[INTRA-DAY ACTION]
24 stocks on my monitor this morning, and all of them are red. FTSE is down 2.1% and there are a lot of stocks crashing hard. I've made my bread today in another SCHE trade within 30 minutes of the bell, and for a laugh, I tested how long it would take to make a "summer job" hourly wage trading a stock. I traded INCH short, and closed after 10 seconds to make £8 profit.
At the moment (10:27am) I am waiting for a few stocks to break some round number barriers, in particular INCH (300), TNI (100) and REL looks like it just broke 550. CBG has been interesting to watch this morning, I nearly took a long at confirmation of 550, but I didn't like the book and it dropped to current price of 533.
Despite the negativity, some of the stocks I'm watching are holding the key support and resistance prices and at a glance this is happening in AFR, SGRO and SHB. On the flip side, my predicted drop to 1250 on SVT is looking like either covering the short or putting in a tight stop as it is at 1256.
However this morning we have triggered entries in ENRC, FXPO, INCH, SIG and WPP. These entries are all short.
10:50 AM update
This time of day is good for relaxing. Generally there is a lull that comes in at around 10:15am, after most of the action has happened. I'll post a few tiny charts just to prove a point. If you're a trader, this is a good time to take an hour out to catch up on some news, watch tv or just chill out. The action should start again just pre and post lunch around 1pm.
Most of the stocks I'm looking at are trying to establish daily support before any retracements, so a good time to close and reverse too - which I wish I had done in my trades thus far. The close and reverse strategy is something I never really thought about before - mostly because I could only go long. But if you're stopping a trade because it's hitting support or resistance, or looks bad - then that means it's going to go the other way right? This is a strategy I'm looking to exploit in the coming weeks.
Update 15:30
Pretty bad afternoon, and a lesson learned here. Was up a decent amount, but gave back a bit of it this afternoon in a series on tiny losses on trades that backfired straight away. I think a lot of this is the "don't let a winner become a loser" mentality, so I'm closing out really really early if it doesn't go my way from the bat. I was actually in a trade for 47 seconds, which is unbelievable.. however I made the right call to get out as it went the other way, but I didn't reverse.
Despite shorting FXPO on constant daily lows I still ended up with 3 scratch trades in that, and 2 in BARC which I'm not even sure why I was trading.
I've noticed something dodgy twice today now, as stocks approach key levels, there are huge orders on the bid or offer sides (ie 50k stock at a nice round number), which appear when the stock approaches this. I think it was TNI and FXPO this happened on, as soon as the stock found support at the huge order, it would bounce, and then the order would be wiped off the book instantly.
The trick seems to just trade the first hour only, and then get on with your day. I have halved what I was up this morning on scratch trades and bad entries by hanging around because I've got nothing else to do.
This afternoon has been extremely volatile. The FTSE was down 2.5% in the morning. It hung around there for quite a while, and at about 1:30pm, it gained 0.1% and everything started to rally, and then crash, then rally and then crash again. If traders and investors think that this 0.1% intra-day retracement is a signal that the bear market is over, and the credit crunch is behind us, then I hope they are losing money.
At the moment (10:27am) I am waiting for a few stocks to break some round number barriers, in particular INCH (300), TNI (100) and REL looks like it just broke 550. CBG has been interesting to watch this morning, I nearly took a long at confirmation of 550, but I didn't like the book and it dropped to current price of 533.
Despite the negativity, some of the stocks I'm watching are holding the key support and resistance prices and at a glance this is happening in AFR, SGRO and SHB. On the flip side, my predicted drop to 1250 on SVT is looking like either covering the short or putting in a tight stop as it is at 1256.
However this morning we have triggered entries in ENRC, FXPO, INCH, SIG and WPP. These entries are all short.
10:50 AM update
This time of day is good for relaxing. Generally there is a lull that comes in at around 10:15am, after most of the action has happened. I'll post a few tiny charts just to prove a point. If you're a trader, this is a good time to take an hour out to catch up on some news, watch tv or just chill out. The action should start again just pre and post lunch around 1pm.
Most of the stocks I'm looking at are trying to establish daily support before any retracements, so a good time to close and reverse too - which I wish I had done in my trades thus far. The close and reverse strategy is something I never really thought about before - mostly because I could only go long. But if you're stopping a trade because it's hitting support or resistance, or looks bad - then that means it's going to go the other way right? This is a strategy I'm looking to exploit in the coming weeks.
Update 15:30
Pretty bad afternoon, and a lesson learned here. Was up a decent amount, but gave back a bit of it this afternoon in a series on tiny losses on trades that backfired straight away. I think a lot of this is the "don't let a winner become a loser" mentality, so I'm closing out really really early if it doesn't go my way from the bat. I was actually in a trade for 47 seconds, which is unbelievable.. however I made the right call to get out as it went the other way, but I didn't reverse.
Despite shorting FXPO on constant daily lows I still ended up with 3 scratch trades in that, and 2 in BARC which I'm not even sure why I was trading.
I've noticed something dodgy twice today now, as stocks approach key levels, there are huge orders on the bid or offer sides (ie 50k stock at a nice round number), which appear when the stock approaches this. I think it was TNI and FXPO this happened on, as soon as the stock found support at the huge order, it would bounce, and then the order would be wiped off the book instantly.
The trick seems to just trade the first hour only, and then get on with your day. I have halved what I was up this morning on scratch trades and bad entries by hanging around because I've got nothing else to do.
This afternoon has been extremely volatile. The FTSE was down 2.5% in the morning. It hung around there for quite a while, and at about 1:30pm, it gained 0.1% and everything started to rally, and then crash, then rally and then crash again. If traders and investors think that this 0.1% intra-day retracement is a signal that the bear market is over, and the credit crunch is behind us, then I hope they are losing money.
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