This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

Over the last few days, I’ve taken a few trades from Renko charts, trying to follow some intraday trends on high-volume volatile stocks. I like that Renko charts define the trend for me, once I pick a box size. A retrace is also clearly defined, as a two brick reversal will reverse the trend. the problem is whipsaws, but so far I’ve been lucky and haven’t hit any to speak of. The idea is to go long on the first green bar, close the long and go short at the first red bar. The red / green lines on my chart are just visualizations of the trailing stop for me. Just playing small, pseudo-paper-trading this system–without $ on the line, even a tiny amount, I just can’t get interested in paper trading, so that’s why I’ve been trading. I’ve made about 4R so far with these, and even trades that reverse tend to let me get out at breakeven for the most part. Here’s the charts–sorry that they’re not more annotated-I’m in a hurry right now:

As part of working on my discipline and psychology, I’ve been focusing on reasonable trading goals and personal expectations over these past few weeks. Working on my self-image and success criteria. I have discipline, because I can force myself to look at the screen all day forcing trades, even when it’s painful. I’m driven by my goals for myself, and in the past, I have been racing. I’ve been too greedy. I want a fortune, and I want it now! Bad idea. Leads me to trade in the noise with positions that are too large, and force a trade that’s not really there, and overtrade.

After much soul searching and reading, I’ve come to a more reasonable expectation and goal. For me, right now, I have the goal to make +1R each day that I choose to trade. I think that is an achievable goal. Then if I make +2R on the first trade, I have one more opportunity to trade, knowing that even a 1R loss will keep me at my goal. Nice peace of mind! Only 1R doesn’t seem like much, but only +1R per day, if that’s 1% of my equity, over roughly a year (250 trading days) I will return over 200% on my account. Word.

Well, I took one discretionary trade (not Renko) in AKAM. Ragin Cajun called it on Wallstreak. Go to madstocks.com and read his blog–he’s been minting coin at a criminal rate lately. He saw the daily, and so did I. The 38 level was key–if it broke we’d go to 36:

Well, it did but I didn’t quite make it:

Traded on the 15′ with a wide stop felt good. My size was small, and even though I didn’t get the whole move I pulled out +2R without too much trauma. Exceeded my goal! Showed discipline, it’s all goodness. I accept where I am, and it feels good.

I need to work a bit longer on this mindset and discipline to make it stick, and then I’ll move on to Step 3 in my plan–laying out my trading roadmap.

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

One nice thing about having multiple bloggers in one place, is that when you don’t have time to write anything, the blog still stays active. Thanks, everyone!

I’ve not much felt like blogging this week, since my social calendar has been pretty full. I’ve got yet another party to go to this weekend, in fact. It’s been fun, but kind of exhausting. And, there really hasn’t been much to blog about anyway. The markets have been ugly, so I haven’t made many trades.

I did make two trades today, which were both winners. That may be a good sign that things are returning to normal. We’ll see about that, Monday, I guess!

Even when I don’t blog, you can still catch me talking most days on wallstreak and jaiku for semi-realtime info on what I’m up to. When possible, I call the trades I’m considering beforehand, so others have a chance to chime in, or join in the profit. (of course, if you don’t trade exactly like me, then obviously your results may vary). Today I called my trade in FDO, and a play on AKAM that I didn’t take because I was already done for the day, for instance.

Here are my reviews of trades I made way back on March 29th 2006. Compared to the set from the 28th, it seems like I really improved, overnight (but it’s actually just an indication of how inconsistent I was).

Trade 1, RHAT

This one is easily the worst of the batch. Here’s the chart with my original 2006 comments on it:

I think it’s hilarious that I said my exit looks ridiculous. I think my entry point looks pretty darn ridiculous. Well, I’ll at least give myself points for observing the natural round-number resistance at 28. But, look at the whitespace between the stock and the fast ema at the open. That sucker was pretty likely to keep running up. It seems like I was selectively oblivious to the price’s relation to its 8EMA, because the next two trades are based on this relationship.

I think I said it all back in 2006: “I have no idea … how much the stock will move, or in what direction.” Hmmm… then I wish my 2006 self would have gone on to remind me why I took the trade in the first place. Stupid trade.

Trade 2, ENER

I like this trade. There’ve been a couple others like it in this review series already. In fact, I don’t know why I’m not taking trades like this today. They make sense. As you’ll see, though, I seriously jumped the gun on my execution. Here’s the chart with my 2006 comments:

There was ample room for this stock to fall down and consolidate, which is good. 75 cents between my entry, and the 8EMA at the time of entry.

I guess I’ll give myself points for trying at a round number, and maybe in a sub-15 minute chart I’d see that it hesitated prior to my short. But, 30 minutes later than my actual trade would have been a much better entry. A weak 15-minute candle that didn’t make a higher high…

As with all these early trades, I don’t mention where my stop was, but I bet it was either $0.50 or $1.00. I was trading in the Millenium Traders chatroom back then, and they always used $1.00 stops, so I did that sometimes. I would have used $0.50 because that’s about a 1% stop loss in terms of the stock price.

So, good idea, good candidate, very bad execution.

Trade 3, RACK

This is the same theme as the ENER trade, only it’s the move after the retrace to the fast EMA. I like this play.

Once again, though, I completely jumped the gun on my entry. It would appear that I entered simply because the price touched the 8EMA. That’s silly. The following candle showed weakness and would have made a better place to enter.

Trade 4, AKAM

This last trade was definitely influenced by my time in the Millennium Traders chat room. We constantly bought dips in uptrending stocks. If you follow what I write here at the site, and elsewhere, you know I still like this idea… I just don’t know how to safely execute it. Trading breakouts is much more clear-cut.

I give myself credit for keeping the round number 32 in mind, and recognizing a double top as my cue to exit.

I said in my 2006 comments that the 1:00 pullback would have been a good entry. If I had taken that entry today, I’d have been stopped out at 1:30. I clearly used wider stops back then.

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I traded Akamai Technologies, Inc. (NASDAQ: AKAM) today. I should have traded my NR7 scan, as I’d be up a bunch shorting DNDN, but anyway…

I tried to trade off of a 1 minute chart. I was late to the party as price broke $43.50, but the volume was picking up, so I went for it. I also wanted to use a very tight stop, to try to give me a chance for a big R gain, but it was not to be:

My read of the price action was right, which is shown by the rest of the day’s action, but I didn’t want to re-enter to save on my allowed daytrades. It even went on to hit my original target:

I would have re-entered if I had no other restrictions. Pattern Daytrader Rules are killing me. I feel like I could do much better if I was over the $25k hump. :(

Trade Summary:

AKAM Short 98 Shares
Entry: $43.34, Stop: $43.50, Target: $42.44
R: $15.68, Exit: $43.52
P/L: -1.13R, or ($17.64)

Trade Grade:

Stocks Mentioned In This Article
Stock	Links
AKAM	| |

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

Here’s the watchlist for today: EPCT, HMA (looks bogus to me), AKAM, ANO, CF (from yesterday’s list as well), and MNST.

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

Here’s three quick trades that I took as overnight plays ($@#%^& “Pattern Day Trader Rules”! cursecursemuttermutter). I entered within the last half hour of trading yesterday based on my read (i.e. Feel ‘em) of the charts. My intention was to hold overnight and then exit within the first 30 minutes this AM, which I did. Read the rest of this entry »

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I made four trades today. You’ll probably want to check the url and make sure you are actually at Move the Markets. It’s okay, I’ll wait…

Yep, it’s really me. I’m really wanting to follow through on making more trades per week, as long as they are good. But, that’s not all! Over the weekend I decided these 0.3R wins are for the birds. Many of my trades over the last few weeks went at least twice that far without me. I have a statistical obligation to hold on longer! So how did that go?

Not just real well today, but it’s entirely my fault. The biggest problem was, I started the day off with two complete losers. You know, the kind where you can imagine the MM’s laughing at you for buying at the exact top, while they push the price down below your obvious stop? And, to make it worse, both losses were on the same stock, Akamai Technologies Inc (Nasdaq: AKAM). After the first trade (click to enlarge)…

…I felt like I was robbed… it took out my stop by just a few cents, at a time when the markets were negative TICK-wise. I thought it just got caught up in the overall market emotion. As if to confirm this, it recovered in a pretty orderly fashion. So, when it made new highs again, I didn’t have to think too hard about buying in again:

… but if the first trade was a robbery, then this was cold-blooded murder. It pretty much dropped from the moment my order was filled, 1 cent from the top of that move. I am pretty happy with my stop, as the price did bounce off it a bit before falling through. I felt like it at least gave me a shot at recovery.

You can imagine, this is not the way I would have preferred my morning to go. Especially since the first AKAM trade would have yielded my typical 0.3R profit, had I stuck to my old strategy. But, that’s the way it goes, and we just pick up and move on.

Moving on… I spotted Cameron International Corporation (NYSE: CAM) setting up pretty well on consolidation after a vertical spike. I wanted to be filled at 50.55, but got filled at 50.60 instead. What a great start. Ofter reaching 0.5R, I really wanted to get out, since I was still a little thrown off by the two losses this morning. But, I knew that wasn’t the way to ultimate victory, so I held on. Then it dropped to my entry price, and I didn’t have the guts to hold on to it. I got out for a 1 cent gain. I would call that a mistake, since my previous trades shouldn’t really have anything to do with this one. Had I held on, I would have had a 1+ R gain.

Last trade of the day was on McDermott International (NYSE: MDR). Again, I was gun shy. I was a few cents shy of the 1 R profit point, when it dropped and gave up half those gains. It would have been more proper to stay in, or at least wait for breakeven like I did with CAM. Instead, I was a wimp and took 0.5 R. If you glance at the chart, you’ll see that staying in would have made me at least 1.75 R.

So, I let my horrible morning affect my trade management in the afternoon, which is always a bad thing. Not the worst mistake you can make, for sure. But, instead of ending up slightly positive for the day (as I would have, had I held on for higher profits), I ended up down 1.5R. StockTickr has reports that tell me Mondays are my worst day. I should never change up my strategies on Mondays, probably!

It will be an interesting week, to see if I scurry back to my scalping ways, or if I can tough this out a little.

Stocks Mentioned In This Article
Stock	Links
AKAM	| |
CAM	| |
MDR	| |

If you want to see how I only wish I had played Akamai (Nasdaq: AKAM) today, check out today’s post at Wall St. Warrior. My goodness… it puts my little AKAM scalp to shame. I was only playing the break of 42, while it appears this trader played the run up to 42 as well. I’ve often wondered if I should try to do that, as it seems the price naturally runs right up to resistance, whether it breaks or not.

Anyway I’ve seen Wall St. Warrior in people’s blogrolls, but I haven’t had a chance to check out the blog yet. It’s got my attention, now, though! I’ll be reading through it as time allows this week, and seeing what it’s like. I saw the article I linked above while vanity searching, of all things (we’re both linked from google finance’s page for AKAM today, due to our blog posts).

Stocks Mentioned In This Article
Stock	Links
AKAM	| |

I’ve been waiting for Akamai Technologies, Inc (Nasdaq: AKAM) to break 42 for a long time. After this morning, I was pretty sure I’d be waiting at least another day. But, as luck would have it, the markets completely turned around by 11AM or so, and I had my chance.

However, while the setup was great, this one really stretched my criteria for entry. There was no good, tight stop available, since the stock broke from the 41.85 area, rather than just under 42. The most reasonable stop I could see was like 60 cents from my 42.14 entry. Way too wide for my risk:reward tastes… it wasn’t a foregone conclusion that it would run past 43 by the end of the day. Not in my mind, anyway.

So, I nearly passed, but decided I could at least get in and out quick with some profit. Here were my three reasons why:

• I knew a lot of traders must also be watching this obvious 42 level, since the stock’s been trying to break it for weeks. So, there was bound to be a mass of excited buying for a bit.
• The markets, for whatever reason, had turned extremely positive right about at my entry time. I saw the NYSE TICK hit 2500 several times, without the usual resultant selling.
• BIG relative volume on the break of 42.

(although I admit part of it was that I had waited too long on this stock to not put some kind of play on… I’m only human.) So, I picked the somewhat arbitrary 41.99 stop, and planned to essentially ride the initial wave of enthusiasm. That’s exactly what I did… in and out in 75 seconds for 1.6 R of profit. Had I stayed in, I would have made a lot more money, but that wasn’t the kind of trade I felt comfortable making.

Here’s the chart (click to enlarge):

I did plan to get back in on a pullback that would have provided a low-risk entry, but I didn’t really see one that thrilled me before it got too late in the day to consider it.

A Case of the Mondays
Oh, well. It was a profitable Monday (100% win rate, too), so I can’t complain. A prototype StockTickr report, not yet public, tells me my expectency by day of week. It confirms what I pretty much knew… I suck on most Mondays! It’s my lowest expectancy weekday, historically. If I were to guess why, I’d say it has to do with remaining hangups I have about wanting to be profitable each week. I don’t want to start the week in the red, and the extra pressure hurts my decision-making, maybe? Or, maybe, I am just out-of-synch with the markets after the weekend break? Regardless, it’s interesting information.

Stocks Mentioned In This Article
Stock	Links
AKAM	| |

Early on, it looked like I might break through my undertrading barrier today. Several of my watchlist items were sending me alerts. But, as it turned out, most were not tradeable. Let’s see ‘em…

First, National Oilwell Varco Inc. (NYSE: NOV) gapped through my target of 64 on the open. If it were a small gap I’d consider my trading options, but it had gapped all the way to open at 65.50, and approached 68 within the first 20 minutes of trading. So, so much for NOV… I’m noting now that it closed at 64.20, so if it bounces off 64 tomorrow I may get in. Then again, it may be trying to close that gap…

Next, Ceradyne Inc. (Nasdaq: CRDN) tapped the highchartpatterns target of 50, but didn’t trade in a way that triggered the trade. It made a couple half-hearted tries to re-reach 50, but gave up by noon. So, again, close, but no cigar.

Next, Garmin Ltd. (Nasdaq: GRMN) fell through highchartpatterns target of 95, and triggered the trade. However, it fell so fast my order did not fill, and I’m convinced I would have been screwed on a market order in that action. So, I had to sit this one out. That’s a ten-minute candle, where it falls from 95.65 to 92.07 and climbs back to 94.12. That’s volatility!

Seeing that Akami Technologies, Inc. (Nasdaq: AKAM) gapping up, I changed my view of it from short to long, chosing an entry point above 37.40 based on the weekly charts. When I was out at lunch, I got the email that said it traded at my price. Man, I could not get a break! But, I checked with my blackberry a few minutes later, and saw that it had already fallen to 36.20 again. So there wasn’t even a trade to miss! What a frustrating day! But, I’ll note that it closed reasonably strong at 36.83, so any kind of healthy follow-through tomorrow has a chance to get me into the trade.

So, after I got back home from lunch I made one trade, in United States Steel Corporation (NYSE: X). I got 1.5R out of it. You can see my sloppily scratched blue lines marking my entry and exit.

Unlike yesterday’s 1R loss scenario, I tried to be very aware of whether I felt a need to take profits, or if I feld that the trade was turning against me. You can see that the exit candle closed near its high (I think these are called Doji’s when they close at their open prices, but I don’t believe in the named candle patterns intraday). So, when it was steadily climbing, I decided the stock could reverse. The markets where positive/negative/positive see-sawing in the afternoon. Eventually, you can see that the stock made lower lows by the close, but I would have stopped myself out at breakeven before that, in the candle after my actual exit. So, I am pleased with my choice.

I hope everyone had a good trading day!

On Pivots
After seeing a note yesterday on Trader-X’s blog, I was reminded that I have been meaning to see what pivot points can do in sideways markets. I had read about a pivot strategy for flat markets in a book a few months ago. So, last night and during today’s session, I kept the standard pivot points overlayed on my charts. At first glance, it does appear to be uncanny the way they line up with the actual price action. I know the formulas for the pivot levels, and I can’t think of any reason why they hold so well. One explanation, obviously, is that enough traders use those pivots to make them a self-fulfilling prophecy. Another explanation, is that my eyes are drawn to spots where the prices and the lines match, and I unconsciously ignore all the places where there is no correlation whatsoever. More investigation is needed.

Stocks Mentioned In This Article
Stock	Links
NOV	| |
CRDN	| |
GRMN	| |
AKAM	| |
X	| |

[Edit: 5/30/2007: I've re-reviewed these trades here, now that I have another year of experience to bring to the table.]

My best day so far, though it’s hard to take too much credit because the markets were really moving today! In fact, I should be hard on myself for not taking more money out of it. I will be analyzing all my trades and scans this weekend to improve.

Here are the charts with commentary at the top. The second trade I got antsy and took a 1 cent loss rather than hold on for the profits that followed. It was my first and only losing trade this week, so far.

I’m so pleased that my first few days have been in line with my price targets. Who knows what it would have done to me, psychologically, to lose a lot of money my first week without a day job!