All Entries in the "Tools of the Trade" Category
Day Trading: When to Take Profit
April 19, 2007 at 8:00 am
Day trading candidates are often listed in the Bandit Broadcast stock newsletter for the more active traders at TheStockBandit.com, offering some additional opportunities to grab some gains on an intraday basis. With earnings season underway, we’re still swing trading some, but right now is a good time to shorten timeframes a bit until the scheduled news passes.
While most day traders pay close attention to the price action, one of the most important indicators for short-term momentum can be found in the volume levels, particularly in relative volume. I keep a close eye on relative volume via Trade-Ideas Pro, a real-time scanner. Relative volume is the comparison between current volume levels in a stock and what the volume levels typically are for the same time of day. So for example, if XYZ is hitting highs on 2x relative volume, it is seeing twice the volume today as it typically sees for this exact time of day.
On Monday night, GROW was provided for our members as a day trade candidate in the Bandit Broadcast with a $31.50 buy point. The stock had pulled back slightly on the daily chart, but the pattern wasn’t quite clean enough to warrant a swing entry. There was a small descending trend line just overhead which was acting as resistance, and a push up through that level ($31.50) was likely to generate a quick pop to the upside. Here’s the original chart that was shown with the trade:
(Click for full size.) Chart Courtesy of TeleChart.
On Tuesday, GROW cleared the $31.50 buy point not long after the market opened, and quickly shot higher as momentum players jumped into the stock. However, the relative volume was only running right at 1 in my Trade-Ideas filter, which meant it was merely average volume. With the stock up $1.20 past my buy point (a 3.8% move) in less than 45 minutes, I decided it was time to ring the register. I posted my exit on the Bandit Bulletin trading blog for members, and moved to the sidelines with a nice chunk of change. The comment I made at the time of my exit was that it was “too good of a move not to book when volume is only average.”
That proved to be true, and I was relieved to have pocketed the profits as the day progressed, with GROW slowly fading all the way back to the trend line area by the end of the day. Timing really is everything in trading. Here’s a look at the intraday chart which shows all of Tuesday’s trading, including the gradual slide back down after our exit:
(Click for full size.) Chart Courtesy of TeleChart.
Sometimes the simplest things can be the most beneficial to watch. Trade-Ideas offers some amazing tools for day traders, and yet I seem to find ample value in the Relative Volume feature (they have several new features in the works as well). So the next time you’re catching a nice move in a short-term trade, be sure the volume is strong enough to support it. If it isn’t, you’re probably looking at the perfect time to book that gain and move back to the sidelines.
Jeff White
President, The Stock Bandit, Inc.
Swing Trading & Day Trading Service
www.TheStockBandit.com
[tags]Stock Market, Day Trading, Stock Trading, Investing, Swing Trading, Trade-Ideas[/tags]
TeleChart Platinum Sale
March 5, 2007 at 6:13 pm
I just received an email from Worden Brothers regarding a 1-week sale for TeleChart Platinum, their real-time charting program. I’ve been a TeleChart user for 8 years now, and this is the best sale price I’ve seen on their Platinum version (buy 8 months, get 4 free). It works out to $58 per month if you take the 2-year discount (buy 14 months, get 10 free), which is 71% off.
I’ve talked before about why I use this program and why it is the best charting program out there, so if you’re in the market for a charting program to give you a jump on your trading, be sure to check it out. Worden offers a money-back guarantee as well as a 30-day trial, which is impossible to beat.
(Their sale ends March 12th.)
Hope your week is off to a great start!
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
[tags]Stock Market, Day Trading, Stock Trading, Investing, Swing Trading, Stock Charts, TeleChart[/tags]
Trading Lessons & Worden TeleChart
February 8, 2007 at 10:20 am
In my previous post, I discussed the importance of learning from our trading mistakes to become better traders, citing one way we learn at TheStockBandit.com is through the Trade of the Week lesson. In this post, I want to show you a way to learn more from trades of your past – by keeping them separate and tracking them in TeleChart.
I’ve been a user of TeleChart since 1999, and I’ve never regretted paying for this great product. I talk a lot about the importance of using a charting program if you’re an active trader (an absolute MUST!), so I’ll leave that for another discussion (even though I still believe it!). What I want to point out here is how to use TeleChart to learn from your past trades, so let’s get to it.
Learning From Others
At 7pm ET after every market close, I do one last update of TeleChart for the final end-of-day data. I use their real-time charting service, called Platinum (find me on TCNet anytime, I’m TheStockBandit), so when the market closes I already have the ending numbers for the day. However, there are occasional minor changes in data from the exchanges after the closing bell, so the 7pm update includes the official closing levels and volume totals.
The 7pm update also includes an incredibly underrated feature – The Worden Report from Don Worden. Don has been in the market for many decades, and his trading experience is most likely greater than yours and mine put together. His nightly report alone is worth the price of their software, and I rarely miss his posts to see how he is viewing the current market conditions. In addition to his post, there are often trading lessons provided via submitted notes from other TeleChart users to Don, along with his response to them. While many of these contain over-complicated formulas for locating trade ideas which I ignore, there are some real gems that show up when other traders share their own trading lessons.
One recent idea was submitted by Sir Fertile Sources, who suggested something revolutionary yet unbelievably simple: create a separate watch list for stocks you have sold! Soon after, Sir Major Lessons added another layer to the idea by creating separate “sold” watch lists depending on the conditions which generated the sale (abysmal loser, stop loss hit, stop loss hit for a gain, booked substantial gain). The idea is to be able to quickly review those stocks which you have held and see not just how they are doing now but also how you may have improved upon your exit.
TeleChart Notes
The Notes feature in TeleChart is highly underrated. Pull up any chart on any timeframe within TeleChart and click ‘N’ on the keyboard. A dialogue box pops up with an instant capture of the chart as it looks right now. Enter your thoughts (the note) and click ‘OK’. You’ve just made a note which will forever be tied to the current chart view, allowing you to return at any later date and review your note. This is perfect for the “sold” watch list…..once you’ve sold your stock, simply enter a note, save it and move on. Later when you want to review it, you’ll see exactly what you saw when you made your sale, giving you an instant visual comparison to the current chart.
Notes are a one-click feature of TeleChart, allowing you to capture the chart and store your thoughts along with it. (The actual window can of course be resized).WatchList Tracking
The WatchList Tracking feature of TeleChart is often overlooked. This is an excellent way to track a portfolio or even just a WatchList such as the “sold” WatchList. WatchList tracking will do exactly what it says – track every individual component in the list and even provide averages for things like percent change and number of days. This is ideal for the “Sold” WatchList, as the program will immediately and automatically begin to track your old stocks and you’ll be able to pull them up at a glance at any later date to see how well or poorly they have performed since your exit.
WatchList Tracking in TeleChart is done automatically, which really streamlines the past-trade review process.Keeping it Simple
Every trader who is looking to improve can find great lessons in trades of the past. Trading can get real complicated if you let it, so take the easy approach to improvement when you have the chance. This new learning approach is already simplifying how I review my trades, letting me get to the application of lessons much faster. I hope it works for you just as well!
Take a free 30-day trial of TeleChart 2007 and see what it can do for your trading. I did, and I’m still using it 8 years later.
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
[tags]Stock Market, Investing, Stock Trading, Stock Charts, Chart Patterns, TeleChart, Worden[/tags]
The Best Way to Upgrade Your Hardware
December 18, 2006 at 9:48 pm
CyberTrader is running a pretty sweet promotion right now where any new account opened and funded will get you a free 17″ dual display. This is perfect if you’ve already done your holiday shopping but forgot to take care of yourself! The best part is that it doesn’t cost a thing, so you won’t feel a twinge of guilt. I already trade through CyberTrader for the best trading tools and executions out there, but maybe I need to open another account so I can get the free dual display!
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
I’m Really Pumped About This
October 9, 2006 at 2:05 pm
Last night at TheStockBandit.com we announced The Bandit Bulletin, a premium interactive trading blog which I’ll be writing on trading days for members. In the Bandit Bulletin, I’ll be helping members take their trading to the next level with intraday trading ideas, chart reviews, educational articles, detailed market commentary, and much more.
At TheStockBandit.com, we’re all about education, so this should be a huge benefit for those looking to learn as they look over my shoulder on a daily basis.
I get quite a bit of email from members with questions of all kinds every day (and I’ll continue answering it of course), but through The Bandit Bulletin everyone can learn simultaneously. The relaxed atmosphere of a blog just allows for an easy way to learn and interact with each other, so it should definitely be fun! It will also no doubt add a whole new dimension of service and greater value to the membership price (it’s included!).
Even free trial members can participate, so if you haven’t tried out the service with our risk-free 2 Week trial, what are you waiting for? Come on over and experience the award-winning service as well as my new members-only interactive blog!
(There’s also a Virtual Tour available if you’d like to check it out.)
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
Come trade with us!
Look Out IB!
October 4, 2006 at 9:16 am
CyberTrader just put up this page which points to some pretty exciting enhancements on the way for clients on the CyberTrader Pro platform (like yours truly).
I’ve commented quite a bit about CT and their great customer service and particularly their wonderful conditional orders. Well, the coming enhancements will add quite a bit of functionality to the conditional orders topic, particularly #4 on the list.
Needless to say, CT is about to take not only trade management but order management to another level with the coming features, and that means more flexibility for traders which is always a great thing!
I’m really looking forward to this and you can see the list at this page.
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
[tags]Stock Trading, CyberTrader, Conditional Alerts, Conditional Orders, Risk Management[/tags]
StockTickr Does it Again
September 21, 2006 at 8:45 am
I still can’t believe how inexpensive StockTickr is for such a fantastic feature-rich product. Even more, the guys at StockTickr are always working hard to improve and add new features to their already great product. Well, they just did it again.
Now when you enter and exit trades and post them in your journal (public or private – your choice), the StockTickr Chart Review automatically captures chart images for you and even notates on the charts where you got into or out of the trade. Even better, multiple timeframes are provided (5 minute, 10 minute, 15 minute, and 30 minute bars) as well as intraday charts of SPY and QQQQ to help you see what the market was doing when you got into or out of your trades. Any trader can see what a valuable tool this is to be able to review not only trading performance data generated by the StockTickr Journal, but to also see the charts of your trades when reviewing your results.
Check out the StockTickr Chart Review post for more details. And to the guys at StockTickr, keep up the great work!
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
[tags]Stocks, Stock Trading, Trading, Trading Journal, StockTickr[/tags]
