I had a couple of really nice trades this week that I want to discuss. I half-jokingly tweeted about the first one, chalking it up to dumb luck. While there was certainly some luck involved, I'm reminded of that old saying about luck:Read More ➞
So this was a slow couple of weeks for me. I was out of the country on vacation for most of that period, so I was trying not to do much trading. Also, I don't like to do a whole lot in the heart of earnings season, because the market can often become choppy from one day to the next based on how the reports are each day.
First an update on the positions (CENX & MNTA) I mentioned in the previous Trades of the Week.Read More ➞
I'm going to try to do a post like this at least every other week. My goal here is to show a bit of my process and the scans I use to find these trading candidates. They certainly won't be the best trades one could have possibly made, it will just highlight those I found and chose to take.
First up is CENX. This stock has been on my watchlist for a few weeks because I traded it in December. I bought above that consolidation pattern at $16.14 (with a stop loss under that rectangle at 15.30 -- a great example of a classic Darvis Box or a flag) and sold it on December 28th at 19.82. So my initial risk (1R) (read more about R and R multiples here) was 84 cents per share, so I made 4.4 times my initial risk (4R). I liked how the stock was acting, so I kept an eye on it by adding it to one of my watchlists.Read More ➞
- You don't need a high win-rate to make money. He made that $220K with a 62% win rate. The key is to keep your winners bigger than your losers and to have a positive expectancy
- You can make money on non-penny stocks! He made significant amounts of money on stocks priced over $20 and those priced under $20. And many people wouldn't even consider trading stocks above $5 or $10! (It drives me crazy to see people focus so much on low-priced stocks. You should think in amounts of money invested and percentages, not number of shares and points!)
- There's a lot of opportunity on the short side. 40ish % of his profit came from shorting.
- It's important to keep and review a trading journal.
- It's critical to have a plan and stick to it.
I'm looking forward to watching some of the presentations over at Chart Summit, a virtual conference of technical analysis. I've been a fan of Brian Shannon's for over a decade and I met Chris Kimble at Stocktoberfest a couple of years ago after watching his impressive talk. So I already know their talks will be great. Judging by some of the talk titles, those videos should be helpful to folks new to technical analysis in figuring out ways to use SwingTradeBot's scans & signals.
Here's the email I got announcing the availability of the Chart Summit videos:Read More ➞
I thought I'd share some thoughts I had while reviewing my trading results so far this year. Through today, the end of September 2016, the Nasdaq is up 6.08%, and the S&P is up 7.09% while my swing trading account is up 33.09%. While I'm happy to be outpacing the market by 4.5x, I'm a little disappointed that my account isn't up even more. That's because I know I missed a few trades that could have easily doubled or tripled my gains from where they are now. Nonetheless, I feel good that I've mostly stuck to my rules and that I'm still trading with a positive expectancy. Let's take a more detailed look.
The dark blue line in chart above is my account and the green line is the S&P 500. What stands out to me when viewing my equity curve is that it's been a pretty orderly rise punctuated by some choppy, sideways action -- and then there was Brexit on June 27th. The primary reason for the sideways periods is that the market itself was chopping around and I try to do less when the market is not trending up or down.Read More ➞