December 3, 2008
Ultra-emotional, Double Stress, 2x Moody
You’ll recall my bragging about the buy signal in the Ultrashort Financials (SKF) at $169 after it closed above $260 just three days later. SKF traded above $300 the next day and then reversed, collapsing to around $110 over the next week. The entire time my model said “sit.”
The kind of volatility we’re seeing in the Ultra-ETFs makes for great day trading, but for a system that works off weekly prices, it wreaks havoc.
Cat: | Time: 9:50 am (utc+8)
December 3rd, 2008 at 11:52 am
Oh, give it 24 more hours….
December 3rd, 2008 at 11:56 am
does not make great for day trading either… most days they are gaping and then chopping around with long tails and volatile actions taking out stops left and right… i think i had two days in the last 2-3 weeks were a good solid trend got established during the day and all other days have been nightmares to trade.
December 3rd, 2008 at 12:01 pm
@Hudson: Yes, indeed, it may go to Ultra-idiot levels before the system says exit. :)
@Born2: Looking at the intraday SKF chart, looks like there are quite a few trend days, but you’re in the fray and I’m not, so you know better.
December 3rd, 2008 at 12:54 pm
Hi Mao, I am looking at your trading for dummy series. I have gone over several of them, but am too inexperienced to deduce the pattern on the charts.
Do you have a post summarizing the main concepts and rules to day-trade by?
I know the importance of predefining losses and cutting losses quickly (with a physical stop loss), and risking only a small percentage per trade.
I am especially in how you decide where to enter and exit trades using the intra-day 15-minute charts.
December 3rd, 2008 at 2:17 pm
@dante: NO, there’s no single post summarizing things but if you read through all 95 lessons you should begin to get the picture. You want to enter long above down bars and inside bars after an impusive move up, and short below up and inside bars after an impulsive move down… that’s the basic idea.
December 3rd, 2008 at 11:14 pm
Do you mean enter when there is somemthing similar to an intra-day retracement?
December 4th, 2008 at 6:32 am
Wrong 24 hours.. SDS and SKF closed Exactly on the rising trendline. The next session shall show if this bear can rise or not.
December 4th, 2008 at 7:38 am
@dante : Yes.
December 6th, 2008 at 8:01 am
5) When would you stop trading for the day?
5) Right after you enter the position or lunchtime, whichever comes first.
Does this mean you usually enter only one trade in the morning on any day?
December 6th, 2008 at 8:33 am
@dante: No, not necessarily. I was just trying to encourage people not to overtrade by including those two lines in every lesson.
December 6th, 2008 at 8:33 am
From one of your dummy series:
“The answer is that good trading is 10% methodology and 90% psychology. People defeat themselves.”
By psychology, do you mean breaking your own rules, such as removing stops, and not taking profits?
December 6th, 2008 at 9:09 am
@dante: Yes. Can you email me questions instead of asking in the comments, please?
December 6th, 2008 at 11:40 am
Thanks for your reply.
Ok, will do if I have more questions. Sorry for clogging up the comments here, but those archived posts did not have a section at the bottom for me to post comments.