300%. 50-100% for longer term, and that's with a $50,000 each trade.
BUT it only works in certain market conditions. The beauty is, the equity curve is VERY easy to trade.
 
OK so you need to buy within 1.5c of the bottom on ANY DAY?

Dont know how you can do that?

Then sell on next open.
 
Every day or every second day, yeh.

Well I did it today. I bought at $1.15 (L= 1.135).

That's the experiment. To see if it can be done.

I have a hunch I can do it. Requires a bit of screen time, but once you've pulled the buy trigger you can switch your PC off for the day.
 
So if (Hypothetically) it fell to say $1.12 (After you bought on the same day) would you sell on open still?
 
yep.

The hardest days will be those where you have to decide whether to get in at open, because you expect the open will be the low.

The easiest days will be the worst performing days.
 
Gringotts Bank said:
You read the tape, and if you're wrong, you're wrong, and you won't get your 50-100%.

I've done the sums on that.
50-100%? By backtesting.
Click to expand...

Hi I'm interested to know why LYC now ?
Currently volatility is just over 6%, only 5 times in the last 12mths has it reached this low level, average has been around 10% plus it's been from a higher price range.
Trouble with backtesting is, the stock usually moves within the life-cycle, which I think LYC has, now in the mark down phase where trading opportunities may gradually decline as the stock nods off to sleep.
Dont get me wrong, 6% volatility is ok, but better if you are trading, leading into periods of expanding volatility rather than the other way around.
Stock selection a whole subject on it's own..
 
Mistagear said:
Hi I'm interested to know why LYC now ?
Currently volatility is just over 6%, only 5 times in the last 12mths has it reached this low level, average has been around 10% plus it's been from a higher price range.
Trouble with backtesting is, the stock usually moves within the life-cycle, which I think LYC has, now in the mark down phase where trading opportunities may gradually decline as the stock nods off to sleep.
Dont get me wrong, 6% volatility is ok, but better if you are trading, leading into periods of expanding volatility rather than the other way around.
Stock selection a whole subject on it's own..
Click to expand...

Mista, it backtests with far greater % returns than any other stock, even now.
The other major plus for Lynas is liquidity. FMG is a close second.

I think you're right about life cycle but I still believe LYC is on a lot of radars, institutional and DT. The equity curve is very telling. It will let you know when to stop trading this way. It can and will die at some point.

Currently in the queue at 1.16. EDIT: ok bought now 1.16.
 
Gringotts Bank said:
You read the tape, and if you're wrong, you're wrong, and you won't get your 50-100%. As I say, you have to be able to read the depth or you won't make those sort of returns.
O<C, no problem. O>C, no problem. Just read the depth.
Time stop only. EOD or tomorrow's open, and that is my risk management. I've done the sums on that.
50-100%? By backtesting.
Click to expand...

Gringotts,

I'm very curious how you've back tested a strategy which has reading market depth as an entry criteria.

Have you actually back tested your strategy, or just certain aspects of LYC?
 
Just certain aspects. Reading the depth is discretionary. If you nail the low within 3 price levels you will make big %gains according to my backtests.

This is an experiment remember. I'm experimenting with my depth reading. I'm 1/1!
 
Gringotts Bank said:
Paper trading to begin. I have bought $1.15, real volume, real time. I can't prove it, and I don't care. Neither should you!
Click to expand...

Gringotts Bank said:
EDIT: ok bought now 1.16.
Click to expand...

Hi GB,

Please note if you are going to post a trade journal you need to post both your entries and exits as close to possible as real time, this is required across all trade journal threads at ASF.

I can see both entries but when did you exit the first trade and at what level?

Cheers
 
Still paper trading prawn, but am using real volumes and times. I'm only doing it for a week to see how my skills measure up.

Yesterday bought 1.15 sold today's open 1.16 +.86%
Today bought 1.16

$50,000 position size. The sell is always next day's open.
 
The sell is always next day's open
Click to expand...

So this is an over night day trade.

Why wouldnt you hold a trade if you were just to buy at open anyway?
Think it has merit but for me would need a few filters.
Like forget it if a down trend in place or Indexes belted over night.
Have you looked long and short?
 

Similar threads

ducati916
February 2025
2 3
Replies
59
Views
5K
ducati916
ducati916
Top