My Strategy - Opinions Required

[TouchingSkies]

Hi Folks,

I work full time and made a lot and lost a lot, which has finally led me to develop a strategy. Below is one I am developing, it is fluid and open to suggestions. It has taken "inspiration" from more than one source and I would like your feedback :

1. The step by step small to mid-cap analysis:
a>Spread under 10%?
b>What is the companys plan to make money?
c>What is the the game changing catalyst(s)?
d>Is the cash-flow a likely issue for the price?
e>How many shares in circulation and their make-up?
f>Quality of management?
g>Its relative strength to the overall market?
h>Glance at upcoming macro economic events?

2. Money Management - (100% investment capital divided into 80% for 8 stocks (8x10%) updated daily to reflect actual portfolio)

3. Always Use a Trailing Stop Loss - with support/resistance, once moving using swing low and high points taking into account bid-ask volatility spread, to lock your profits and stop your losses, with initial trailing stop under a support base,a swing point low and lowest bid. [or could I use ATR of 5 instead?]

4. To Buy - (1)Buy on first pullback from breakout from a base (bigger the base the better) OR (2) Buy when in consolidation base near support OR (3) Buy on breakout from base(remember bigger the base the better ) - It all depends on upon how well you know the stock and sometimes the GAP up or down reaction.
Buy always before closing bell (unless it looks very convincing -i.e. fantastic RNS/rapidly increasing bid) if it is finishing higher than open for (1|2|3) in half's (again unless it looks very convincing)- tranches of 50% and 50% on the declining/rising swing low|high pullbacks) - taking into account bid-ask volatility spread[or could I buy in thirds instead?]

5. Initial Profit Target - This can be done by checking previous resistance or for new highs, by measuring the distance between support and resistance of the consolidation base, though remember to allow profits to run and look for stocks that can at least double your money.

6. Keep TA Simple - support/resistance/trends and patterns taking into account bid-ask volatility spread price and nothing else [indicators merely confirm afterwards -thus useless]

7. No Holy Grail and Patience - Accept there is no holy grail strategy, only discipline and patience is vital for entry and exit

Any opinions?

 

[TouchingSkies]

51 views and no opinion.... "Ma da dod nei peetta?"

 

[seetharamank]

i think bid ask volatility alone is not enough

 

[crown]

Hi Folks,

I work full time and made a lot and lost a lot, which has finally led me to develop a strategy. Below is one I am developing, it is fluid and open to suggestions. It has taken "inspiration" from more than one source and I would like your feedback :

1. The step by step small to mid-cap analysis:
a>Spread under 10%?
b>What is the companys plan to make money?
c>What is the the game changing catalyst(s)?
d>Is the cash-flow a likely issue for the price?
e>How many shares in circulation and their make-up?
f>Quality of management?
g>Its relative strength to the overall market?
h>Glance at upcoming macro economic events?

2. Money Management - (100% investment capital divided into 80% for 8 stocks (8x10%) updated daily to reflect actual portfolio)

3. Always Use a Trailing Stop Loss - with support/resistance, once moving using swing low and high points taking into account bid-ask volatility spread, to lock your profits and stop your losses, with initial trailing stop under a support base,a swing point low and lowest bid. [or could I use ATR of 5 instead?]

4. To Buy - (1)Buy on first pullback from breakout from a base (bigger the base the better) OR (2) Buy when in consolidation base near support OR (3) Buy on breakout from base(remember bigger the base the better ) - It all depends on upon how well you know the stock and sometimes the GAP up or down reaction.
Buy always before closing bell (unless it looks very convincing -i.e. fantastic RNS/rapidly increasing bid) if it is finishing higher than open for (1|2|3) in half's (again unless it looks very convincing)- tranches of 50% and 50% on the declining/rising swing low|high pullbacks) - taking into account bid-ask volatility spread[or could I buy in thirds instead?]

5. Initial Profit Target - This can be done by checking previous resistance or for new highs, by measuring the distance between support and resistance of the consolidation base, though remember to allow profits to run and look for stocks that can at least double your money.

6. Keep TA Simple - support/resistance/trends and patterns taking into account bid-ask volatility spread price and nothing else [indicators merely confirm afterwards -thus useless]

7. No Holy Grail and Patience - Accept there is no holy grail strategy, only discipline and patience is vital for entry and exit

Any opinions?

namaste bhai
I am just an amateur in technical analysis, therefore don't know whether it will be appropriate on my side to place any kind of comment.
So, whatever I am putting in is just my experience, which may or may not be correct.

First of all, I strictly avoid mixing technicals with fundamentals; because I find there is lot of difference in taking positions on these two basis.

Second, the best way of trading is to buy at support and sell at resistance; and therefore, the concept of entering long or short merely on the basis of breakouts has only 50% chance or may be less.

Third, there are some indicators which give advance signals. I use CCI as advance signal generator. You can choose as per your comfort.

Fourth, If you are simply able to find appropriate support and resistance levels, you can be ahead of most of the traders. Then, there remains a very less need of looking at other technicals and/or fundamentals. Therefore, I am just trying to have as much efficiency as I can, just to find accurate and dependable support and resistance levels.

Namaste bhai

 

[crown]

one more thing bhai from my little experience

Avoid using volume as an independent indicator for your trades; because in my experience using volume as main indicator will often confuse you and you may miss the good trade or may enter in the wrong trade quite often.

 

[linkon7]

I am a day trader. But If someday i decide to build a portfolio, then my time frame becomes my number one concern. i.e. How long i plan to hold on to the average stock in my list. If my average holding period is just 1-2 weeks, then i am just a swing trader and not a value investor... If i plan to have a minimum holding period of 6 months to 1 year, then i wouldnt want to build a portfolio when sensex is at it's 31 month high. As a value investor, there is very little value in a market that has just another 3-4% upside potential...

Any value based investor will patiently wait for cheap value... its like i want to buy a flat and my time period is just just 1-2 weeks... then i look for value which is slightly less than market price as i dont have more time in my hand... but if i give myself 6 months to 1 year to find a flat... then i can patiently wait for attractive value...

Everything depends on the time frame you are looking at... If my time frame is 1-2 weeks to max 1 month, then fundamentals dont matter to me... why would i be interested in a stock that big funds dont find attractive enough...? Micro or macro picture means nothing to me... my only guide will be the technical chart... i wouldnt want to trade news based as by the time news becomes public, its already factored in the price... I'll end up buying right at the top and then will find new reasons for holding on to the looser...

 

[angira]

hi ever1,
I'm online only at 9 to 11 when market started coz i've job. i have not much knowledge of chart. I use EOD. I use Pivotpoint and NR7 theory and if stock break prev.day' high then entered to buy. NR7 is very powerful method but in pivotpoint and pre.day' high breaking theory is not working many times.So pls suggest me how to entered in market to buy/sell by using any software or chart theory or any other method. If we use chart then which indicator is most useful for day trading...