Aggressive Speculating/Trading - Aggressive speculating seems like a misnomer when many think of Wyckoff. Successful Wyckoff speculators are thought of as having a great deal of patience and discipline before they make a move. Their success is predicated on all five factors (see homepage) being correctly aligned before making a decision.
So what is an aggressive Wyckoff speculator or trader? They are the ones that take their positions as the move begins and in the direction of the move. Most frequently they trade intra-day to be positioned at the earliest moment that is possible.
How do they differ from most Wyckoff speculators? A good example is a trader that take a position in a stock as it breaks out of an apex. That always occurs intra-day. They are taking their position as the price breaks the apex on volume that is perceived to be above normal. The more conservative Wyckoff speculator will be taking a position in the following days, in some instance, many days later as they wait for the proper pullback to confirm the break of the apex.
Why don't they just go in and buy the next day? Frequently, the reason is that the stock has already made a significant move and buying at a high could well put them in a situation where a closely held stop would take them out of their position. On other occasions, a move of 3%- 5% for the day from the break of the apex wouldn't allow the speculator to take a position until a reaction occurred. The speculator hoping for 10% for a short term move or 20% for an intermediate term move, couldn't take the position at a price that doesn't allow the potential profit percentage needed.
Aggressive Wyckoff speculating doesn't mean buying or selling on a whim or just because the over-all market action for a particular day looks inviting. No, successful aggressive speculators are only trading stocks that have meet and satisfied all of the five requirements for successful speculation. The main difference between them and most Wyckoff speculators is they are prepared to move intra-day as the move and turn in the market begins.
To be successful the aggressive trader has a plan. Their plan is different from the normal trader only from the perspective that they are prepared to move on the day the turning action begins.
For example, at this time most Wyckoff speculators are watching and waiting for the market to take an action that would provide evidence as to which direction the market is going to take. Is the market going to confirm the SOW or is a spring (potentially a SOS) going to negate the SOW?
The aggressive trader has already decided on the specific stocks that either action would provide a trade in. This trader has listed the best issues and if the action were to happen today, the aggressive speculator is ready to move.
For example, last night I reviewed all 437 stocks that I follow from my position sheet. Of those, 31 stocks are extremely well positioned for taking a long position if the market were to spring today. Of those, 14 were the strongest in the strongest groups, meeting and exceeding every condition Wyckoff would require. From those 14, I picked out the three that are the best of the best. They are ready to move and they are ready to move today. If the market enters an oversold condition intra-day and then springs, I'm ready to buy any or all three of these stocks if they make the move I'd expect they'll make. That's what aggressive Wyckoff speculating is.
Aggressive speculating is using all the Wyckoff principles, waiting for the appropriate time and taking the position as it happens in the stocks most likely to move the soonest, the furthest and the fastest.
Regardless of whether the trader is an aggressive trader or not, having a plan and making sure that everyday you are prepared with a list of stocks that meet all the Wyckoff requirements for either long or short (I also have a list of short candidates) is crucial for the short term. In many instances it is also crucial for the intermediate term speculator. It's not so crucial for the longer term speculator since their profit potential and time requirements are significantly greater. For them, being a few days late isn't going to make the difference between success or failure. |
