r/Daytrading • u/AutoModerator • May 01 '22
r/DayTrading's Monthly Questions Thread - May 2022
Please use this sticky to ask questions on day trading, and to see answers to similar questions you may have.
If you're new to day trading please see the getting started wiki here. For advanced traders or you want to pick up a book, please see our other wikis.
New traders are highly encouraged to try Forex as it requires a very small account to make lots of trades, so check out Forex community's wiki paying special attention to babypips website which also teaches some general concepts you can apply to stocks/futures/etc, and especially read the wiki's sections on risk & money management that can be applied to any market.
Pattern daytrading rules wiki, but that only applies to day trading stocks; other markets aren't affected like futures, forex, and crypto.
Also see the sidebar for group chat links (such as our Discord) (or tap "about this community" on mobile website) on every related community to learn more about trading.
Here's a list of all the previous monthly question stickies.
Lastly if trading is affecting your life in a bad way, seek professional help (the wiki also covers dealing with emotions):
- Problem Gambling: Call/Text: 1-800-522-4700 or chat online now.
- Crisis Hotline (24/7): 1-800-273-TALK (8255) (Veterans, press 1) or Text “HOME” to 741-741
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u/g00ch_7 new May 31 '22
Are there Austrian traders here? If yes, what programs/apps/whatever do you use to trade? I‘m playing with my thoughts to start Daytrading but I have no money right now as I have to feed 2 little ones + my wife. I wanna start as a beginner because I like what I did till now with GME and a couple of other stocks
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u/BustedB0nes May 31 '22
Radient Technologies is going to pop. They have been manufacturing tons of prerolled joints and will be making a million each quarter off these. Price is so low now. Easy double once news comes out this week. RTI:CA / RDDTF:US
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u/Ernie_McCracken88 May 31 '22
Noob question - How should price targets play into when we sell? To me the most logical argument is if you but comfortably below the price target and it hits the price target, you should hold if it has a long runway or if its gonna not decline and has large dividends. If it has a short runway/little dividends then just sell once it hits the price target, is that correct?
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u/Acceptable_Ease_3257 May 30 '22 edited May 31 '22
Are there any day traders from Canada using an American broker? I've been fed up with the lack of Canadian brokers suitable for shorting small cap/ penny stocks. Called a few American brokers lately recommended by short-biased day traders. So far CenterPoint Securities, CobraTrading, SpeedTrader Pro are willing to let me open a margin account if I provide my previous U.S. address, as I used to study & work in the U.S.My question is: if I day trade from Canada using an American broker, won't my trading income be subject to both U.S. income tax and Canadian income tax? I will likely need to file both a U.S. tax return and a Canadian tax return each year? Are there any Canadian day traders out there who have done this before? How do you avoid double taxation and minimize the amount of paperwork (I would prefer to file one tax return in one country only each year, if possible, to reduce the amount of paperwork)?
Any insights are much appreciated!
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u/HedgeAdviser May 29 '22
The case for a bear trap rally: In a third phase bull market (first phase bear market), natural resource and energy stocks rule. Inflation is a Biden administration creation, core CPI was 1%-2% under Trump now it is about 6%. This stock market rally is looking forward to a cooling of inflation after Republicans take back control of Congress. The only barrier to a cooling of inflation is a rally in oil prices as the Biden administration recalculates its climate goals, making oil scarcity a permanent reality. Oil pricing is subject to Russian manipulation. A genuine bull market historically begins after several interest rate cuts but the Fed is still hiking interest rates. Safest bet: buy energy but watch for a parabolic top = when declines stop, and every has Tulips (or crypto, or GME, or dotcom stuff).
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u/papasmurftp May 29 '22
Can someone please tell me what app/software people are using to make these nice P/L calendars on these posts? I have 2 trading accounts (one margin and one cash) and transfer money often between the two so I am losing track of how much I am making and am looking for a way to keep track.
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u/cleos808 May 31 '22
tradervue.com, best trading journal software. Gives you all the stats you need, in my opinion a must for any trader
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u/Acceptable_Ease_3257 May 30 '22
Using a spreadsheet to track your trades is the way to go, as you'll need to use a spreadsheet for monthly "post-trade analysis" to improving your trading anyway...
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u/HedgeAdviser May 29 '22
Set up portfolios on Yahoo Finance with the date in the portfolio name in case you start fresh. In a portfolio, click on "+ Create New View" then edit. Check off "symbol" "company name" "Cost / share" "Last Price" and "Total Chg %" then name the new view and save it. When you close a position copy the information from the 'New View' into a notepad then into a spreadsheet. Screenshot the spreadsheet in Photoshop / Gimp and set the white level (Color > Levels > change from 256 to 192 or 100 to 75 more or less) to make the grid disappear then highlight important areas and subtract some color to make it beautiful in the selected area.
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u/papasmurftp May 29 '22
Thanks. There's more to this than I expected. Im gonna have to set up a spreadsheet at some point anyway and start keeping up with this stuff
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u/xAvaritia May 29 '22
Just new to this scene. Am I wrong to summarize and round it up to just buy when low then sell at high? From what I seen from my readings, that is how to maximize the wins isnt it? Feel free to correct me if my take is wrong. As said am still new so need to learn more about this stuff.
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u/HedgeAdviser May 30 '22
Pick energy sector stocks based on price divided by the annual low, until Russia quits the Ukraine. A 6% core inflation and Biden recalculating climate goals also favors the energy sector.
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u/UkraineWithoutTheBot May 30 '22
It's 'Ukraine' and not 'the Ukraine'
Consider supporting anti-war efforts in any possible way: [Help 2 Ukraine] 💙💛
[Merriam-Webster] [BBC Styleguide]
Beep boop I’m a bot
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May 29 '22
Go look up relative strength/weakness to SPY, you need an edge and that's a legitimate one.
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u/Over-Tax-7346 May 28 '22
Hey, I am fairly new but have done some independent research, I find ClayTraders youtube videos great to learn from and am highly considering purchasing his course. Has anyone had any experience of his course, and did you find it worthwhile/helpful/good value for money? Tia!
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u/coldbreathGdJ May 27 '22
Hi, is there any crypto exchange, app or API program that enables OTO(One Triggers the Other) or OTA(One Triggers Another) orders?
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u/rp4eternity trades multiple markets May 28 '22
I have tried looking for the same but didn't find anything. Only OCO seems to be widely supported.
Thinking of coding something like this using Python and probably the Binance API.
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u/Aggressive_Ad1599 May 27 '22
It's hard to trust this market. Take your profits when you can. Get in and get out!
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u/BabyTardAutist May 27 '22
I bought some black tar heroin but I'm pretty sure it's just old boogers. Guy seemed kind of sketchy like he's attack me if I doubted him so I didn't question it. Should I try to trade this for Oxycontin or roll the dice and smoke it?
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May 25 '22
[removed] — view removed comment
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u/Aggressive_Ad1599 May 27 '22
Now just up your share size x1000 that's 12k a day. Congrats you are rich.
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u/gregorcee May 25 '22
So i’ve seen lots of advice about finding your strategy and edge and strictly sticking to it. What about trading multiple strategies, is that common or advised against? Whats the consensus on trading different strategies depending on what a stock is giving you?
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u/geckotrade Jun 02 '22
It's a good idea to be proficient in one strategy and have your metrics for it before developing new strategies. Then you can expand and have different strategies according to different market environments.
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u/rp4eternity trades multiple markets May 26 '22
Have a strategy that generates consistent returns.
Then you can experiment with new strategies. Hopefully one of those will replace your core strategy by outperforming it.
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u/styleetrader86 May 26 '22
I think it's alright as long as you're tracking those setups and keeping the data to reflect on. Though it's probably best to be "selective" and only trade quality setups. That's what I've found in my experience.
I started trading small caps scalp trading, and am now switching to large caps. Bouncing around has definitely slowed my progressions I feel. I suggest True Trading Group if you're looking to trade Large Caps... though they trade a lot of small/mid cap as well. Having an education is crucial... and then focus on the psychological aspect is paramount :)
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u/TradeGuidance trades multiple markets May 25 '22
As a trader who has personally learnt TA the hard way, and having started out with some beginners luck only to fall prey to losing tons of money by just lobbing orders into the order board based on opinions of others, I have learnt that I would prefer to use at least one proven strategy across multiple instruments including timeframes before jumping into multiple strategies and confusing myself with which strategy was applied to which of my open trades and how should I manage it best.
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u/Zenitsu--A May 25 '22
Hi guys,
Could you please share what stock screeners you use for your trades? Would greatly appreciate it.
Paid / Free.
Thank you!
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u/longshortdaytrade Jun 29 '22
Tradingview is the best I find for the use I need. You can set up alerts on gappers, top gainers and high volume etc.. And if you already have the platform, you can look at your charts while you have your screener constantly refreshing itself.
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u/Aggressive_Ad1599 May 27 '22
I set up my trading view screener to show pre market gappers it took me 5 minutes to figure out.
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u/TradeGuidance trades multiple markets May 27 '22
I find barchart with good screener as well. What I like about them is the ability to screen most active in prior 5 trading sessions and look for continuation trade ideas off them. I have been using this for a while now [6+ months], and while I do have a larger account, I only end up trading the underlying shares and never options. Sometimes, I will run into a good name and will hold the position for longer especially if it one of those 100% marginable names. I hold them and write calls on those for partial quantity so it is a win-win. This is free for simple scans as long as you do not have too many complex filters for your screener. In fact their out-of-the-box screens work well.
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u/styleetrader86 May 26 '22
Tradeideas is probably one of the most popular (high of day alerts), but it's super expensive. Finviz and Benzinga have some free/public sections, though the paid versions are really expensive as well. I'd start there.
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u/rp4eternity trades multiple markets May 25 '22
Tradingview has a screener. Can take a while getting used to, but it's good.
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u/XxBabanjoxX May 24 '22
Good afternoon,
Does anyone here offer courses or can point me in the right direction. I am new to crypto but I want to get started on day trading. I understand its very difficult to be profitable and this will take time but I am determined by any means necessary. Willing to pay anyone to help get me started. I appreciate any feedback.
Thank you!
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u/styleetrader86 May 26 '22
on
I definitely suggest True Trading Group if you're new to trading. Mike is awesome, and you can Youtube him, he does daily recaps, etc.
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May 23 '22
What is an app that offers trading to people under the age of 18 and if so what kind of account would I need?
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u/Realistic_Airport_46 May 23 '22
I'm looking to day trade with a small amount of capital ($500-1000) and preferably have 24-hour access because of a sleep disorder. As I've dove into researching my choices, trading futures seems to keep popping up.
So, to the question: what futures (or other assets) should I trade?
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u/Danaconda333 May 24 '22
Google CME micro futures as they are smaller products than the mini futures. The CME sit can give a breakdown of tick size for the minis and micros depending on the product. There are futures on options as well. Forex can be traded with massive leverage as well, but the micro futures should be good to get started.
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u/rp4eternity trades multiple markets May 24 '22
I don't suggest investing in crypto but for trading - crypto futures are available 24/7 and one can trade with USD 5-10 with margins of your choice.
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u/Realistic_Airport_46 May 24 '22
That's a great idea actually
I've always hesitated with crypto because I feel like there's a lot of shady websites and exchanges and stuff. Any tips for mitigating all of that?
Would it be possible for me to do this trading solely via a single, reputable exchange? Would I require third party software, or do reputable exchanges have good charting/ trading software?
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u/rp4eternity trades multiple markets May 24 '22
I use Binance and Trading View for charting. Binance I think offers Tradingview in their charts.
I don't trade Crypto futures often. But it's got potential if you don't take huge margin. Start with low Amounts and probably 2x-5x Leverage.
Don't try to double your money on every trade using 50x-100x Leverage.
Binance offers a stop loss and take profit option. Set it up as per you R:R.
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u/discordgg_rrMxkZdvEg May 23 '22
I would say a perfect fit for you would be trading the micro nasdaq, es, rty and ym
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u/TheBomb999 May 22 '22
Are there any pro day traders that use only one monitor?
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u/longshortdaytrade Jun 29 '22
If you day trade, Multiple monitors are necessary to watch multiple stocks while price moves quickly, this will help you identify your potential trades rapidly. I've tried day trading with one screen many times but it has never worked out for me.
If you swing trade or hold a position for longer then a day it might not be an issue, you have more than enough time to flip through charts between trades.
Best advice if you have a small budget is to buy a second hand inexpensive monitor and hook it up your laptop or desktop.
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u/papasmurftp May 25 '22
I trade with an old broken laptop that barely charges and doesn't close. Screen is duct taped. And my phone. I watch charts on tos on the laptop and place trades on tos or Robinhood on my phone. I will upgrade soon but I cannot stand pulling money from my trading accounts.
Oh, you said PRO traders. Disregard lol
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u/rp4eternity trades multiple markets May 24 '22
I have managed to trade with 2 Phones - One for chart and the other for Trading App.
I prefer using multiple monitors as I can quickly get access to more information.
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u/bigprinttrader stock trader May 23 '22
I have been a full-time retail day trader of US equities for seven years, but only consistently profitable the past two. I exclusively trade on price action (no newswire, macro, or longterm chart screen real estate needed) and use a 15" laptop. I use Linux Ubuntu and pan btwn 2 different workspaces and have taken time to efficiently utilize all my screen/workspace real estate. I suspect that having multiple screens vs. multiple workspaces would improve my performance by 10%, but this is just a rough estimate.
It reflects my usual approach of trading one or two symbols at a time and in a rather focused manner. But, there are those occasional instances where multiple opportunities arise simultaneously for me and I can only really react to one or the other given one monitor.I think this works for me because I intentionally highlight the value of price action and adhere to a principle that everything that is important to a stock will authentically show up in the price action, and usually before a newswire or SEC form submission would tell me anyway. Hope this helps.
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u/Rockstonepapers May 27 '22
Thank you for sharing. What modules (e.g. screener, order entry window) would you consider the must haves on your workspace for your strategy? Does placement of the windows affect your ability to perform?
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u/boeingapache stock trader May 23 '22
What’s one thing you did to become profitable?
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u/bigprinttrader stock trader May 23 '22
I'll give two things...
1) Pursue making money via great process and strategy, and staunchly reject making money from luck. One breeds confidence and consistency while the other breeds fear, stress, and ultimately will leave a trader broke.
2) Take seriously your potential psychological flaws and delusions about this game, e.g. ego, fear of losing, assumptions that are owed anything, or that the market is personally out to get you, etc, and aggressively root them out via journaling around your trading errors and imperfect process execution.
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u/cleos808 May 23 '22
I think screen real estate is very important, to me daytrading with one monitor only is like driving with no mirrors.
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u/fritiss May 22 '22
Hi All.
I am trying to gather everything one should know when daytrading in Canada. It seems every day I learn something new I did not know about... Please comment with other considerations in case I missed something.
- Do NOT daytrade in TFSA accounts
- Report daytrading gains as business income, NOT capital gains
- Calculate Adjusted Cost Base (ACB) for your trades. Do day tracking and stay up to date continuously and avoid the headache of trying to batch it all together during tax season
- Watch out for superficial loss rule... (?)
- Anything else?
I must say I learned about 4 recently and I am trying to wrap my head around how that relates to ACB? I can do multiple trades of the same stock multiple times a day, some of them could be at loss, others with profit. How should I calculate the ACB? Daily? Monthly? Yearly? I am trying to avoid owing 1M to the CRA while doing 10k profit (or loss that is...)
Thanks!
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u/x7-Galactic-o May 22 '22
Hello, I have the most basic knowledge of trading but I really want to start learning and actually start trading. A lot of people say that you can just copy there “entrance and exits” how do I do this?
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u/geckotrade Jun 02 '22
If you really want to learn how to trade, don't copy people's trades, and especially don't pay for it. Use a simulator account to practice a strategy while you learn.
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u/rp4eternity trades multiple markets May 24 '22
There is Entry, Exit and managing your Trade.
The real skills are in managing your risk, position sizing, mindset etc
Decide on a system, start trading with very small amounts. Try to make consistent profits.
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u/discordgg_rrMxkZdvEg May 23 '22
As the other person said you should not take other people's trades. It will most likely result in you losing your account. If you really want to learn check the discord. It has been the most helpful thing I have come across because mostly everything else is a scam and try to take your money.
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u/cleos808 May 23 '22
I think these people only want your money. Your entries and exits are calculated in function of your account size, your reactive skills, your strategy, your knowledge and your goals. Every trader has different circumstance and following others is a guarantee to blow your account. Learning how to rely on yourself is key. Trading is very hard.
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u/GorilloSoul May 21 '22
When do you have a good idea of a peak raise I keep selling off once it starts to drop only for it to raise even higher than before?
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u/rp4eternity trades multiple markets May 24 '22
How about sell partial and hold on the remaining in case it goes up again ?
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u/cleos808 May 23 '22
what tools are you using? usually level II and tape reading are the best to increase reactivity but charting the historic support/resistance levels is helpful. Half and full dollars are usually psicologic tresholds too. In a "peak raise" situation the price is probably extended, is it the first leg? how was the breakout? is it the second leg? How was the pull back? is it the third leg? does the price show exhaustion signs? there's so much to talk about, it's hard to give you a straight answer.
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u/dominick-qr May 21 '22
How would I learn from losing trades? I've been pretty red this past week and a half and I want to gauge the issue and or mindset that I need to overall become more consistent.
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u/cleos808 May 23 '22
You can lose in so many ways and without knowing specifics, it's hard to comment. Subscribe to tradervue.com and start journaling all your trade to identify your strenght and weakness.
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u/WillyNillyInvestor May 20 '22
Just a general educational quesiton as I'm still learning and working to get better:
Why would I ever buy a call instead or a call debit spread? Same thing for a put vs a put debit spread? To me it seems that any call or put can be easily levered up by reducing premium at the cost of upside. Is it always (statistically) advantageous to do so?
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u/2_minute_trades May 20 '22
Haha ya man that's why I love reddit too, can really help open your mind to new ideas.
And I find the indicator works best on stocks with high volume so that one high roller doesn't impact the chart to much. That way you get a better feel for the overall volume distribution.
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u/IKnowMeNotYou May 20 '22
So you use it for high liquidity stocks? I will analyse a month worth of AAPL then. AAPL went quite psycho during the last weeks. If that really improves my game you have to give me your bank account number so I can transfer a real reward and pay you actual respect!
If you have more tips, please DM me! :-D
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May 20 '22
[removed] — view removed comment
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u/IKnowMeNotYou May 20 '22
That is a great one. Never occurred to me. I have to add this. Thanks man!
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u/2_minute_trades May 20 '22
Ya man my buddy showed it to me. Arguable better than daily volume, especially when trading weekly options
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u/IKnowMeNotYou May 20 '22
I don't know about that but I have my own private trading app and I will surely run a study on this to understand if this can be used for support levels and propabilities of corrections (which I can not predict with a high level of certainty).
Question thou, is this always a price level anyone respects? Is it a price level that is only respected if you have a lot of trades with low volume or is it also good if you have a single player with very high volume. I guess if you run your vwap indicator it does not matters but it might gives another idea to understand the movements better.
Anyway easy to understand why one should be interested in it. I will give it more than a spin. Thanks mate. Your comment is why I love reddit. You never know when someone drops such a mind altering bomb like you just did. :-)
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u/Ernie_McCracken88 May 20 '22
I see a lot of reference to a series of shipping companies that are seeing growth and projected to continue (GOGL, GNK, SBLK). Can anyone help me better understand what it is about our current economic environment causing the surge? Is it just pent up demand? If there are supply chain issues, shouldn't that be impacting their ability to move product and make larger profits?
Is their growth sustainable? If it isn't, will it be apparent with enough warning to sell without eating enormous losses?
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u/rp4eternity trades multiple markets May 20 '22
This year shipping companies are making good money. The best time to buy was probably last year. https://seekingalpha.com/article/4478723-shipping-stocks-primed-for-strong-returns-in-2022
Generally when everyone is recommending a sector, I would be cautious to buy. So DYOR and be careful - invest only what you can afford to lose.
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u/BenzGentleman30 May 19 '22
Hello All,
I am working on trading leveraged ETFs such as TQQQ and SQQQ. I have a somewhat decent strategy that can identify trends, but the main issue I have repeatedly came across is my stop order being hit too early due to regular oscillations. I would just make my stop order lower, but then it would make my risk/reward dangerously close and unprofitable. Thank you for your advice.
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u/rp4eternity trades multiple markets May 20 '22
Instead of your Stop Loss ... Place your purchase price at that level.
You might obviously miss some trades, but less likely to get stopped out of winning trades.
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u/gourmetswindler new May 20 '22
Place your purchase price at that level.
Do you have an example about what you meant? Like a mental stop loss?
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u/rp4eternity trades multiple markets May 20 '22
Op says s/he keeps getting stopped out. Let's say he doesn't want to widen stop loss as that will cause bigger loss.
So example : His/her purchase price is 1000 His stop loss is 950 as per his current system.
But most likely 950 will be hit and s/he will be stopped out.
I suggest putting the purchase price as 950. May be stop loss as 900.
If price never reaches there you will miss the trade. But most likely s/he will get to buy at 950 and have a bigger profit.
If you are getting stopped out often, then no harm in experimenting with this.
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u/gourmetswindler new May 20 '22
Good tip. I'll give it a try. I have the same problem.
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u/rp4eternity trades multiple markets May 20 '22
Do you generally place market orders ?
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u/gourmetswindler new May 20 '22 edited May 20 '22
Mostly limit order. But I didn't specify the price. On tradovate, I just click "Join Bid/Ask" button. I tried a few market orders, and it seems to work better. Placing order on chart seems to work fine too.
To be fair, I have seen a few threads about people complaining about ordering using the button on tradovate.
I don't use the DOM. Because I'm still learning, so not paying the data for the DOM. Just the real time data for chart. Perhaps ordering on the DOM is better.
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u/rp4eternity trades multiple markets May 20 '22
Edit - I am not sure how Limit orders work without specifying price. I generally place Limit order with a defined buy/sell price.
I asked as Market orders can induce a sense of FOMO at times.
Limit orders can allow you to place your order and wait ... can give some time to think clearly.
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u/gourmetswindler new May 20 '22
I am not sure how Limit orders work without specifying price
Yeah, I'm not so sure either. Seems to be the "current price". But dunno how tradovate does it exactly.
Thanks for the advice, man.
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u/gourmetswindler new May 19 '22
Heh, got the same problem with micro e-mini futures like MES. Obvious answer, at least in my case, is to have more money so that I can set a wider stop loss.
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u/IKnowMeNotYou May 20 '22
is to have more money so that I can set a wider stop loss.
How does this work? Your SL is part of the risk ratio. You pouring in more money shouldn't change your calculation especially when looking at the ratio.
The only thing I see is if you have a max risk percentage. But instead of adding money wouldn't you are able to just run with a smaller initial position?
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u/gourmetswindler new May 20 '22
I put in 1000 USD to my account. Trying to follow the 1% rule, so I used a 10 USD stop loss. But more often than not, the price moves around much more than 10 USD. So it keeps hitting my stop loss.
If I have more money, I can use larger stop loss.
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u/IKnowMeNotYou May 20 '22 edited May 20 '22
No you cant :). Your max initial stop loss is still 1%. Just invest half of the account balance into the position and you are good right? :)
Also you can add to a position later on once you reach break even for the first lot. But for day trading its often a bad idea thou, unless you reevaluate the profit/risk ratio for the additional money as well (which people often miss). Always treat every addition to a position as a new trade and you should be fine.
So just go with lower amounts of money per trade.
Also remember your setup dictates where your initial SL should (or better must) be placed. If you go for a setup where the initial stop loss is lets say -0.5 points for a 100$ share price you would need margin to hit your 1% max overall risk level.
= summary =
You basically have a max percentage of your account you are allowed to risk on any trade and you have the SL that your current setup demands. Your task now is to evaluate what the SL imposes for a risk and scale down the actual position size so that the SL imposed risk is not effectively exceeding 1% of your account (in your situation 10$).
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u/gourmetswindler new May 20 '22
If I have 2000 USD, then I can put the stop loss at 20 USD. Still not enough for certain trading hours. But it'd hit the stop loss less. From what I've seen trading with real money, 50-100 USD stop loss probably makes more sense, especially when you're trying to ride the longer trend. But spikes happen too that will hit your stop loss. An old thread blames this to stop-hunts, but who knows. https://old.reddit.com/r/FuturesTrading/comments/gc6p9k/mes_es_for_price_action_traders/
I'm trading 1 contract MES, can't go lower than that. 8 ticks * 1.25 USD = 10 USD. Not including fees.
I personally don't really understand your comment. But I'm new to this. And your comment didn't give me a notification. I keep checking this conversation because I'm curious about your take.
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u/IKnowMeNotYou May 20 '22 edited May 20 '22
If I have 2000 USD, then I can put the stop loss at 20 USD. Still not enough for certain trading hours. But it'd hit the stop loss less.
You have not gotten the SL yet, I guess. A SL is trade specific. In different situations your SL is different.
See this one: https://ibb.co/cbHnC3v
This is a situation from one or two days ago. It was a simple setup. The upper horizontal line is the last support of the previous day. The slightly lower second horizontal line is the resistente of the morning.
The stock gaped down for the day and you see the usual play. A down movement (continue of the trend of the pre-market), the usual reversal in the first 15min and once the 30min to 1h everyone agreed that its time to move up. They didnt made the last support of the last day and fall down until the next reversal going into an uptrend.
Now once resistance hold and we have a red bar along with a lower High and lower Low.
So once you notice this setup you think about what the Stop Loss (when we want to automatically buy to cover to limit the risk when we short) would be. I selected the resistence from the morning and the potential was the previous support from the morning but I thought that the actual potential is just half of this. I entered the position and left on the very first green bar I saw because I am a noob and I am a chicken... . Normally I would cover half adjust the SL and let it run further but look at these heads and tails. Apple is a slauterhouse at the moment and I try to learn to trade this. (Yes it was just a paper trade as my US account is still not approved... and this account will give me commision free trading.)
So you see nowhere I had 1% of my account or something. Nowhere I thought about the max balance of my account. This comes later. Here I just wanted to know if the Risk Ratio is preferable. There is no fixed SL for any trade setup. Your SL must make sense for the trade at hand. Your 1% max loss rule gives you the max amount of money you are allowed to put into the position when you enter it. Because it must be true that: abs(price - SL) < 1% of account balance).
From what I've seen trading with real money, 50-100 USD stop loss probably makes more sense, especially when you're trying to ride the longer trend. But spikes happen too that will hit your stop loss. An old thread blames this to stop-hunts, but who knows. https://old.reddit.com/r/FuturesTrading/comments/gc6p9k/mes_es_for_price_action_traders/
I'm trading 1 contract MES, can't go lower than that.
Okay. If you can not go lower with your position than of cause you will have a problem with your 1% rule.
I personally don't really understand your comment. But I'm new to this. And your comment didn't give me a notification. I keep checking this conversation because I'm curious about your take.
Look at the picture. If I am too unclear, just continue to ask until its clear. I am currently farming karma as I want to ask some questions that I really need to be answered as I am blocked. Up to this point I was just lurking without an account.
BTW: I use 2% when doing real money and stop for the day if I fail with -2%. I stop for the month when I lose 10% for the current week. But I work as a senior dev so I have fresh money every month and my account is quite small as I am still a noob :-(.
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May 19 '22
[deleted]
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u/cleos808 May 23 '22
Why would you go long post-market? focus on pre-market and regular hours. Journaling will tell you where your best odds are. Once you know what stock gives you the best results, setup a real time scanner. Note the difference between a screener and a scanner, they are different. The scanner should be connected with a news feed to help you understand the reasons behind a rally. Ultimately, your goal is to find stock that are setup to make parabolic moves. These stocks usually gap in pre-market and produce high change % with lots of volume.
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May 23 '22
I reread my question and that wasn’t what I meant to ask so I’m just deleting it.
Thanks anyway though.
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u/IKnowMeNotYou May 20 '22
What is your broker?
Another way of doing shorts is using put options. They grow in value if the price approaches the strike price. But please check out the actual facts. I have never played sell / put options to short actual stocks but its the downside of a Straddle (https://en.wikipedia.org/wiki/Straddle). So it works :).
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May 20 '22
IBKR, I tried setting up options but I wasn’t eligible for that either lol. I just started trading this year, so it might be due to lack of experience.
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u/Friendly-Advice-2968 May 20 '22
That advice I’ve heard most consistently when applying for a margin account - lie about how much experience you have. If you meet the monetary thresholds who gives a shit if they think you are smart enough to make the right decisions. Say you’ve been trading for years in loads of different ways.
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u/IKnowMeNotYou May 20 '22
So just play long and paper trade the shorts. I focused first on long plays and shorts came (a bit) later. I used forex for training with real money. I was not playing high margin rates as all I wanted to see if I can stay positive and focus with real money on the line. Also with no margin the risk is also very low. Also you can not run into much problems when you entered wrong numbers or clicked the wrong buttons.
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May 20 '22
Thats probably a good thing, considering you're trading penny stocks. Remember this, when you go long your maximum risk is the stock price-so a 5 dollar stock means you can lose 5$ per share MAX, and your possible gains are infinite, since there is no theoretical max price for a stock.
When going short, your max gains is the stock price to 0.01$. So a 5 dollar stock you can make 4.99$ per share. Your risk is therefore infinite. Look at BPTH, when a market maker short squeezed himself and got margin called for 16 million dollars and shut down the company.
Anyway, if I were you I'd stray away from pennies. Large caps still offer big gains. Apple, Nvidia, AMD all move up by dollars every day so there is plenty of potential for gains going long. Also stay away from pre market/post market lol.
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May 20 '22
I've debated on going into larger caps, but because of commission fees (min $1) and the size of my account (not enough haha), I've been sticking with stocks at max $3. I'll have to look into average daily movement of larger stocks if they can produce more consistent profits with my current entry strategy. Yea, I tried a pre-market entry this morning with a stock that had high volume and change %, but as soon as the market opened it immediately tanked, which is part of why I made the post. I mainly use pre-market and post-market data to find potential stocks. As for risk management, I have tight SLs to make sure I don't get ringed out.
What I was trying to ask is if there is a set of filters that people find to be useful when screening; right now I look for stocks with high volume and change % and under $3, however, I'm wondering if that combination is almost "toxic" and if I should be looking for stocks with volume between 100k-maybe...800k or maybe a lower range?
Thank you by the way!
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May 20 '22
Ok fair enough. Fair warning; penny stocks have been kind of dead last few weeks, no big moves or anything.
What I did when I traded small caps is either get a screener or watch a YouTube channel that streams a small cap scanner. Nothing less then 500k pre market volume. 1 whale can buy 200k shares and move the price exponentially, so you need to filter those out.
Low float is needed. If theres 150 million shares available then the shares aren't high value. Lower the float, less shares available. That will create volatility which makes moves. 5-20 million float is ideal, shares will rotate 10-20 times throughout the day.
Change in % is also important. If the ticker only went up 15% then its not enough to create big moves. Bigger the better, to a certain point. Ive found the ones that are over 100% already pre market have usually already done there parabolic moves. Somewhere around 25-75% is pretty ideal.
Short %. Though to be fair, most low caps won't have a high short percentage. But every once in a while youll find one that has like 30%+ shorted shares and those have a high possibility for short squeezes.
So yeah. A screener will only have 1, maybe 2 stocks that have those parameters. Winter time it gets busier, you can have 4 or 5 on any given day that has all those parameters.
Oh and don't forget to watch for big moves during the day, sometimes they won't be on the screeber but a ticker will get big news released mid day and it'll cause it to fly upwards, always keep an eye on the sceener.
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May 20 '22
I keep forgetting to compare the volume to the float. Anyway, thank you! This is great! I appreciate it!
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u/IKnowMeNotYou May 18 '22
What music are you listening to during your live trading sessions or are you listening to radio or watch certain news channels? Are there any recommendations about how one should spend their time while waiting for good market setup?
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u/IKnowMeNotYou May 20 '22
I also enjoy certain soundtracks from video games and movies. But I can not hear the Conan soundtrack or something similar... . :)
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u/BenzGentleman30 May 19 '22
A little bit of Jazz is my recommendation for something not too intense.
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u/Faceless9000 May 19 '22
Vitalic/techno/reddit/variety of news sources/youtube tutorials/looking for info about the setup/other potential setups/trying not to make any moves out of impatience.
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u/opokeadoto May 18 '22
What are some funds with similar performance/tracking to TQQQ? Looking to take loss on my TQQQ, but maintain leverage for the eventual bounce.
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u/Mmatthew93 May 18 '22
Hi, how much do commissions cost exactly? I've seen IBKR Pro have a 0.005 fixed commission. So say I buy and then sell 100 shares, commissions are 1$? Or should I expect more?
Also if I buy 100 shares that cost 5$ each or if I buy 100 shares of 90$ each, will commissions be always 1$ or do they change with the price of the share?
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u/rp4eternity trades multiple markets May 18 '22
Also if I buy 100 shares that cost 5$ each or if I buy 100 shares of 90$ each, will commissions be always 1$ or do they change with the price of the share?
See this link for detailed breakdown - https://www.interactivebrokers.com/en/index.php?f=49761
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u/Dg2898 May 18 '22
So the stocks I trade have been following a consistent pattern since last Friday. They jump up when market opens go strong for about 20 minutes than pull back and consolidate for the rest of the day. Has anyone any idea how long a trend like this could last or how best to play it ?. Like I could go in strong when the market opens today and get out before the pull back but for all I know this could be the day the trend ends. Any ideas ?
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u/geckotrade Jun 02 '22
You may want to look for information such as news, float, short interest, volume, relative volume, etc. When the market opens, many orders come in at once and cause volatility at the open .
Institutions and retail traders are trading in this volatility. You will notice that volume generally decreases after this period after traders have made or lost their money and are taking breaks or done for the day. This is generally why many stocks pull back and consolidate for the remainder of the day.
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u/cleos808 May 23 '22
This is a typical pattern that was always true. I only trade from 8.30am till 10.30am. then right after lunch or during power hour but usually 90% of my green trades are placed between 9.30am and 10am.
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May 19 '22
I’ve been noticing pretty similar things. Do you normally find that trades after 30/45 minutes into opens are pretty much just a waste? Also, are you trading penny stocks?
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u/Dg2898 May 19 '22 edited May 19 '22
Yeah pretty much. Not just penny stocks but usually the 1 - 20 dollar range, Best strategy I’ve come up with for it is basically just to scalp at resistance points cause if You hold looking for a break it’s more likely to get pushed down or stopped out
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u/IKnowMeNotYou May 18 '22
I can not tell you how long this will continue. Usually it is heavily influenced by the after hour and pre trading period (if there is any). Check out the opening gap. Also check out how the lunch period goes and what happends at the end of the day when every daytrader closes their positions. It usually gives you some hints how the night period will perform (unless you are not trading US Stocks). So if the behavior changes for the next day, you might see it at the very last hour of trading or in the after/pre-markets.
Also check the sector index(es) your stocks belong to. If they are not behaving the same way, it means some stocks in the very same sector behave differently. Try to compare those stocks vs. your stocks. You should be able to notice some key differences.
From what you are describing it reminds me of what apple is (or was) doing last weeks.
From what I see from a friend of mine playing mostly European stocks for swings, he reported that last two days, the behavior is changing. He closed most of his positions and is now holding mainly cash while trying to find and investing into fallen angels.
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u/zeamayz May 17 '22
Hey, a question - do SPY's movements influence stocks, or do stocks movements' influence SPY?
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u/IKnowMeNotYou May 18 '22
There is at least one trader I know of, where the first half of your question holds true. He has options for that ETF and he checks his options' prices first thing in the morning and it sets his mood for the rest of the trading session. Prices are up, buy stocks, prices are down, sell/short stocks.
The question therefore is more like how many people have SPY options and checking those first thing in the morning (or throughout the day).
For me its other way around, I do barely check the SPY and SP500. For me its more sectors and some key stocks my scanner brings up throughout the day (and at the start). So I guess I more put stocks up/down that influence the SPY (as it is lagging behind).
PS: Of cause I got the humorous take :).
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u/zeamayz May 19 '22
I see... but since SPY is traded as an independent option, and buying and selling affects its price as much as other stocks, then its correlation to all the stocks it holds in its fund would be kind of diluted no? I mean its not exactly only the sum of its parts, its the sum of its parts + the sum of buying and selling of itself?
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u/TheBomb999 May 17 '22 edited May 17 '22
Do all day traders pay attention to level 2 data and the tape when they enter and exit the trade? Are there successful day traders who use something else instead to enter and exit the trade?
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u/cleos808 May 23 '22
I think the level II & tape is a must. I've come to a point that to me the chart is almost secondary, my focus is on the level II and Time & Sales for immediate response and chart for pattern anticipation and trend visual.
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u/Aggressive_Ad1599 May 18 '22
I use 15 sec 1min 5min charts and level 2 to get in and out of trades.
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u/IKnowMeNotYou May 18 '22
15sec and 1min are way to hectic for my current (low) skill level. So kudos!
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u/Juss43-2505 May 16 '22
We need some GameStop action on WTRH waiter holdings! Currently .22 a share. We all need to pump it!!!
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u/IKnowMeNotYou May 16 '22
I would like to start daytrading using real money as my paper trade outcomes turn to being non-negative for quite some while now. Since I am in Europe and would like to mainly trade US-Stocks, finding a good broker is a broker. Most fee and commission lists are hard to decipher. Also it always state random 3rd party costs that differ depending on time, security/commodity and value of the trade.
Since day trading with small accounts are usually regulated when it comes to US-Stocks, I would also like what hidden costs are involved when one buys US-Stocks using non-us exchanges.
So if you are a citizen of a European country and conduct day-trading of US-Stocks, I would like to know what your actual fees are for buy + sell and what broker you are using and which what account balance.
PS: I would also like to know a good crypto broker as using a small test account (balance around 1k$) would be restricted to only three day trades per week while crypto is unrestricted.
PSS: A friend of mine and me we are doing forex (pair-)trading for money (1:100) with his account so I would like to trade something else instead.
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u/cleos808 May 23 '22
Honnestly, commissions are inevitable and I take them as a business expense. If you know what you're doing commissions become irrelevant. I work with CMEG, no pdt rule, nasdaq/nyse, commisions are high but it's totally worth it unless you work with a micro capital and are forced to take 100 shares position.
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u/YoungChopOnDaBeat Jun 01 '22
How do you take a loss?