A large part of successful trading is understanding how others are positioned in a stock and using that information to your advantage. One of the most common triggers for opening a short position in day trading is a drop of multi-day support. The idea being that many longs will have stop orders below this level, which will lead to a … Read More
A Quick Lesson in Tape Reading (ESRX)
I was long ESRX. It had gapped up on positive news. The first moves on the tape in the stock were positive. I liked the move above the open high. I liked the way it moved away from prices. I liked that above 56.50 provided a clear entry if it held above. The idea was shared on SMB Real Time: … Read More
AAPL Can’t Go Up Forever…
This post is the second in a series that we will be publishing over the next month , tracking the hypothetical performance of broken wing butterfly trades selected by Greg Loehr of Optionsbuzz.com. Apple can’t go up forever. Or can it? This week I’ll be tracking a hypothetical broken wing butterfly on Apple Computer (AAPL) that won’t lose money if … Read More
Five Things I Wish I Knew About Trading When I Started
Like any challenging pursuit with a steep learning curve, trading requires an incredible amount of determination in order to succeed. If we are successful, there is the temptation to look back to our beginning and to shake our heads at our combination of naiveté and the youthful enthusiasm that allowed us to overcome it. While reminiscing, we can also ask ourselves: … Read More
I See Momentum Buying
I settled at my trading station wondering what to trade on this Open. RHT? BBY? AMLN? There had not yet been a price spike on the SMB Radar in health care yet but I would later ask what and where to buy for that sector. BBY showed some consistent selling at 25 so I scalped that down to 24.60 on … Read More
My Thought Process: AMLN
We received a few requests for a trade review of the AMLN trade I was tweeting during today’s Open. I’ve illustrated my key thoughts via the annotation of the chart below. Let me outline some of the “bigger picture” considerations that are not covered by the chart annotations: It was reported that AMLN received a $3.5 billion takeover bid which … Read More
Trading Equities versus Eminis
Eminis are futures contracts for various indexes, commodities and currencies. Eminis have their own trading personalities just as equities, and just as GOOG trades differently than WMT, each of the Emini contracts has their own trading personality profile. There is no *right* market to trade just as there is no one trading style that meets the needs of all traders … Read More
The Market Discriminates Against the Over-thinker and Ill-prepared
Hi Mike, Never wrote you, thought I would try. Had a question. In much of what I see, read, etc., there seems to be a focus there on recruitment and somewhat of a preference to younger people as new traders on your prop desk. PLEASE note that I am not looking for an age discrimination claim here, lol. It’s just … Read More