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Potential & Breakout trading--Technical tips and tricks

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tech/a - with that volume pattern for BTA, I think that it will have a few inside days with the price tending down to resistance. I would be looking for decreasing volume down to pretty low volume (low volume test of resistance?). What do you think (and others)?

I'm not on this, but it's on my watchlist.
 
tech/a said:
Daki
I use Metastock,and Tradeguider EOD.
but any trading platform would suit.
Click to expand...

Daki
I use Metastock as my primary platform and I run two seperate scans my own breakout that I built which picks up potential breakouts and a Turtle breakout that identifies breakouts over a 20 day period.

I also use MTPredictor EW software which is excellent for EW analysis and will start to kick in again as soon as this market starts to turn up. It works really well at picking up stocks that are in an overall trend and have just had a correction.

I have also got Amibroker and Dynamic Trader but I rarely use either.

Its not the platform that creates the opportunities, its what you do with it and to do anything with it you need to know what you are looking for first and then knowing how to manage it when you find it.


tech/a said:
Boggo
I would have rejected it as well.
we wont get them all but we will get enough.
3rd losing day in a row.
Doing some culling and buying.
Click to expand...

tech/a
It probably would have failed your "eyeball test" too I suspect.
I am very happy with what I am getting too, plenty just in the ASX 300 alone.

One more negative day will trigger a few stops for me but I do like the opportunities that pop up after a few negative days.
 


Yes I do agree (I bought a few yesterday.)
The depth of any retracement (if any) will indicate the level of selling present in the buying yesterday.For holders a shallow short consolidation will be ideal and a signal to me to add.

Deeper and I as well as others I'm sure will reconsider options.
Dont be surprised to see more rising of price before consolidation or pull-back.



The very long accumulation period I find very attractive from a trade perspective.
 
Dont be surprised to see more rising of price before consolidation or pull-back.
Click to expand...

SUPPLY MUST BE EXHAUSTED

Before trading on Monday I think it important to continue some discussion on Volume and Spread analysis of BTA---indeed the following should be considered in ALL BREAKOUT analysis.

You'll note on the chart 4 circles I will discuss each individually but most importantly you MUST SEE Supply being exhausted.
Now I have shown examples of lack of supply in small consolidations as a stock begins a trend,this analysis is for those accumulation phases where supply keeps the share from breaking out of a prolonged range---how and why that occurs and what we should be looking for.

Firstly the Broad picture.

Click to expand.



Now back to NUMBER (1) Its pretty clear this isnt going to "V" bottom.



As The Bottom Flattens we can see a definite change in sentiment.



And now things are VERY different!



Which brings us to NOW.

 
That is excellent tech/a, about three chapters of a book I tried to read on the subject in just one post.

I am going to have to pay more attention to volume behaviour in my eyeballing of scan results.

Cheers.
 
Boggo said:
That is excellent tech/a, about three chapters of a book I tried to read on the subject in just one post.

I am going to have to pay more attention to volume behaviour in my eyeballing of scan results.

Cheers.
Click to expand...

You have my book?
 
tech/a said:
You have my book?
Click to expand...

Mate, I reckon you should write one.
Four main topics, the entry, the exit, money management and basic chart reading along the lines of your post above.

The book I was referring to is "Master the Markets".


Anyone who is starting out and reading this thread I would recommend you go to this site and click on "v6 Introduction (PDF)" link on the left.
Download that document, read pages 1 and 2, ignore all the software stuff and go straight to page 51, and read pages 51 to 59 while ignoring references to the software but learn and understand what he is saying, it will keep you in the market.
http://www.mtpredictor.com/index.php

My
 
This passed my initial eyeball test, note that it is a weekly chart.
If I am reading your description of volume behaviour correctly tech/a then the volume on this is how you like to see it.

(click to expand)
 

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BOGGO

The current chart is different but the past chart has a very similar pattern.
I'm sure you can see the difference.



 
tech/a said:
BOGGO

The current chart is different but the past chart has a very similar pattern.
I'm sure you can see the difference.
Click to expand...

Yes, thanks for that. That single down bar with low volume is an interesting precursor to a move in the opposite direction and makes sense.

Correct me if I am wrong with that bar, it is not so much the bottom pivot, it seems more like a 'test' in the new uptrend in particular the second last bar in the chart below.

Chart of MEP below with a few examples in the recent uptrend.

(click to expand)
 

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The weekly chart of MEP (I was too slow to edit the previous post again)

(click to expand)
 

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Hey guys - great thread, really enjoyed reading so far, picking up some new ideas which is good.

Thought I'd post up MOD for you to have a look at, I think it may be setting up for a new run after a recent breakout.

As you can see hopefully see in the attached, it brokeout on 22/12 on high volume, continued up for a bit and has since retracted a bit on much lower volume.

So I point this out because on the last trading day we've got a down day, small range, and comparatively small volume. The stochastics are also down.

Thoughts?

Disc: I do not hold MOD.

 
My

A down bar on light volume to me is not a good sign. Also, the retracement is large - almost 30%. I would need to see price level out (support) first, followed by a wide up bar on good volume. I just can't see it happening in the near future.

As I'm still a novice, I now defer to other, more experienced traders for their views.
 
Thanks tech, very informative, it's been an ongoing for me to improve my techincal analysis skills, it's definitely helped decrease my opportunity cost by helping me recycle my capitaly more effectively as its reduced the gap between my entry point and when the trade works either in my favour or not.
 

MOD went through a backdoor listing on 22 Dec and changed from whatever shell it was into an explorer backed by someone from the Sandfire team - hence various people getting overly excited and decided to pay 22c for the 10cps MOD holds in cash...

The point is any price volume analysis you do needs to treat the company as a completely different one from 22 Dec onwards.

Apologies for keep bringing fundamentals into a technical thread.
 

Back at work so just dont have the time to reply during the day.

The first thing to consider is that this stock has not started any consolidation after the High yet.
We see successive low closes and while the low volume indicates a lack of supply we are yet to see if there are any buyers who want this.
To get into this or add I would want to see a low followed by some clear buying (This may not be supported by volume) if supply has left price will rise easily even on low/moderate volume.
I note today's bar's low is at close of the 22/23/12/10 high volume bars which makes sense for buyers to place a buy stop.
Aggressive buyers would have bought today with stop at 15c.
To me this is yet to prove itself so would be watching---probably not even that!


This is a good thing.

With tighter stops I cut back my risk even more by risking 1% of my capital Even .5% with really close opportunities I see during the day.
I still have good parcel sizes but a narrow margin before the Stop kicks.
This is only wise in a BULLISH day
You want to be in the money immediately, and want to cut down on the chance of being stopped.

Its great to see people benefiting,thanks for the feedback.

On a separate note.

Getting belted at the moment.
Had 5 losing days still culling and still buying but have cut back the risk % and parcel sizes --- not adding to winning positions until I see an up turn to consolidation.
Its tough in these times to remain focused and realise that our skewing of our management of portfolio will see us on the winning side over the longer term.
 
Can we post Trades on the Trades Threads

Unless its making a point about a Tip or Trick in trading a breakout.
 
A LOW VOLUME DOWN DAY DOES'NT MEAN NO SUPPLY IN EVERY CASE

I have to straighten this out----I'm seeing Analysis from people on this forum who are now labelling Low Volume Bars as lack of supply.

It can and does mean in certain circumstances LACK OF DEMAND.

So how do we know??
Note a single bar in a single periodicy is valid for 3-5 subsequent bars. In other words it (The Signal) is/will be validated or negated within 3-5 bars after that other analysis will come into play.

I have shown ONLY EXTREMELY low Volume in a Tight Range Consolidation after a move up in trend.

Click to expand


 
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