HotStockMarket Message Boards - Blogs http://www.hotstockmarket.com/forums/blog.php Top rated stock market forums, penny stocks, mid cap, large cap, live chat stock tips and educational videos - HSM Message Boards en Thu, 02 Sep 2010 17:16:56 GMT vBulletin 60 http://www.hotstockmarket.com/forums/images/misc/rss.jpg HotStockMarket Message Boards - Blogs http://www.hotstockmarket.com/forums/blog.php Advanced Orders http://www.hotstockmarket.com/forums/blog.php?b=99 Sun, 22 Aug 2010 08:49:02 GMT In todays age of electronic trading, there really isn't a good reason to avoid the use of an automated stop for capital preservation. It drives me nuts when I here people say (something along the lines of), "I don't use open stop orders because MM's can see them and will manipulate the pps to take them out in order to load up on cheap shares or profit or whatever!" This statement doesn't bother me because it's not true (it very well could be), it bothers me because it's completely avoidable...

Enter the Advanded Order. I use Scottrade so I'll reference their order capabilites. Other online brokers offer similar order types, but the nomenclatures might differ (bracketed orders, etc). There are 3 types of ST Advanced Orders: Conditional, One Cancels Other (OCO), and One Cancels All (OCA). You really only need to understand the Conditional Order because an OCA is simply a string of 2 Conditional Orders and an OCA is more than 2 of the same. The principle of the Conditional Order is "Place this order"..."If the following event occurs." For example, "Buy 100 shares of GOOG"..."If the last price of GOOG is less than or equal to $450." Add "or Buy 100 shares of GOOG"..."If the last price of GOOG is greather than or equal to $509" and you have an OCA. This order would allow you to get into GOOG at support or on a breakout. This picture gives another example with ARNA that would allow you to lock in profits or protect your capital.




Scottrade offers the following triggers and conditions:

Triggers
Last
Bid
Ask
Volume
Change from current price
Daily change
52-week high/low

Conditions
Greater than or equal to
Less than or equal to
Up/Down

You can also use varying limit, market, and stop orders as well as options, AON, and combinations. I've used Advanced Orders to buy options at a limit price when the underlying stock hit a certain pps at support or resistance. Also, as the names imply with OCO's and OCA's, when one Conditional Order is met, the other Conditional Orders are canceled.

Since this order isn't placed until a condition is met, there is no order sitting on the bid prone to MM manipulation. So no more of that tired excuse... The other advantage, which is way undervalued and never talked about, is that the Advanced Order offers electronic discipline; it literally removes trader emotion from the equation. Mental stops aren't for everybody, especially beginners. There are traders who will NEVER have the discipline required for mental stops. Advanced orders to the rescue.

TOS and some other online brokers (TradeKing?) go a step further with order features and allow a filled order to be the trigger. For example, if Order #1 fills, then place Order #2. This is the ultimate feature for a part-time trader with a full-time job (like myself) and I plan to use one of these brokers eventually. Theoretically, you could place a series of Advanced Orders for every possible scenario and not even watch the market intraday or intra-WEEK...while still maximizing profit.

Save yourself some time and energy, use the electronic discipline of Advanced Orders. Good Luck ]]> 22rowdy http://www.hotstockmarket.com/forums/blog.php?b=99 Locking in Profits http://www.hotstockmarket.com/forums/blog.php?b=98 Fri, 20 Aug 2010 21:02:32 GMT My postings and blogging have been light lately because I have spent much time dabbling in real estate. I will get back to that later down this page.... My postings and blogging have been light lately because I have spent much time dabbling in real estate. I will get back to that later down this page.

Taking Profits
I have preached for quite some time to lock in profits when a stock rises above the upper bollinger band. This is how I play all of my stocks unless this there is warning signs that dictate I take profits sooner. When I am in doubt I will take 1/2 out and that is on a break out scenario. Either way the principle has worked out quite well. As they say no one has ever went broke from taking profits.

Building Cash
Depending on the type of market that you are in, increasing your cash may be one of the better options and when that stock that you sold becomes undervalued you may pounce on it again for a discount. My cash reserve will drop when buying opportunities pop up and build back up when I take my profits.

Those that follow my postings know that I have had some major winners including LVS which has been the cash cow of all times for me. (in since $2.53 and currently 29.63) Because of these stocks I wanted to lock in some profits that the stock market could never touch and that is where I get back to real estate.

I have been dabbling in real estate lately but with funds unrelated to the market. I recently locked up a repo in California from my stock profits and paid cash. The deal itself is sweet but it's even sweeter that my trading paid for it. I will now hold this property until the real estate market recovers or I get a offer I can't refuse.

Now, back to building my cash up again and hopefully repeat this cycle. . . ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=98 Chart pattern misconceptions http://www.hotstockmarket.com/forums/blog.php?b=76 Mon, 28 Jun 2010 02:52:09 GMT I've noticed quite a few chart patterns being mislabeled here, descending triangles being called pennants for example, so I decided to write up a quick lesson with the aid of Stockcharts.com. Mislabeling chart patterns is very common among newer traders, myself included, so this is to help clear up any misconceptions about them. This won't cover every chart pattern, but will cover the main ones.


The ascending triangle is a bullish formation that usually forms during an uptrend as a continuation pattern. There are instances when ascending triangles form as reversal patterns at the end of a downtrend, but they are typically continuation patterns. Regardless of where they form, ascending triangles are bullish patterns that indicate accumulation.




The descending triangle is a bearish formation that usually forms during a downtrend as a continuation pattern. There are instances when descending triangles form as reversal patterns at the end of an uptrend, but they are typically continuation patterns. Regardless of where they form, descending triangles are bearish patterns that indicate distribution.




The symmetrical triangle, which can also be referred to as a coil, usually forms during a trend as a continuation pattern. The pattern contains at least two lower highs and two higher lows. When these points are connected, the lines converge as they are extended and the symmetrical triangle takes shape. You could also think of it as a contracting wedge, wide at the beginning and narrowing over time.





Flags and Pennants are short-term continuation patterns that mark a small consolidation before the previous move resumes. These patterns are usually preceded by a sharp advance or decline with heavy volume, and mark a mid-point of the move.




The rising wedge is a bearish pattern that begins wide at the bottom and contracts as prices move higher and the trading range narrows. In contrast to symmetrical triangles, which have no definitive slope and no bullish or bearish bias, rising wedges definitely slope up and have a bearish bias.




The falling wedge is a bullish pattern that begins wide at the top and contracts as prices move lower. This price action forms a cone that slopes down as the reaction highs and reaction lows converge. In contrast to symmetrical triangles, which have no definitive slope and no bias, falling wedges definitely slope down and have a bullish bias. However, this bullish bias cannot be realized until a resistance breakout.




The double top is a major reversal pattern that forms after an extended uptrend. As its name implies, the pattern is made up of two consecutive peaks that are roughly equal, with a moderate trough in-between.




The double bottom is a major reversal pattern that forms after an extended downtrend. As its name implies, the pattern is made up of two consecutive troughs that are roughly equal, with a moderate peak in-between. ]]> NoJobRob http://www.hotstockmarket.com/forums/blog.php?b=76 Turning a loss into profit http://www.hotstockmarket.com/forums/blog.php?b=97 Mon, 07 Jun 2010 02:30:54 GMT *Are you upside down on your portfolio since the markets melted down* or just have a stock or two that took a dive. If that fits your situation you... Are you upside down on your portfolio since the markets melted down or just have a stock or two that took a dive. If that fits your situation you are not alone as a high percentage of investor/traders are in the same boat. We could analyze what went wrong but instead lets try to fix the problem and turn your losses into profit. In order to accomplish this goal you will need a plan and I will offer what has worked for me. It comes with some risk but I will try to trim the risk down to a comfort zone. It will take patience and fortitude to accomplish this goal. A fair amount of cash in your account, will increase your odds but if you have no cash we can work around that as well.

First off you need to decide if you want to keep each stock or sell it and use the funds for a better stock. Lets kick the tires and see how it checks out. Is it outperforming the S&P? Is smart money buying or at least holding? (this can be checked with the OBV indicator (On Balance Volume)) Does the price bounce back up when the market starts to go back up? If you answered yes to these questions it should be worth holding to move on to the next step. If it does not pass the test you may consider selling it on the next bounce up and buying a better stock to recapture what you loss. If you answered no to some of the questions then there is a little bit of grey area for you to contemplate. If any of these questions are greek to you, feel to ask questions on this blog or my trading thread: http://www.hotstockmarket.com/forums...=68388&page=58

Example: You bought 1000 shares of XYZ @$10 and the current price is $8 and you are down $2,000 or 20%. Sound bad? It's actually worse as it takes a 25% gain to get back to even. You did not use any money management and lets say you have no cash. Ok, lets cut to the chase and trade our way out of this mess.

Step 1
The trading range of XYZ has been between 7.48 and 8.50 so when it hits the bottom from the top it has a 12% drop. Because you have no cash you will have to wait until the price hits near the 8.50 to start the process. Lets say you sell 25% of XYZ @8.40 for $2100 and you are probably saying why not 8.50. Because the markets are so choppy right now so don't get to greedy and miss a selling opportunity. The worse case scenario is if the price keeps going up and you have to watch the rest of your longs keep rising and you will have to wait for the next pull back.

Step 2
Ideally we want to buy at 7.48 and sell at 8 or above for a minimum 7% gain. We want to make this buy on a day when the markets are selling off and even better if the markets are oversold as well as the stock and near its support. Because of the market uncertainty you may want to buy with half of your dedicated buying power for this stock. (not half of your cash). The worse case scenario here is that the price drops considerably below your entry price. Well, you are much better off that you sold 250 shares at the 8.40. Let's say you felt like taking the risk and used your $2100 and bought 280 shares of XYZ for 7.50 and later sold @8.03 and now your cash and XYZ stock is valued at $6022 and you still have 750 shares of XYZ and have $2248 to make the next buy. You have two options now: You can pocket the profit or roll it into the next trade. Its just a matter of repeating the process until you are back in the green. depending on the market situation you may have held your sell for that $8.50. Maybe XYZ got a buy upgrade or the markets were extremely bullish that day. You will have to make that call as this is just a basis for getting back to even and more.

Alternate Step 1
If you had the cash and took the risk and bought off the bottom before your first sell why not sell those 250 shares and a additional 250 shares which will speed up the process immensely. (that is the 25% you would have originally sold if the sell came before the buy)

I made this quite conservative, minimizing the risk and you may want to tweak the numbers. Don't let fear and greed keep you from profitability. If you have the cash you may want to buy if the bottom surfaces first but the safer way is to make the sell first. Again patience is a must as this will have to play out over numerous trading sessions to recapture your loss depending on how upside down you are.

Final thoughts: Because of the choppy markets if your in the money you may want to lock in profits as you never know what the next trading session may bring. A little profit is better than a loss...You can always come back to play another day...TTT. . .

* You may want to check back later as I have a habit of adding more info that I may have left out. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=97 Big Euro spike http://www.hotstockmarket.com/forums/blog.php?b=96 Tue, 01 Jun 2010 16:12:17 GMT That was an impressive move we just saw on the Euro, thanks to some intervention from the ECB, the EURUSD pair just moved from 4yr lows +200pips to... That was an impressive move we just saw on the Euro, thanks to some intervention from the ECB, the EURUSD pair just moved from 4yr lows +200pips to 1.2351.

If you dont trade forex, that is a really big move in a very short amount of time.



Since the markets are watching the Euro for direction, if they can move the Euro like this, the markets may follow.

Tail wagging the dog? ]]> StockJock-e http://www.hotstockmarket.com/forums/blog.php?b=96 Morning Call - May 28 http://www.hotstockmarket.com/forums/blog.php?b=95 Fri, 28 May 2010 14:05:40 GMT Good morning traders! Yesterday I said bias was to the upside and very much so if 1090 got taken out on the ES futures. Thankfully that worked out... Good morning traders!

Yesterday I said bias was to the upside and very much so if 1090 got taken out on the ES futures. Thankfully that worked out well and we got to see a sweet melt up!



Today is going to be like the morning after a huge frat party. We all got drunk and partied hard, now we are waking up a little groggy and not really sure who the girl lying next us is.

Im not doing much in the first hour, just watching to see how the market is opening up. Everybody was stumbling over themselves chasing stocks into the close, today we get to calm down a little ahead of a long weekend.

Consumer spending came in for the month of April as the worst since the same period last year, this is before the market tanked, so you can bet that June numbers will be bad.

Europe was relatively flat, not much action there.

AAPL is gapping up, Cramer was pumping it last night, sales of iPad are expected to start rocking in Europe.

Market sectors are mostly in the red which can be expected after the way everything closed on the highs.

It is still to early to tell, but it is possible that once the morning profit takers are done, we could get some lift, but then we have the long weekend ahead of us which could encourage some sellers to step in.

Im watching the Euro which had a great run yesterday, the low 1.23 area is support today, if the Euro can hold the supports, that would be bullish for the market sentiment.



We will probably see some chop to both sides today, Im just SOH (sitting on hands) for the first hour. ]]> StockJock-e http://www.hotstockmarket.com/forums/blog.php?b=95 How to play a Meltdown http://www.hotstockmarket.com/forums/blog.php?b=94 Sat, 22 May 2010 00:06:05 GMT *There are various ways to to trade stocks when the markets are spiraling down out of control*. The best is probably to short the market as long as... There are various ways to to trade stocks when the markets are spiraling down out of control. The best is probably to short the market as long as you don't get too greedy as many traders got caught up in today. Of course the same can be said for going long when the markets are bullish. Its about taking your profits before the market takes them back from you. I would be shorting the market myself but that is not a option for me in my IRA. With that I do what works for me and that is doing some quick flips. A trader must always adapt to market conditions to survive or you might as well sit on your hands. There is nothing wrong with sitting out the market until some stabilization sits in but I like the challenge and trust me it is a challenge and patience is a must until you see your opportunity.The following is my criteria for playing a major meltdown as we have been witnessing. I had made this post on Thursday prior to todays bounce.

Example: Dow down between -250 to -350 or more
Markets need to be oversold (which they are right not)
Stock must be at least at lower bollinger band
Stock must be oversold
Nothing fundamentally wrong with company
If short interest is low, starting bid at a -5% drop
If short interest is high, starting bid at a -10% drop
With any bounce profits need to be locked in.
If your not tier trading (risky in this type of market) then make sure your stop is in place
No trades in the last hour of trading
If I don't execute any bids no harm done and I will wait for the next game

*I have not been posting all of my plays but a couple can be witnessed in the LVS and BYD threads. Because my trading is so intense right now it is difficult to always break away and post. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=94 Real Estate is doing great!.... NOT! http://www.hotstockmarket.com/forums/blog.php?b=93 Thu, 20 May 2010 15:12:02 GMT From our friends Goldman via Zero Hedge:

Delinquencies and Foreclosures Rise Again

Data just released by the Mortgage Bankers' Assn show that more than one-tenth of all US mortgages are delinquent, a new record high. Homes in foreclosure edge up slightly as well. One caveat: the increases are driven by seasonal adjustment, which should probably be taken with a grain of salt given the huge shifts in this sector over the past few years.

Mortgage delinquencies: 10.06% in Q1 (Q4: 9.47%).
Mortgages in foreclosure: 4.63% in Q1 (Q4: 4.58%).

KEY POINTS:

1. The Mortgage Bankers' Assn Q1 report shows a further rise in delinquent mortgages, even in the 30-60 day range, somewhat surprising given the improvement in the economy and labor market in recent months. The increases are spread among both fixed and adjustable-rate mortgages, both prime and subprime; only FHA mortgages saw a lower delinquency rate than the prior quarter. One issue here is that the delinquency figures incorporate a positive seasonal adjustment, which should probably be taken with a grain of salt given the seismic shifts in this sector over the past few years (in fact, the MBA itself notes this issue; see http://www.mbaa.org/NewsandMedia/PressCenter/72906.htm). Before seasonal adjustment, the figures generally show improvement.

2. New foreclosures continue at a substantial rate of 1.23%, the 9th consecutive quarter where at least 1% of mortgages went into foreclosure. The total inventory of foreclosures (non-seasonally adjusted) rose to 4.63% of the stock of housing in the MBA's survey (just over 2 million homes in foreclosure).

From Goldman's Jan Hatzius.





]]> StockJock-e http://www.hotstockmarket.com/forums/blog.php?b=93 Its time for Hardball http://www.hotstockmarket.com/forums/blog.php?b=92 Sat, 15 May 2010 02:02:50 GMT *Its a tough market out their right now* and a trader has to get just as tough. Unless your short its time to roll up your sleeves and go with the... Its a tough market out their right now and a trader has to get just as tough. Unless your short its time to roll up your sleeves and go with the low ball bids. When your in the money you might want to take some chips off the table before the market takes it back. You always want to have cash on the table for when those golden opportunities come along, so trade smart and build your funds up. If you want to wait for the market to stabilize that's ok too. If your going long, you still want the best price you can get and I prefer to do it in tiers.

The best stocks to buy in a market meltdown are stocks that have been in a uptrend. I don't suggest averaging down on a loser as it could become extremely toxic if the market does not move back up. Even a good stock could become toxic if the market does not bounce back up and that is the risk a trader takes if if he is counting on a bounce. This is why a stop is your friend if the trend continues down. Remember, you don't always have to trade if you have uncertainty. You can always come back to play another day.

When I saw how bad futures were this morning and on a Friday I moved to percentage drops as support levels are easily broken especially if there is high short interest involved. Per example I had 6 bids in today and only executed one. On the trade I executed I dropped my bid four times before I bought. I did this as the price got near my bid I had my eye glued to Level 2 and Time & Sales and of course what direction the market was moving and how fast. When I did not like what I saw I would drop it down again. I could have got upside down if the market had dropped further down but my stop was in in my comfort zone. I was fortunate enough to buy one cent off the bottom and then get a friendly bounce near the close. The bottom line is that when your playing hardball and you don't connect, no harm done. You can wait for the next game.

A trader must adapt to market conditions as they change all the time. You must have a idea of where a stock is headed before it gets there and when it gets close to your entry point you need to give it a second look. Is it dropping fast on big block trades or is it being nibbled down slowly and is it lagging, leading or just in snyc with the market. If your in tune with your stocks and the market, you might just come out on top.

I normally start my bids between -5% to -10% from the previous days close depending on the short interest and trading patterns. A little tip to the new traders here is that before you make that buy make sure that your stock will bounce. If the market starts to go back up and your stock doesn't move up, it is probably not going to be a good play. If your stock is in sync with the market and moves up when the market goes up then at least you have established that it will bounce. Now its just a matter of finding the bottom.

I am not saying not to pay attention to the charts as support levels are important but in melt down conditions the charts may have you watching the bottom fall out of your trade. I have also seen a lot of discontent in different threads with statements like the stock is a pos and such. Even some of the best stocks can look like losers when the markets are spiraling down. If your not happy with a stock why not just move on instead of spreading doom and gloom to the other HSM members...Cooler heads prevail...TTT. . .

GLTA:Thumbsup: ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=92 Black Swan! Dow -998! http://www.hotstockmarket.com/forums/blog.php?b=91 Fri, 07 May 2010 03:33:00 GMT It sounds like this will all boil down to HFT (high frequency trading). We will get greater details in the coming days, I will update more at that... It sounds like this will all boil down to HFT (high frequency trading).

We will get greater details in the coming days, I will update more at that time.

Update 1: The drops in PG and MMM account for 400 Dow points. While the NYSE halted PG for 90 seconds, ECN's like ARCA traded around the temporary halt and at least 4000 trades went through at prices lower than the NYSE halt. Stocks like EXP traded down into the pennies when bids vanished but market sell orders kept coming in.

Update 2: So... its been a few days now since the "flash crash" as its come to be known, and guess what? Still not good explanation.

To quote the character "Data" from Star Trek quoting Sherlock Holmes:

"When you eliminate the impossible, whatever remains--however improbable--must be the truth."

It seems to me that the improbable fact is that what we saw was actual selling. The selling came in hard and the bids got pulled, simple as that.

The only thing the regulators can do is try put in some breakers to try stop it from happening again.


]]> StockJock-e http://www.hotstockmarket.com/forums/blog.php?b=91 My Playbook http://www.hotstockmarket.com/forums/blog.php?b=90 Sat, 01 May 2010 14:35:17 GMT *Like a football coach I have a playbook that I am looking at for the next game.* Each night I set up my buy and sells on stocks of interest. With... Like a football coach I have a playbook that I am looking at for the next game. Each night I set up my buy and sells on stocks of interest. With that, the stocks that are already in my portfolio get special attention. Do I want to up my position in some or get ready to change horses in others? I am weighing where I want to buy as well as my exit strategies and and even more so if it looks like the market might sell off.

In after hours trading I am tracking any big money that might be flowing in or out which I will pick up on my Time & Sales screen. Institutions and Mutual Funds move the market I want to be on the right side of their sentiment. Even if I don't see any massive block trades I am still looking for some movement on strong volume. More times than not this will indicate the next days direction and more so if there is a follow up in pre-market. Of course nothing is a 100% lock and a market can trump a extended hours indicator if it is moving strong in the opposite direction.

The next morning I am looking at pre-market for unusual volume. If the futures are up and one of my candidates are up but on lower volume than usual, I will be looking for a reversal and if it is down on low volume when the futures are down maybe it is ready to go up. I call this pre-market sentiment and it works more times than not and if the market reverses from early morning sentiment the odds go up in my favor. If market sentiment does not change, no harm done.

A example using LVS
I have seen futures up for what appears to be a good pop for the markets and LVS is up a little on low volume. When LVS is ready make a run it normally has a nice jump in share price accompanied with strong volume in pre-market. When it is up as I described I have seen it wind up being negative for the day and if the market decides to go south look out below. When a stock has high short interest it must have decent positive volume or the shorts will have it for lunch.

I also keep track of the options on each underlying stock to see where sentiment is at.

I don't just increase my positions just for the sake of it but by doing my homework. I try to gauge where these stocks will be in the short term but also as a investor I am looking a year or two down the road. Recently I decided to increase my positions in stocks that I already own, so I laid it out on how many shares for each stock I wanted but I didn't just jump in and buy them but waited for the prices to meet my targets. I give consideration to my cash balance as I only want to use a comfortable amount and preferably when the market is selling off.

From my playbook here is an example of one of the stocks that I increased my position in as I used multi-tier buying that I will cover later on in this blog. This post is from last Friday before the market melted down>

Quote:
Originally Posted by Tiptopptrader View Post
krishmk, I don't know how you are positioned into LVS but here is what I am doing>

On the Road to 30
I have bought the most shares in the last few weeks since I did in March of 09. With that I am still holding 1/2 of my 22.63 and a few other trades. I am getting close to taking some profits on the road to 30 and I will tier out of these trades as I bought in. I hold my swing trades longer than most traders here but my strategy has been fruitful. I remember holding a 12.54 and 13.39 and didn't cash out until it broke 20. I have not always held this long on other LVS trades but as the blocks have been falling in place, I have increased my target prices. I originally put a $35 target on by years end but if the MBS does as well as predicted, Macau sustains, Vegas recovers somewhat and PA with table games I would have to conservatively make it $40 by years end or at the latest on the Q4 if there are any big bumps to deal with.
Once in a while I will add to this post and maybe give another live example. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=90 Changing Horses http://www.hotstockmarket.com/forums/blog.php?b=89 Sat, 24 Apr 2010 17:07:41 GMT *Occasionally,** I re-balance my portfolio*. I give a few stocks the boot that have fallen out of favor with me. Per example I dumped MGM in March... Occasionally, I re-balance my portfolio. I give a few stocks the boot that have fallen out of favor with me. Per example I dumped MGM in March of 2009 and replaced it with LVS as I still wanted a stock in the gaming sector. I replaced S with Q months back as I still wanted a stock in the telecoms. Both of these swaps worked out well even though S is now showing some signs of strength. The bottom line is while I would have been waiting on MGM and S to make a recovery I was already taking down some big profits on LVS and Q. When stocks stop performing it may be time to pick up a replacement stock. Your replacement does not have to be in the same sector but I prefer to stay diversified and to be in sectors that will excel in a recovery. Last year my mutuals did great but not as good as my trading account. I have been in the process of changing that horse since the beginning of the year. So far I have transferred over about 40% of cash to my trading account and I have noticed a big difference to the positive side as I have stilled out performed my mutual funds. I do not recommend this move for the novice trader because it can become toxic to your overall value if your trades do not perform well. Today is celebration week for me as LVS broke though $25 and is now up a 1000% since my original buy. That swap is with out a doubt the highlight of my portfolio. I have been asked to update my holdings and from the list below I am getting heavy in financials again so one may get the boot soon.


Current Big Board Holdings
LVS F Q CLWR AMD C SYA BAC JNS

Penny Plays
EVSP(E)

MY Calls
C Q MPEL

*When your horse needs a breather, you need to find another ride but keep an eye on that horse as he might want to run again some day...TTT. . . ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=89 A Traders Mindset http://www.hotstockmarket.com/forums/blog.php?b=87 Wed, 21 Apr 2010 01:43:13 GMT Have you ever noticed that some traders are always talking down their trading and a common quote is that "if I sell it is sure to go up". I have heard that numerous times as traders can get down on their self when they suffer continued losses or maybe they are even making a little profit when everyone else is killing the market. Like any endeavor we all need a positive attitude but it is difficult when all is not going well. When you are down on your self it is easy to keep a negative mindset as you may start to trade emotionally and recklessly. You might start chasing stocks, taking big losses, afraid to pull the trigger when opportunity knocks or even let your profits slip through your fingers. I have seen the same scenario play out on the poker tables here in Vegas as players will start throwing good money after bad. If this should happen to you I suggest to get away from trading for a while and clear your mind. Yes, maybe you will miss that home-run or you might just keep falling off that cliff. Take that breather and read and study. Doctors, Lawyers and other professionals go to school to learn their trade before coming into their own. The successful ones have a positive attitude because they learned, applied and became skillful. You might not go to a stock school per-say but the more you learn and apply yourself will be a big step in the right direction.

Trading should be enjoyable and of course that is hard to do if you are losing your nest-egg but just like on those poker tables the angry and disgruntled players usually lose where the calm, and happy players do much better. I don't know if Tony Robbins ever traded stocks but with the type of attitude he has I would say he would probably be a shoe-in for success. You can also pick up negativity from other people as it is catching but more so in the real world and not the net. As I am currently a bull I don't take much heed when I see traders bashing stocks even if their post has some creditability as I don't want to catch that negativity. The mind can be easily influenced and just like in the real world, you need to be your own man and not let anyone bring you down.

I have no doubt that I could day-trade with success even if I only traded LVS but I enjoy swing trading as it is much more laid back and no stress compared to working a tighter window and having to keep your eyes glued to the screen. Like any job you want to do what is fun and rewarding to you and not just in the monetary sense.

I have had a lot of requests which I will eventually get to but I really don't want to pressure myself with a agenda as I like to
write about what interests me at the time. Like I said in the beginning my time is limited and I will take this blog slow and easy. With that said feel free to post your requests and I will put it on the list. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=87 Money Management http://www.hotstockmarket.com/forums/blog.php?b=86 Sat, 17 Apr 2010 02:05:40 GMT *This post is directed to new traders and traders that have found their self upside down on their portfolio.* Trading is like have a business and you... This post is directed to new traders and traders that have found their self upside down on their portfolio. Trading is like have a business and you are the boss. If you had a business that was losing money, you might be forced to close the doors. The same goes for your trading account. If you lose all your money, the game is over. The deeper you get in the hole the harder the climb back to even is. Let’s say you started with $10,000 and you have lost $2000 for a drop of 20%. Now you need to make 25% just to get back to even not counting your broker fees. You might say that you only need to make up the $2000 you lost and you would be right but now you are working with $8,000 and the percentages are working against you as the lower your portfolio value goes. Drop by 50% and now with $5,000 you need to make 100% to get even. What went wrong? Besides probably not getting a good entry price my guess would be that you did not use good money management. We will get to entry prices later on in the blog but money management is a must to stay ahead of the game.

As an example using $10,000 you decide too set each trade for a $1000 and you will set up a stop loss order to never lose more than 5% on each trade. Using these numbers you could lose 128 round trip trades in a row before you were down to your last thousand dollars and that includes $20 in broker fees. Most likely you would not lose that many trades in a row but if you had only 50% winners and maximized your profits for a average profit of 10% you would be $740 dollars ahead of the game. Now that doesn't sound like much for all that work but it would keep you above board while you are learning. When you become a better trader you should be able to win more than 50% of the time and maybe bring in more than 10% in average profits. Much depends on the hold time on your trades that determines your profits. My swing trades last any where from 2 days to weeks depending on the variables which I will cover later on.

It is suggested by many never to never lose more than 2% of your capital on any trade and the above comes out to less than 1%. In other words the training wheels are on until you can start knocking down the profits on a regular basis. In my opinion this is a step
ahead of paper trading but at least you are doing it in the real world and experiencing some risk until you become a good trader.

The example is basic but I think I made my point. Money management is a crucial part of being a successful trader just like it is for a business, a professional gambler, or even a family. If you’re a trader currently upside down on your portfolio with not much hope in sight I suggest to stop trading for now, take a breather and learn the right way to trade. If you’re new to the stock world you need to learn before you jump in with both feet. There are plenty on books out there or you can even click on the education tab above.

The numbers that I provided are hypothetical and subjective and you may come up with your own percentages that will work for you. I normally shoot for a higher percentage win for my swing trades but if I should get a 10% bounce on day one I may turn it into a day trade and take my chips off the table then and there or at least ½ just depending on where the technicals and market conditions are at. Later on I will cover buying and selling by using technical analysis as your guide. Regarding stop losses, I treat each stock different depending on the the volatility, market conditions, and support. It is ok to take a loss on a stock as that is part of the trading game but to be considerably upside down with no hope in sight is not a position that you ever want to be in. If you are considering averaging down remember don't throw good money after bad as that is not good money management. You will never find me in a trade that I am not comfortable with the loss. I have been known to take my loss and come back another day if I really like the company but if I can’t get on the positive side it is not for me.

Even though $1000 is considered small to play big board stocks that would be adequate to play on 10K of capital. If you use the stop losses as suggested you will have a fair chance of success with out taking big risks like wagering half or all. If you do well and build up your capital then you can move on to the bigger trades. If you’re a complete novice you might even consider paper trading until you get the hang of it.

From the following link you can download thinkorswim software, which is great for paper trading.
https://mediaserver.thinkorswim.com/...r/install.html

The bottom line is to protect your capital by minimizing your losses and maximizing your gains and money management is crucial to stay a float and hopefully you can watch your money grow. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=86 Playing with the Houses Money http://www.hotstockmarket.com/forums/blog.php?b=85 Mon, 12 Apr 2010 22:39:19 GMT I had intended to write about money management for my next post but I will touch on playing with the houses money as I did just that today. What... I had intended to write about money management for my next post but I will touch on playing with the houses money as I did just that today. What better odds is there than to make a play with no risk. The only gamble is that I could lose my profits but I still will have the option to trade out with some profit should Q go south. I like my odds on this scenario. Now that I have posted this for the whole world to see I will try to update the results every week or two and see if I made the right decision.

From TipTops -Top Picks http://www.hotstockmarket.com/forums...=68388&page=43
I repositioned my Q calls and it went like this>
I sold out of my April $5 calls for a 400% profit and rolled the profits into other Q calls.
I increased my May $5 calls with a partial fill @.50 which averages me at about .40
I bought July $5 calls @.50
I got a partial fill on the October $6 calls @.15 and I had the only trade on 10 contracts...hmmm...After my buy the spread went to 15X.30

I could have took my profits a walked away but because I am playing with the houses money I am taking this to the next level providing Q keeps performing or at the minimum the 5's stay in the money. ]]> Tiptopptrader http://www.hotstockmarket.com/forums/blog.php?b=85