Discretionary Trading Method-----Trading Outliers

[tech/a]

Yeh Porper it could well be wrong but like everything you gotta give it a go to the best of your ability.
Hopefully Wave or Nick Radge may have a comment.
Nick mentions in his book that he didnt feel a complete wave count was necessary to gain the Gist of whats happening in the developement of price action.

 

[Porper]

Yeh Porper it could well be wrong but like everything you gotta give it a go to the best of your ability.
Hopefully Wave or Nick Radge may have a comment.
Nick mentions in his book that he didnt feel a complete wave count was necessary to gain the Gist of whats happening in the developement of price action.

Totally agree, got to give it a go, like I said, I am no expert, but am learning as I enjoy it, just saying how I see it, I could be wrong also.

It would be good to see how it really should be marked, especially the consolidation in the middle.

From what I have read, if you can't easily see a pattern, then step aside and trade something else.Be interesting if this is a case in point.

 

[tech/a]

For those interested in following up the DYL trade I have completed the trade and made comments over the last 2 days with analysis here.

https://www.aussiestockforums.com/forums/showthread.php?p=86337#post86337.

Nick emailed me and said he would comment when not so busy.
Hopefully that will be soon.

 

[tech/a]

A short term trade example using AIM. More a short term trade than looking for an outlier move.
First chart is a tick chart showing obviuos support and resistance. Buy is the breakout.
Will update as trade progresses.

 

[nizar]

nice one tech/a, i bought this one as today as a papertrade, in at 22c, stop at 21c, lets see how it goes...
the volume is there..

 

[tech/a]

AIM

After yesterdays trading lets look at firstly the EOD chart--Daily.

Traders who took the trade yesterday as a short medium term trade would notice. The strong initial gap away from 17c which can now be seen as a breakaway gap.The further gap from 20c is quite possibly a continuation gap.Having taken out the most recient resistance at 20c
The singular bar Friday tells us that the price was supported well after open and infact hit a high of 24c with a close above the open by .05c indicating buyers had the ground for the day.

However lets look at Volume. A huge spike in volume can be seen. The concern is that even with such a high increase in volume price failed to run away. So lets look at the tick chart to see if there are any clues.

 

[tech/a]

AIM Tick chart

Here we see some interesting developements.

Most of the days trading can be seen taking place between 22.5c and 23c.
So unlike the daily chart we can see clearly that buyers and sellers jostled all day at these values. However for the latter part of the day it can be seen that support dropped away from the 23c area to the 22.5c area where most of the trading took part after 2.00pm.Infact there were some trades at 22c albeit that buyers moved in strongly to push it back to 22.5 c. but it does show a weakness in the end indicating that perhaps new buyers were fading.
This was at the very end of the day and I read it as buyers waiting for close to gain best pricing.

At the end of the day we see price pushed back up to 23c on strong volume.

We can also see that buying won out more often than sell.
The green volume bars represent positive buying and the red bars represent positive selling.From this we can see strength in buying IE accumulation.

So finally I read this as a positive sign that one of 2 things are likely to occur.

(1) Accumulation will continue between 22-23c with possible testing of 24c
I would veiw a fall to 21.5c as an exit from my short term trading of this stock as it would indicate lack of buying support at least for the near future,and that the gap is being tested.I personally would be looking for that test if it occured to buy on a reversal out of the gap---if it wasnt closed.
Often a gap will be half closed before moving back in the direction of the initial gap.

(2) New buyers will come in and create another support and resistance level/s. Indicated by the volume and price action toward and at close.

Immediate price action on AIM is very much in the balance as the 2 red lines indicating strong sell spikes tell us.
There has been both strong selling and buying. Im leaning toward accumulation and as such will need to see any selling at 21.5c sustained or strongly sold down. Spikes down will not trigger a sell for me immediately.
Who will control in the immediate future---
Ill let you know Monday.

You can see how valuable these charts and volume can be to the short term trader.

 

[Freeballinginawetsuit]

Agree T/A, AIM needs follow through volume over the next days . Very informative charts you posted.
Considering AIM'S two gap opens within 3 days last week and the 4 cent gap on Friday, the close was stong in my opinion.

As I had so many shares in AIM I sold a significant parcel (third of my holdings) at 23c, the rest I'm holding as a long termer, so not so concernd if it trades in this range for a few days and brings a few new punters in at the expense of profit takers.

 

[tech/a]

ill just bump up the reply thread to keep this continuous.

 

[mildew79]

hello tech/a

thanks for the insight to a very succesful trading method. i used to trade very similar to this, however my exit strategy using stops was a little different.

on initial buy i would place stop at near support as you do.

if sp gaps at open, i would place stop at previous days high. however, if it did not gap i would place the stop at previous days low. in the event there is two possibilities for stop placement i would take the higher value of the two.

my strategy for inside days were also very similar, however my trigger to enforce this exit strategy was a 25% rise in one day

never held more than 4 positions also. only traded positive market / sectors using this method.

you are obviously more developed in your use of intraday indicators / oscilators. any chance of you buzzin me exit indicators you have found most useful and ways i can learn more about these ie) what are your best learning sources eg books etc?? cheers

 

[tech/a]

Hmm

We must be related!!.

I dont use oscillators or Indicators purely price action is short term trading.

 

[mildew79]

im talking about about when deciding which trade to enter?? sorry i said exit im always interested in better seiving out the cream of the crop. do you like certain indicator confirmations prior to entry, or is volume activity purely enough for you??

 

[tech/a]

Watching AIM closely---after 1.0 hr trading there have been 3.2 mill in buy volume and about the same in sell volume.

 

[nizar]

Watching AIM closely---after 1.0 hr trading there have been 3.2 mill in buy volume and about the same in sell volume.

Didnt AIM already hit your initial stop of 21.5c?
It was always gonna struggle today after zinc's sharp fall on friday - a great pity though - couldve been something special here.

 

[tech/a]

Didnt AIM already hit your initial stop of 21.5c?
It was always gonna struggle today after zinc's sharp fall on friday - a great pity though - couldve been something special here.

From above.

Immediate price action on AIM is very much in the balance as the 2 red lines indicating strong sell spikes tell us.
There has been both strong selling and buying. Im leaning toward accumulation and as such will need to see any selling at 21.5c sustained or strongly sold down. Spikes down will not trigger a sell for me immediately.

 

[ezyTrader]

It was always gonna struggle today after zinc's sharp fall on friday - a great pity though - couldve been something special here.

Hmmm...
Weight of strength- 44M traded on Friday with two gap-ups last week.
Buyer interest today....still strong IMO
Depth shows Buyer support at 21, 20.5, 20 atm

Also, a saucer formation, won't be today of course...
Then also, may or may not be tech/a's discretionary trade style...

my

PS: Also, watching closely with great interest
Don't mean to butt in, tech/a - but do you look at the things I see as part of your discretionary trade assessments? Or more, or less?

 

[tech/a]

Ezy

Will answer fully later.

Have sold 50% of position at 21.5c will discuss later.

 

[tech/a]

Hmmm...
Weight of strength- 44M traded on Friday with two gap-ups last week.
Buyer interest today....still strong IMO
Depth shows Buyer support at 21, 20.5, 20 atm

Buying depth shows me very little and is misleading,You can get bids stacked and pulled same with sells.Mainly the idiot factor at work---so I need something more relaible and thats where Prospecta comes in. I can see a graphical display of price in various timeframes and volume ---more importantly where it is going---buy side or predominantly sellers.
I havent todays chart here but will post it before trading tommorow to further explain and see what we can find.

Also, a saucer formation, won't be today of course...
Then also, may or may not be tech/a's discretionary trade style...

my

PS: Also, watching closely with great interest
Don't mean to butt in, tech/a - but do you look at the things I see as part of your discretionary trade assessments? Or more, or less?

Im really basic.
I dont wish to and wont put up with price dropping or staying stagnant,so Price action and Volume it is.
Support and resistance (Longer timeframes than ticks) and in particular areas of consolidation of a price.Which rather than a line of support/resistance becomes an area. Important in various timeframes.

I find shorter timeframe S&R and Congestion areas weaker than longer term.
15 min as pretty good chart wise and is what Steidlmayer uses in Marketprofile which I use "Loosely" without plotting.

If it moves up then Ill load it down Ill off load it or some,sideways Ill only put up with for a while.

My main concern is mitigation of risk.
The only time you have control of you capital is when its out of the market.
I dont mind the market having control if its using my money wisely---making a profit--If its not then I would rather miss out on a quick "Possible" reversal from a fall than---hold and hope.

See my decision is pretty well based on ---My analysis says this will fly now or in the very near future.If it doesnt then Im wrong---for now---So Ill mitigate risk and either find another or re enter when my analysis on that stock is proven to be correct.

AIM.

Went as I thought--- Seemed to be accumulation with upside volume topping sell volume. Gap being partially filled. Could go to 20.5c.
Sold half the position and held the other half as From what I see this seems to be priming for a move.The smaller position allows me to take the same risk and adjust my analysis opening my initial stop a little,giving room ---favoring a corrective move before going again.

Have a look at this 3 day chart.
Hopefully you'll be beginning to see the enormous difference that charts in various timeframes can display.Critical NOW information

 

[tech/a]

AIM

Topped up again at 24c
This will not be the last buy if it remains positive.

 

[tech/a]

Ooops updated AIM over here.

https://www.aussiestockforums.com/forums/showthread.php?p=92120#post92120