Spike's Scientific Stock Analysis

[billyjoe]

Spike,
With 5 weeks left in the Cheap Stock Port experiment I don't think my 1% gain per week goal will be met. The 7,6,5% stops are putting me in too big of a hole to be made up unless a superstock appears each week and that's not likely. I believe a universe of higher priced, less volatile ,fundamentally and technically superior stocks will return an average of 1% or greater per week. This will be the next experiment. I will be looking more closely at charts, partially surrendering to the TA'ers. Any critical analysis on your part or anyone else on Mr.Market's site will be appreciated. Thanks in advance.

billyjoe

[skiracer]

Spike,
With 5 weeks left in the Cheap Stock Port experiment I don't think my 1% gain per week goal will be met. The 7,6,5% stops are putting me in too big of a hole to be made up unless a superstock appears each week and that's not likely. I believe a universe of higher priced, less volatile ,fundamentally and technically superior stocks will return an average of 1% or greater per week. This will be the next experiment. I will be looking more closely at charts, partially surrendering to the TA'ers. Any critical analysis on your part or anyone else on Mr.Market's site will be appreciated. Thanks in advance.

billyjoe

Billyjoe,
Have you gone back an looked at the stocks that have stopped out in the 6/4/2% ranges to see if they have reversed after getting stopped out and gone on up higher than the price they stopped out at. I would want to see that info because it could be pointing to your stops being to close. Maybe you have to give them alittle more room to breath.

[billyjoe]

Ski,
Just did a quick recap and found approx. 50% recovered. These should be good stocks for holding long term, but I'm liquidating every Friday and starting over. That may be the absolute wrong way to play these low priced stocks. The next 5 weeks will tell the tale. That's why I'm thinking more established high quality stocks would work out better in this type of trading.

billyjoe

[skiracer]

Ski,
Just did a quick recap and found approx. 50% recovered. These should be good stocks for holding long term, but I'm liquidating every Friday and starting over. That may be the absolute wrong way to play these low priced stocks. The next 5 weeks will tell the tale. That's why I'm thinking more established high quality stocks would work out better in this type of trading.

billyjoe

I think the close stops work fine depending on the plan. They seem to work great for Spike's strategy's of finding that perfect entry and keeping his stops very tight. On the other hand most of the stocks in your exercise aren't the perfect entry type of situation and those close stops look to be taking their toll as you get further along into the exercise. I was just curious to see what % of the stopped out one's came back above the stop out afterwards.
Since this is only an experiment to gain more insight into how an exercise will develope over time an you're only papertrading it, it can't hurt you an you can only benefit from the time and work invested in doing it.
I agree that a more select, researched and higher quality, group of stocks would have a better chance of working out better, but then the entry points also play a signigicant part in determining the chances of successful trades. Since your exercise is more of a random time or point of entry the managing of the stops, in my opinion, and the length of holding the trade becomes much more of a significant factor in determining the success factor. Why don't you run the same portfolio in two scenarios with the stops placed the way you have been placing them in one and in the 2nd loosening up the stops or leaving them at say 6/7% for the week just to see the outcome for a week or two.
I also think it would be neat to go back to your first week and see exactly where those picks would be at today if no stops were in place, with stops placed and left at say 7%, and with stops placed and left say at 6%. Sorry I'm suggesting alot of extra work for you. Since that is the case I would give you a hand with doing that if you were interested in going back and doing that. I guess all the portfolios for the past 5 weeks would be found easily enough since they are all right here on this thread. Sorry, not on this thread but on your other thread.

[spikefader]

Thanks Spike but what about your past trades? I did it manually be the trade transactions but that takes for ever! (I emptied by box).

I would strongly recommend you get some software rather than doing it manually. Tradelog (http://www.armencomp.com/) is awesome for active traders. Handles futures, stocks, options, wash sales, MTM accounting. All you have to do is import your IB transactions into it and it does it all for you.
You can view a demo of the software here.

[spikefader]

Spike, how does AOB look as a short?

Perhaps start stalkin' it at 6.00.

[dmk112]

I would strongly recommend you get some software rather than doing it manually. Tradelog (http://www.armencomp.com/) is awesome for active traders. Handles futures, stocks, options, wash sales, MTM accounting. All you have to do is import your IB transactions into it and it does it all for you.
You can view a demo of the software here.

Thanks Spike, AMTD & Scottrade used to have this built it. IB really needs to get their software upto par, that's one of my complaints about IB.

[spikefader]

Spike,
With 5 weeks left in the Cheap Stock Port experiment I don't think my 1% gain per week goal will be met. The 7,6,5% stops are putting me in too big of a hole to be made up unless a superstock appears each week and that's not likely. I believe a universe of higher priced, less volatile ,fundamentally and technically superior stocks will return an average of 1% or greater per week. This will be the next experiment. I will be looking more closely at charts, partially surrendering to the TA'ers. Any critical analysis on your part or anyone else on Mr.Market's site will be appreciated. Thanks in advance.

billyjoe

Yep, it always comes back to the stops and downside limitation. Your experiment has only been running a short time, so it's hard to make a decision on whether it's going to be profitable over time with the stops you're using, but I expect that with 7% stops on day one is going to hurt too much. So I'd encourage trying to set 4% loss on any 1 stock. Managing the downside is imperative for success I think.

Maybe if you introduced the r/r equation into it the way I do. Your picks have to act a certain way before you enter (eg. double bottom formation). It'll be more work for sure, but I think that would help. That will force you to identify areas of lowest risk intraday. And there's no reason you can't use an attempted double bottom entry with 1% risk on it, and then you can afford to do that 4 times in a row before you strike it from the list of candidates cuz it's reached the 4% limit, and then put the money elsewhere.

Or if that's too much work, then wait for double bottoms to show up as nice patterns, then bid no more than 4% above the lod with your stop tucked under lod. If it stops out, there's your -4% limit and it's off the list. If it works out, stop to even and target at least 16% on half (or all of it) and let the other half run with b/e or trailing stop, or trail a stop and tighten it up where you get parabolic moves up.

Some ideas anyway.

[mystiky]

Spike..about that MCX chart...

Spike,

I hope you are not to busy to post that MCX chart that you were hoping to do over the weekend?

As I am guessing, you think its not going higher than 15 and should find some support around 13?

[spikefader]

Spike,

I hope you are not to busy to post that MCX chart that you were hoping to do over the weekend?

As I am guessing, you think its not going higher than 15 and should find some support around 13?

Doh! Yup, thnx for the reminder. Anyone else I've missed or forgotten throw another post up and draw my attention back to it. So much to do, so little time!

OK, MCX comin' right up.

[billyjoe]

Spike ,
How about CLMS , AMG's rival ?

billyjoe

[spikefader]

MCX:

I'd be exiting your position mystiky at pink 'b' completion area, and then stalking for green weekly 4 completion to coincide with pink 'c' long entry.

[spikefader]

Spike ,
How about CLMS , AMG's rival ?

billyjoe

Near resistance, but daily setting up and at least providing an opportunity to boom. I'd be taking profit at the top of the 5th and stalking and watching.

[spikefader]

Dow trend lines FWIW

[spikefader]

VPHM: Bullish on it, and see an entry at intraday pivot 19.98 tomorrow, target new highs, 4% risk (19.17 just under price support). It's coming off a weekly c long, the daily has a channel turn up, plenty of upside to the channel resistance from the top, moving up and away from nice vol by price at 18.01. I'll be stalking +DUZAD call options (Jan 20 strike) for it this week. Should be good for at least 4 bagger this month with a strong 5 point move....but let's not get ahead of ourselves. Just a valid setup at this stage.