Tuesday, August 9, 2011

Some ideas for tomorrow and few adjustments to my trading plan!

The close of trading today marked the 7th day of trading prop with Bulls Pro for me. During those 7 days, I have had the freedom to jump in and out of any thing that I feel like since I'm no longer under the PDT rule. I must say it has been a roller coaster ride and unfortunately my account is now down 26% after being down as much as 32%! Now while this is a total drag I am pleased to say that I have learned a lot and will make some adjustments to my strategy accordingly!

Here's what I have learned in bullet points:

  • Unless a stock has fresh news, it will most likely follow the general trend of the market almost to the minute! So this rule does not only apply on the daily time frame but on the intra day time frames as well.
  • Stocks with fresh news can trend intensely in one direction even against the markets trend for a significant period of time.
  • When you're swing trading a stock you need to ignore intra day price movements!
Here at the adjustments that I plan to make: 
  • keep a list of 3X Bull and Bear ETF's and relatively strong and weak (volatile and liquid) stocks to watch for day trades based off the intra day trend and/or technical set ups that I am seeing in the overall markets (I use the 5 minute SPY chart as my proxy)
  • Cultivate a list of stocks with fresh news from A/H into the pre-market and early trading that are in play to watch for intra-day flag/base break outs/downs.
  • keep a separate list of stocks that I want to swing trade; if I enter them at the trigger price, set a hard stop and forget about them until they hit my target.
So my watches from now on, will be structured according to the adjustments above. Here they are:

GO TO LIST

Longs: $MAKO, $VHC, $CBOU, $SIMO, $HNSN, $MCHX, $ARIA, $JVA, $HUN, $FTK, $SPPI, $IDCC, $QCOR, $RENN, $GOL (STOCKS) $DRN*, $EDC, $FAS, $TNA (ETF'S)
Shorts: $P (STOCKS) $DRV*, $TZA, $ERY (ETF'S) 

*Extra HOT!

STOCKS WITH NEWS

$MOTR down 50% after hours. So should be in play tomorrow. Will try to highlight any interesting ones I add to this list via twitter during the day. 

SWING LIST

Longs


Shorts


After days of anticipating a bounce it finally came and I caught part of it using $TNA. Wish I had overnighted a part position in hindsight but I stuck to my plan which was to just day trade although I did exit prematurely and move to cash before the close! I'm very long biased short term so I do not recommended trying to take swing shorts although it will be good to have some short exposure as a hedge if you take some long swings. I'll go as far as saying that I am anticipating a long sided trend day tomorrow in the markets. Please note, however, that this is still a hit and run market in my opinion and with the high levels of volatility I think its better to be day trading as opposed to swinging/over nighting stocks if you can afford to. On that note, I'm off!

Good luck and good trading!

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