Here's my thoughts on a TNA short trade earlier this week.1. Set the stop just above the high so that it will have to make a new high in order to stop me out.
2. Declining volume on the way up suggests that the buyers are not strong.
3. The trade works. As it falls I double and triple up because that is how I make money - by adding to winning trades.
4. Cover after the volume spikes. That is when bounces happen. A nice even dollar level is more reason to cover. A multi dollar gain is even more, more reason to cover.
7 comments:
Thanks for the insight into how your mind is processing the information. Posts like this are very helpful!
-Trevor
Nice. That helps. With my focus on trendlines, S/R, and triangles, I often forget to read volume at times other than when it spikes.
bct, it's amazing how scott reads everything so quickly. i know he has a check list like, check spread, check volume, etc...i even had it written down and sometimes i would still forget. then in reviewing the trade, i go "why didn't i see that" but i think in the moment your mind tells you want you want to see. kind of like you can read this without the letters being correct.
Arocdnicg to rsceearch at Cmabrigde Uinervtisy, it deosn’t mttaer in waht oredr the ltteers in a wrod are, the olny iprmoatnt tihng is taht the frist and lsat ltteer are in the rghit pcale. The rset can be a toatl mses and you can sitll raed it wouthit pobelrm. Tihs is buseace the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe
j- not really amazing. just checking spread and volume can be done at a glance and thats only for the first time traded. stocks like TNA, FAS are always high volume,low spread so you don't even need to look them. then its just a question of free your mind to see what they are actually doing and trade accordingly.
It's been awhile - but finally found some time to catch up on my reader subscribes.
4 months and no trading. How is that for a fresh perspective?
I was struck with how simple your charts are Scott - and how elegant the trades. Pfft. The usual! =) There is something fresh about it though with a new set of eyes. I appreciate this breakdown. Trade hard! Trade well! Bankrobber baby.
Clever illustration Fozz!
DTF- funny you should say that - when I look at other traders charts they are so complex I can't make out what they are doing. multiple indicators and lines every which way. I've found simpler is better and they more I can strip things down to the basics the quicker I can make decisions, especially at times when the markets are moving fast or pressurized situations.
Yeah - for sure Scott!
When I was looking thru your charts yesterday, my thoughts were something along the lines of - 'Wow - these charts are so simple... beautiful really.' Then I was like... heh - but that is exactly what Scott keeps saying over and over again. =)
Cheers bro - thanks for continuing to post.
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