Best Practices - Let's share what works

[dmk112]

Peanuts - nice post. So basically a momentum trade into the morning.. find a stock that is rallying and closes near the highs.. I like it.

Would FRX qualify?

[peanuts]

Peanuts - nice post. So basically a momentum trade into the morning.. find a stock that is rallying and closes near the highs.. I like it.

Would FRX qualify?

It looks like it fits everything except that major indices had a down day. The more things that fit the conditions, the better the odds that it works out for you. Some people don't like to hold the shares overnight.

[peanuts]

Peanuts - nice post. So basically a momentum trade into the morning.. find a stock that is rallying and closes near the highs.. I like it.

Would FRX qualify?

It looks like it fits everything except that major indices had a down day. The more things that fit the conditions, the better the odds that it works out for you. Some people don't like to hold the shares overnight.

Crazy how things happen... FRX gapped down and then was pummeled -13.77% for the day. The people who did not hold overnight were the winners.

[skiracer]

Crazy how things happen... FRX gapped down and then was pummeled -13.77% for the day. The people who did not hold overnight were the winners.

i can appreciate the strategy/concept but what could anyone possibly have seen in FRX that would lead them to want to make an entry before late that afternoon the day before the gap down. and looking at the 30 min chart of that day it didnt make that gap up until almost the last minute so how do you find them at that point. and without a decent looking chart or pattern developing how could you hold overnight if you did get in on it at or near the close. i just dont see it.

[peanuts]

i can appreciate the strategy/concept but what could anyone possibly have seen in FRX that would lead them to want to make an entry before late that afternoon the day before the gap down. and looking at the 30 min chart of that day it didnt make that gap up until almost the last minute so how do you find them at that point. and without a decent looking chart or pattern developing how could you hold overnight if you did get in on it at or near the close. i just dont see it.

You make some good points. And the more I consider them, the more I see how it did not meet the conditions very well. It would have been a tough one to catch, and regrettable if you did.

[skiracer]

You make some good points. And the more I consider them, the more I see how it did not meet the conditions very well. It would have been a tough one to catch, and regrettable if you did.

i think the strategy holds water and if you start monitoring for movers in the last 1 1/2 to 2 hrs before the close you may catch one that is going to make somewhat of a dramatic move regardless of how good or bad the chart looks previous to that day. holding one of these plays overnight is risky and can lead to what happened with FRX. but on the whole if you have the time to sit and watch you will see plenty of decent setups for this strategy.

[peanuts]

If AMED picks up some strength into the close, then it should meet all the parameters of the trade

[dmk112]

If AMED picks up some strength into the close, then it should meet all the parameters of the trade

didn't get in on this one... let's see how it does.

[dmk112]

You make some good points. And the more I consider them, the more I see how it did not meet the conditions very well. It would have been a tough one to catch, and regrettable if you did.

True, it was an intra-day move on news which probably would have disqualified it.

[skiracer]

didn't get in on this one... let's see how it does.

it fell 1.29 pts. from 1:30 pm to the close yet was up 2.30 pts for the day. gapped 1.11 pts at the open and was up 3.75 pts at 1:30 pm but the profit takers took over from that point. i thought the model called for catching a stock starting to make a big move sometime around 3:00 pm and riding the wave until near the close and then exiting with those gains. i was looking at RNN today at 3:00 pm and thought that it was looking like it was going to make a big move but then it stalled out. momo guys and profitaking again. i have been watching for this type of situation since you first mentioned the strategy but havent come across any. it's a nice concept but in realilty they are hard to come by and few and far between. i watched KLIC on and off all day. gapped up at the open 1.30 and stayed rangebound all day. i thought it was a nice candidate for a big move near the close and was looking for it to make a move around 3 pm but never materialized.

[dmk112]

it fell 1.29 pts. from 1:30 pm to the close yet was up 2.30 pts for the day. gapped 1.11 pts at the open and was up 3.75 pts at 1:30 pm but the profit takers took over from that point. i thought the model called for catching a stock starting to make a big move sometime around 3:00 pm and riding the wave until near the close and then exiting with those gains. i was looking at RNN today at 3:00 pm and thought that it was looking like it was going to make a big move but then it stalled out. momo guys and profitaking again. i have been watching for this type of situation since you first mentioned the strategy but havent come across any. it's a nice concept but in realilty they are hard to come by and few and far between. i watched KLIC on and off all day. gapped up at the open 1.30 and stayed rangebound all day. i thought it was a nice candidate for a big move near the close and was looking for it to make a move around 3 pm but never materialized.

You're right, I think it sold off too buch.

[peanuts]

AMED did not meet all the parameters:

general bull market, check
3 month high, check
positive day for major indices, check
$10 million in avg. daily trade, check
up 5% on the day, check

But... AMED lost strength going into the close. It needed to stay above $63.56 for it to be within 20% of its daily move (prev close = 60.69, today high = 64.28 ). At 3:00, it was already below this level and this would have canceled the trade.

These plays are only hard to find now, Ski. During the right times there are a few of these happening every day. Back in 2007, I can remember a train of 4 days where I had $30K involved in 6 trades. I made just under $6K that week. And it was all over-night moves. I didn't sleep well any of those nights. I would buy an unknown stock in the last half hour and sell within the first 1.5 hours... it was complete blind faith in the system, but it worked, and that was all that mattered.

First of all, I only search for these types of plays during the right market conditions. And then I do a preliminary search during midday. I manually run the calculations and see which stocks are fitting the criteria. I don't catch them all, but when I hook one, I make it worth my while. Even if I only do this trade 3 or 4 times a year, I make a better return than most everyone (except Ernie)... seed X 3% x 3% x 3% x 3% = 12.55% return.

The trade has failed me a few times... each and every time has been due to news that was released outside of market hours. All other times, it worked... sometimes a lot, sometimes only within the 2-3%. But, I would still consider at as worthy of sharing "what works"

[skiracer]

AMED did not meet all the parameters:

general bull market, check
3 month high, check
positive day for major indices, check
$10 million in avg. daily trade, check
up 5% on the day, check

But... AMED lost strength going into the close. It needed to stay above $63.56 for it to be within 20% of its daily move (prev close = 60.69, today high = 64.28 ). At 3:00, it was already below this level and this would have canceled the trade.

These plays are only hard to find now, Ski. During the right times there are a few of these happening every day. Back in 2007, I can remember a train of 4 days where I had $30K involved in 6 trades. I made just under $6K that week. And it was all over-night moves. I didn't sleep well any of those nights. I would buy an unknown stock in the last half hour and sell within the first 1.5 hours... it was complete blind faith in the system, but it worked, and that was all that mattered.

First of all, I only search for these types of plays during the right market conditions. And then I do a preliminary search during midday. I manually run the calculations and see which stocks are fitting the criteria. I don't catch them all, but when I hook one, I make it worth my while. Even if I only do this trade 3 or 4 times a year, I make a better return than most everyone (except Ernie)... seed X 3% x 3% x 3% x 3% = 12.55% return.

The trade has failed me a few times... each and every time has been due to news that was released outside of market hours. All other times, it worked... sometimes a lot, sometimes only within the 2-3%. But, I would still consider at as worthy of sharing "what works"

not knocking the strategy. and i'm sure in the right market environment there would be plenty more candidates on a daily basis. i like the idea and will keep watching and if i come across one i'll post it right away that afternoon.

[yoyomama]

Now your turn...

Grab profits...I keep having to learn this the hard way.