Saturday, February 4, 2017

QQQ Gap Fill



Here is a QQQ gap fill trade. With e-mini and indexes I prefer taking fades off double resistance and only against the trend when a gap isn't filled. You can plan these the night before. 
 
Here I took the trade off the previous day high and pivot. Goal was before gap fill with the Stop same distance. If the gap would have filled before my entry would have voided the trade.



* You don't have to trade everyday. If the conditions don't feel right or if you're unsure of the current days trading environment then PASS on the trade. Missed money is better than lost money.  Day trading and the stock market is not a "war" that you must win at all cost. Trading should be fun, wait for only the good setups. Follow your rules, stick to your stops, and know that everyday the market presents a new chess board.

Sunday, January 29, 2017

Day Trading the daily bars: GLW, HP, LNG

3 Daily Bar Day Trades from last week: each with strong bars breaking to new highs or lows engulfing previous bars.

HP short: Large engulfing bar breaking to new 20 day plus low. Volume agrees. Enter at low of day .
LNG Long: Strong Green Bar and volume and hitting new high. Followed through the next day with similar bar. Enter high of engulfing bar. 
GLW Long: Strong Green Bar off the 20sma, supporting volume and hitting new high. Enter high of engulfing bar. 

When I am scanning in the morning for 30 minute breakout candlesticks I am looking for these same type...Stocks breaking to new high or lows and with strong volume. Keep it simple in trading stocks with this premise.



* You don't have to trade everyday. If the conditions don't feel right or if you're unsure of the current days trading environment then PASS on the trade. Missed money is better than lost money.  Day trading and the stock market is not a "war" that you must win at all cost. Trading should be fun, wait for only the good setups. Follow your rules, stick to your stops, and know that everyday the market presents a new chess board.

Monday, January 23, 2017

FGEN and SWKS possible trade setups

Here are 2 stocks I will be looking at tomorrow for the Daily Candle trade. Again with the daily candle trade you want to see strong odds that the stock will finish higher then the previous day.

FGEN: For several days lower highs and higher lows while in an uptrend. Broke the trend. Would look to go long high of the green candle.


SWKS: Massive gap up and run. I would pass on this except glancing at the 30 minute chart its condensing at the high. Would look to enter long
For both could exit at Pivot R2 - or hold till end of day.

Daily Chart

30 Minute Chart


* You don't have to trade everyday. If the conditions don't feel right or if you're unsure of the current days trading environment then PASS on the trade. Missed money is better than lost money.  Day trading and the stock market is not a "war" that you must win at all cost. Trading should be fun, wait for only the good setups. Follow your rules, stick to your stops, and know that everyday the market presents a new chess board.

Monday, January 16, 2017

Basics of Trading Part 5: Your Heath and Day Trading the Daily Chart

5th in a series of post's on the basics of day trading for beginner traders. Will be archived so can be used in conjunction with trades I post, and my trading plan which doesn't cover the basics.

PART 5: Your health and trading and a Simple Day Trading Setup Using the Daily Chart.

YOUR HEATH: Everyone needs to take their everyday health seriously and as traders we need to be sharp and alert when our money is on the line. "the preservation of health is easier than the cure for disease" 

Sitting is the "new smoking" and Movement is the key to beating this habit. Set a weekly exercise routine based around walking, mid core, strength training and cardio workouts.

Your daily diet should have an abundance of fruits and vegetables to snack on throughout the day. Supplement intake is almost a must and I highly recommend liquid vitamins that absorb quickly and give you the needed nutrients over the standard hard tablet that absorbs less than 20% into the body. The 2 vitamins I take first thing every morning are Isotonix Vitamin B complex and OPC-3 antioxidant. All natural and keeps me sharp. The follow link I touch more on Your Heath and Trading. http://www.howidaytrade.com/your-health---trading.html

DAY TRADING THE DAILY CANDLESTICK
Step 1: Scan for Bearish and Bullish Engulfing Candlesticks on the Daily Chart. I touched on these in Part 2 of this 5 part series on the basics of Day Trading.

Bullish Engulfing Candles need to be trending up on the Daily and Weekly Chart and bouncing off Support or closing above resistance on the Daily Chart.

Bearish Engulfing Candles need to be trending down on the Daily and Weekly Chart and bouncing off resistance or closing below support on the Daily Chart.
Prefer the engulfing bar has higher volume then the previous day. The engulfing bar must be wider than the average candle and stand out with small wicks near the entry point. When you see this bar you should have zero doubt that it’s an engulfing bar.

Support/Resistance points on the Daily Chart: candlesticks off the 10sma, 20sma, or a multi touch support or resistance area.

Bollinger Bands: can be used to measure the "highness" or "lowness" of the price relative to previous candles using the 20sma and as support and resistance. A tight BB with an Engulfing Candlestick can signal a breakout/breakdown is near. A spread BB with an opposite trend Engulfing Bar can signal the trend is near over. (Example the trend is up with Bollinger bar expanded up and a Bearish Engulfing bar appears off the band)

HOW TO ENTER EXIT AND PLACE a STOP
Entry: For a Bullish Engulfing Bar enter one tick above the high of the bar. Do not chase more than .5 to .10 above the price.

Stop Exit Point: For the Bullish Engulfing Bar place the stop at the low. (I outline in my business plan alternative stop areas - but stick to this stop premise as you learn how the markets trade and become more comfortable) Always exit at end of the trading day if neither stop or exit is obtained.

Exit Point: The same range between the stop and entry point. Add the range to your entry point and this is your profit point. (Example entry is 50 and stop is 49, range is 1.00 – exit would be 51)

Shares to Purchase: Use this calculator to determine the # of shares to purchase based off your risk. New traders don’t risk any more than $25 per trade. http://www.howidaytrade.com/stock-day-trading-plan.html

Video Attached: Here I go through scanning, a few candidates and trades made the previous week to help give you an idea of the process. Will need to click HD on your computer for a clear screen. my find better quality on the Facebook site: https://www.facebook.com/How-I-Day-Trade-163547208984/?fref=ts

video


Of Note: DO not enter the trade the night before - wait until the market opens the next day and hits your entry point. If the stock runs away from you and doesn't trigger your entry then DO NOT CHASE. There is always another trade.

The Daily Candlestick Day Trade will help build a foundation for intraday trading. You can grow your account and learn without the roller coaster ride of quick stop outs, big wins and big losses. Sticking to the trend, using support and resistance and only the trading strong candles will dramatically reduce the number of times you are stopped out and enhance your success rate.

Like any new skill it takes time to learn but most of all you must enjoy it. Trade for the game not for the money.

"A man must believe in himself and his judgment if he expects to make a living at this game." - Jesse Livermore



* You don't have to trade everyday. If the conditions don't feel right or if you're unsure of the current days trading environment then PASS on the trade. Missed money is better than lost money.  Day trading and the stock market is not a "war" that you must win at all cost. Trading should be fun, wait for only the good setups. Follow your rules, stick to your stops, and know that everyday the market presents a new chess board.

Wednesday, January 11, 2017

Basic's of Trading Part 4: Margin, Pattern Day Trader, Account, Commissions



4th in a series of posts on the basics of day trading for beginner traders. Will be archived so can be used in conjunction with trades I post, and my trading plan which doesn't cover the basics. 

Part 4: Margin, Pattern Day Trader, Account, Commissions, More on Mother Market

Margin: Before defining Margin, new traders should avoid the temptation to use margin.  In simplistic terms Margin is when borrow money from your brokerage to finance all or part of a trade. Basically you are given more money to trade with and if you don’t know what you’re doing or inexperienced - more money to lose. But when used properly margin can increase potential returns. The pattern Day Trader can use up to 4x their account in buying power during the trading day. Over night the maximum is 2x from your brokerage to help purchase stock. For example, with a $30,000 trading account, you’ll be given enough buying power to purchase $120,000 worth of securities intraday. Overnight, however, the margin requirement is still 2:1 so the maximum is $60,000. 

What is a Pattern Day Trader: A pattern day trader is a trader that makes four or more round trip trades within five business days and your day-trading activities are greater than six percent of your total trading activity for that same five-day period. So why is this relevant?  To be able to have unlimited day trades, and be approved to use 4:1 intra-day margin, you must maintain a minimum of 25K in your account.  Without this amount you are only limited to three Day Trades over five business days.
Do you Need 25K to Trade?: The obvious  issue is that not everybody can afford to open a 25K+ trading account and have trading privileges...and that is a good thing. New traders should start with a small account and limited trades until your skill and account level gets to the point where you can start to scale up.  

Trading with less than the 25K Minimum: This is the safest method for starting out as a trader.  You are allowed to make three-day trades over a five business day.  This will force you choose only the best setups.  If you see a number of average setups one day, you are more likely to pass on them and wait for a better opportunity on another day. If you stick to $25 per trade risk and lose 10 trades in a row (hard to do) you would only be down $250. Another idea for placing more trades is having a split account. This would give you 6 Day Trades to place over a 5 day period. 

Commissions: When you make a trade you must pay the brokerage firm. Some brokerage’s will offer new accounts free trades for a period of time with a minimum of 5K account. Like any business, yes you need to treat this as a business, there are expenses. Shop around for the best deals. For my IRA I use Think and Swim ( TD ameritrade) so I can access their superior software system for charts and scanning. For day trading my regular account I use Options House for their cheaper commissions.  Check Nerd Wallet for deals, reviews and guidance as they have an article posted on January 6th that needs to be explored in its fullest. I recommend a few times and don’t rush through as lots to uncover.


More on Mother Market:

This video portrays the realization when you gain the respect of mother market through time, practice, study and can recognize high % patterns on a chart with ease. It’s a state of ease as you balance the highs and lows of winning and losing trades by always focusing on the process over  the $. This state of ease is always sticking to your entry point if you miss an entry and the stock runs away without you. This state of ease is sticking to your profit exit point and not getting greedy and holding on for more and ALWAYS sticking to your stop exit point. It’s treating day trading as a business not a hobby.
It’s the understanding the war is over, and that in reality it wasn’t a war with mother market. It was a learning process that gave you the foundation to help propel you to success.



Next Post: your health and trading, Simple Setup using  the Daily Chart and a basic video showing how I scan for candidates and use the charts to filter out daily candidates to trade. 


Disclaimer

I DO NOT MAKE RECOMMENDATIONS TO BUY OR SELL SECURITIES - I JUST POST TRADES I MAKE OR FIT THE RULES OF MY TRADING PLAN ON A DAILY BASIS. DO YOUR OWN DUE DILIGENCE - YOU ARE RESPONSIBLE FOR YOUR TRADES, INVESTMENTS, AND DECISIONS! ALL CHARTS COURTESY OF TRADESTATION, SCHWAb & TD AMERITRADE