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Strategies & Market Trends : SOES Trading -- Ignore unavailable to you. Want to Upgrade?

To: Bernard Newman who wrote (1142)	11/14/1997 6:06:00 PM
From: Michael Friesen	Read Replies (1) \| Respond to of 1618

In regards to getting out quick - when a stock is moving against you. I stopped SOES trading in April 1997. I traded on the Watcher. Most of the time with something like INTC you could always get out except for rare times when the bid might drop a few more times on you. Once when COMS came out with bad news the stock dropped three points faster than anything. The top trader in our office happened to be long 1000 and hit his "monster sell" key, and was filled three points lower! But that's the only time I've seen that. So either your guys' software is slow, or something's changed in the markets in the past six months or so. So whoever reads this and trades on WATCHER (ie through Broadway Consulting) - are there indeed these problems happening? For those that are new to the game - don't think you have to be supertrader right away and trade INTC or MSFT or the other megacaps. There are lots of liquid, volatile, tight spread stocks out there. Remember, the best market makers like at GSCO are on INTC and MSFT, as well as the hedge fund traders etc (so there will be less "free money" lying around). So take a look at some stocks that aren't household names (yet). "But how do I find these, you say?" Well, you could use screening software and find stuff that trades say over 400K shares average per day, under $50 and has an average daily range of 1.25 points, say. Or look at some of the stuff on Spotlight (eg New Highs) in the different industry groups right here on SI; also the thread under Short-Term Traders called Lzzrd Kings Trading Swamp has guys discussing some nice but not well known trading stocks (they even post what they traded). Finally, here's one idea for making the lack of liquidity work for you (but I don't know how practical it would be). Let's say you see a stock tanking. Now punch a key to market sell 100 shares. Then wait until you get filled. Then buy 1000. If it is true that just when you get out is when the stock reverses, why not buy/sell small quantities to find those locations, and then assume that's a low risk entry point. Only if you're paying commissions by the share, though (since the idea of paying say $25 on 100 shares isn't appealing). Here's another idea for those new at SOES that I experimented with myself (you need fast fingers, though). When you're making money in a stock, say on the long side, instead of selling the whole bunch, offer out like 200 shares. Watch to see how "fast" it gets taken. If it gets snapped up, OK! At least you still have 800 and the market just gave you a signal to hold on. It nobody takes it, get ready to cancel and market sell instantly.