Short term - knowledge library 1.0 (This thread is READ ONLY.... No unauthorised Posts), page-4

ST Trading Strategies: Part 1
Collated by Kdoc
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Poster: pilsner

Date: 29/12/14
Time: 10:49:04
Post #: 14513632

as an example of how a stoploss is manually set as price is rising. the answer to your other question is yes profits are taken on the way up. The targets I use are fib extensions. You can always buy back at a lower or higher price when the next upswing break is confirmed. But at least you have banked some coin.


another example in the smallest timeframe. As mentioned this strategy will save your a majority of the time in whatever timeframe you trade.


Poster: 3500

Date: 30/12/14
Time: 22:55:03
Post #: 14520453

Margin loan (similar to CFDs)...Great in bull markets with proper attention to sector analysis.
A disaster in bear markets.
No place for contrarian approach.
A little example.
You have $100Ks in equity.....You borrow $400Ks to buy a boring stock like TLS at $3 & it goes up 100% in 3 years.
You sell them for $800Ks...Give you lender his $400ks & your equity has gone up 4 fold to $500Ks.
You can capitalize interest into the margin loan (you don't need to pay out of your own cash)
The interest you pay is tax deductible....With 5% FF dividend one nearly breaks even as far as interest is concerned.
Many stocks far outperformed TLS in much shorter periods & it is doable to churn your capital more frequently than a 3 year hold with far better returns...."catching" 5 or 10% move in mid & large caps within a couple of weeks is quite common....Entry & exit is instantaneous given the liquidity.
If one is consistently profitable with his own money ,there is a very good reason for gearing , but it is not for the "hit-and-miss" approach.


Poster: keygeo

Date: 04/01/15
Time: 14:31:07
Post #: 14533746

investing / trading the china A50 - it can be a widely erratic market tossing your investment all over the place...
at the moment its not so bad as its is going up consistently, but that will not be the case at all over a period of time ......

to being more in control and avoid loosing too much money i'm thinking a rough strategy of maintain a trailing 2% stop/ loss, but keep a trailing buy at say 4% lower than market with also a 2% stop/loss.... and also continuing the same strategy at -8% also.........the consequences of this is that -

1. if the price falls say a little bit less than 10% and then regains its upward momentum then I will have lost 6% (not 10%) but would still be holding an o/a upward trending investment with some 2 x 2% gains for the periods when I was not holding

2. if the price continues to fall below 10% where I would have stopped out for a the third time with a loss of just 6%, then its a decision to make whether there has been a reversal of trend, and then to stay out......

3. if the price reverses up during the periods that I am not holding, then its a decision to make as to whether I think the stock has now completed its correction and will continue its o/a upward trend, then I would buy back in...

sounds unnecessarily complicated - but I cannot think of a better way to be in some degree of control of an investment which might be in a steady upward trend, but still have large downward swings of say up to 10%

working this in conjuction with trading bands is also the other consideration ......



Poster: Ibza

Date: 07/01/15
Time: 16:07:34
Post #: 1454957

It's a book by Louise Bedford named 'Chart Secrets'. There might be better Chart books, not sure, but I've read 3/4 of this one.
I like her style of writing, it's not as dry as some other books. I either got it from Dymocks bookstore or from Booktopia online;
http://www.booktopia.com.au/search.ep?keywords=charting secrets&productType=917504
I'm reading the book, 'Trading In The Zone' at the moment, it's about trader psychology. It's a bit of a struggle, a lot of words for little message.

I've got a few other books on the shelf which I'm keen to read;

The Master Swing Trader - Alan S. Farley
How I made $2,000,000 in the stock Market - Darvas
The Intelligent Investor - Benjamin Graham
The 7 habits of highly effective people - Stephen R. Covey
The 4-Hour work week - Timothy Ferriss


Poster: Freehold

Date: 07/01/15
Time: 18:34:53
Post #: 14550343

Guppy trading books are also good for beginners and are available online.

In fact I liked the Darvas book so much that I spent 6 months about 10 years ago developing a a system to do exactly that... Plus a with a few "Freehold" enhancements...

For real beginners they are a few of Guppy's books such as Snapshot trading , Trend Trading, Trading Tactics which give decent overviews of what to do. Also Stan Weinsteins Secrets for Profiting in Bull and bear markets provide a good all round system for entry and more importantly exit sort like Darvas all round system.

I would add a few to the list though -

Trade you way to financial freedom - Thaarp
Mastering the Trade - Carter (More for advanced mechanical trading and futures markets)

Oh and REad through of VSR Volume spread Analysis by Gavin holmes .. can be downloaded online

but Darvas works best in strong Bullish markets in general... which is not what we have right now. Also because many people know the ins and out of Darvas stops many novices will set their stops as written in book which of course is too obvious a target for market manipulators as pointed out some days ago out, so some deeper sophistication is required for the exits. IMHO

But Yes a systems loosely based on Darvas can form the basis for a credible system... but I stress you will need adapt it to suit your own trading style.


Poster: jeans_sammy

Date: 07/01/15
Time: 20:08:57
Post #: 14550777

I do DT, hold for short, medium and long term. I have separate rules developed & has to be implemented for each of the trading/investing pattern. However, I am very flexible & quick in moving from one rule to another looking at FA, TA, market reaction for the particular stock and also behavior of global indices. Sometimes after FA & TA are aligned I buy stock from medium to long term but if going forward certain conditions are not fulfilled, I simply exit or reduce my holding. Also if Target is hit earlier than my expectation, i don't hesitate to take the profit.

It goes to the individual owner not to the stock. When you understand Profit is Profit no matter how small it is and stop being greedy, you will start putting your own profit target and once it's reached you will be exiting without any noise. Most important thing is the "Discipline".



Poster: Freehold

Date: 07/01/15
Time: 20:13:00
Post #: 14550802

YEs its Critical to have a Trading diary .. it is through this that you will be able to decide what rules you invent (or copy ) work and when and which ones to discard...

….On the exit, simple TA trades are often the easiest ... You sell into as much strength has you can find.. for example if the stock is rising fast and the commentary on HC for that stock is reaching fever pitch (Rocket to the moon comments ETC) its a sure sign its time to offload... sell into Novice Euphoria. Sounds harsh but the market takes no prisoners ... you can always re-enter if your timing is wrong. You cannot re-conjure a profit once the buyers have dried up. Also you will almost never get it exactly right so stop trying to pick the absolute top...

When taking very large FA based positions I often document quite complex sell strategies often taking several pages to describe as many as 10-15 sell trades or more and conditions for executing each one.



Poster: jeans_sammy

Date: 07/01/15
Time: 20:55:59
Post #: 14550973

How do we decide [to exit]. I believe it just takes some time to learn and I am sure you will get there slowly. Hence, Trading Dairy is very important tool and must be updated and reviewed periodically for lesson learnt.

You just need to keep close eyes on when train is running fast, then it runs faster, and as FH said you hear lot of noise on HC about going to the moon etc etc.....Once, its slow down or just when your heart says its enough, you just leave the train.

Another point in regards to Trading Table; once you start making good money, make sure you are taking some cash out to enjoy the life with friends and family. Also, Its even better if part of the money taken out (From profit) can be donated for good cause. "Rich is the one who earns the money and Richer is the one who spend the money and Richest is the one who earns, spend and donate the money". My DT table shows that i have cashed out more money than the capital currently available for trading. Giving me good night sleep