milesofstyles ,
n one of your posts you address shorting a 3 day move up of 30 pct and adding to
the short position if it finishes higher in the following days...how do you do that if
you immediately go fully margined as you've stated? seems you have conflict to your
strategy there,in consideraton of your strategy, wouldn't it be better to take half of a
position initially?
This is not my strategy. I offered it only compared to Doug R's ACT/IL pattern, both of them can indicate oversold condition. My self always use margin.
second, not developing your trade plan before entry seems to me to be very
dangerous, almost amateurish for daytrading/short term positions. at some point, this
allows the emotion of a position to enter the picture by not having a target/exit
strategy. many books on trading discuss this topic at length, its at least been my
experience when i don't adhere to my plan, or didn't have a plan, i don't know what
the basis is for an exit and losses become worse.
I think one can't do well by planning before entry. Market situation is changing, technicals factors are not clear at the time of entry, that is, I may know a stock will go high but to what extent I have to wait the stock's action later to show me its further potential. If you saw my BEAM trade, you may find I exited on next day morning when I found the stock lost its steam, but I had expected it to go above $30.
This has nothing to do with emotion, but depends on one's technical strength.
When I mentioned "not to be called on margin", that was for the worst case, the probability is very small, but I have to prepare for that situation. If I really thought the probability is relatively high, I would exited by the end of the day. Actually in that situation the best I should do was to hold. By fundaments the stock was still more likely to go up, but techs showed the chance was lower than previous day and its immediate downward probability increased, margin call situation may occur but still very small. I exited at yesterday open, because I thought that time the chance was high enough for me to exit. Although the stock is up now, I still think I was doing a right thing.
As for using full margin, I admit my action is not appropriate from a money management view. But my nature loves gambling, and this practice made me more sensitive to short time stock movement and I am doing well with it. This is my game and I don't recommend anyone else to do.
I also never read books, stock market is a war between people, you have to do better to beat others. Once a knowledge become known to public, it becomes useless.
For the guy,
Subject 23993
He used to post his real time trades, I was watching his 20-30 trades, each last for 1-3 days for about 20% gain,(like mine but no margin),only one had a loss position over 3 days but he held it after longer time for a bigger gain. Now he no more post trades for free, he charges $400-$1000 per month and got a couple of hundred customers.
He used to be a market maker and has lot of market experience, especially has a superior ability to interpret company news and precisely judge the impact on stocks. But his TA is not so good compared to his fundamental ability. Only that he has some real time money flow information that others may not access. |
