Hi Eric,
2009 is not looking a good trading year for me, I am struggling. I usually run a custom made scan one night earlier to find out the best candidates for short and long for the next day and trade those ones, but it's giving me dismal results. Basically my scan looks at the volume, close, open high, and low prices for the last three days, to single out the best short and long candidates for the next day. If the trend continues the next day I trade them, but lately it's not working, in fact if I do the opposite of what it tells me works better.
My question is what is a good way in this market to find out the best trading opportunities for the next day, does anybody use a scanner for this purpose, and if so what indicators they look into?
Any information is appreciated.
Greg,
I know 10-15 very successful daytraders and can tell you that none trade the same way. Instead, they have each found their own little profitable niche that seems to work for them over the long run. Some trade very low priced stocks (<$2) and trade very large positions (100k shares or more). Others are fully automated, with trend or counter trend methods. Still others are manual, and use scanners to find stocks that are moving sharply (looking for a reversal) or consolidating after a sharp move (looking for a continuation or reversal).
You should also keep in mind that 2008 has been a tough year for some normally solid traders. If you haven't already, I'd start by substantially cutting back on the share size of your trades. This is something I do whenever my trading gets into a bad period. Once your trading style starts working better, you can increase your size back up. In the meantime, you'd certainly like to lose the least amount possible while things are not working (or paper trade, and lose nothing). Have you noticed that you method has gone through 'cold periods' in the past and subsequently recovered? How long have you traded that style?
Sorry I can't help with more specific ideas on a new system. There are thousands of ways to be profitable in the market (but unfortunately, zillions of ways to lose money). Personally, I don't think I could make a dime trading manually, in the best of markets.
-Eric |
