Sell in May and go away… Why?

Posted on July 3, 2014 by TraderHank
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Every year I hear this saying, but I've come to realize that starting in May through the month of August, Day trading becomes extremely difficult.  Volume drops off during these months especially during lunch and afternoons.  As a newbie trader these summer months used to get the best of me but now I really focus on the mornings and leave before lunch.  I've come to realize that this saying "Sell in May and go away" is really for the ole day traders.

I've not posted in awhile, not because I have not had any plays, but do to the fact that the summer doldrums have set in and I've just been grinding it out with just little profits to show.  Hey, it beats losing, I'll take a small profit anyday.  

I've had this chart saved to my desktop from June 18th on my play in RIG that I'd like to share.  After 5 green Daily bars up in RIG, price opened on June 18th by gapping down into the prior days green bar.  This caught my attention as a possible gap down surprise.  I found myself shorting the first 5 minute low with a small share size, then price bounced and rallied into the PDC and triggered another sell setup where I added more shorts to my play.  I had to set through a little pain as I watch price challenge the PDC line again and I was forced to cover the shares that I just added to the play.  Finally price rolled back over again and I added back the shares that I had just covered.  Price moved lower from here rather painlessly where I took some targets, I had one add and reduce area and watched price drop like a rock and finally trailed out of the play as a green COG appeared on the 5 minute chart.  I guess the bears were not done yet as I had to watch as the COG bar was then taken out buy another red bar and price moved lower in a flurry coming to .01 cent away from my original target at .52 cents.  Overall, a great play in RIG...

RIG 06182014
RIG 06182014
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SLB short revisited…

Posted on June 17, 2014 by TraderHank
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I almost went without a play this morning as nothing was setting up to my liking.  I finally found a 5 minute short in SLB that looked pretty good as the market started to sell off.  SLB had a nice low target of $106.00 and I felt that price would move lower after Friday's breakout failure on the Daily chart.  I entered the play @ .54 cents and price moved down nicely to my chicken target of .48 where I sold 1/4 of my shares. Price then moved sideways into lunch and finally mounting a 3 bar rally upward, allowing me to add back the shares that I covered.  Price again moved into the .48 cent area where I sold 2/3rds of the shares that I added back, holding a few shares for my lower targets. Price finally broke down and moved rapidly lower hitting my targets @ .22 cents, .17 cents and my final target of .03 cents.  Just a beautiful 2nd play in SLB in two consecutive days of profitable trading...

SLB 06172014
SLB 06172014

  

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Short play in SLB comes through big time for TraderHank

Posted on June 16, 2014 by TraderHank
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With the market powering upward into prior resistance, I found it hard to play the market long this morning as I was expecting a reversal perhaps at a reversal time.  By 10 am reversal time I found SLB setting up a 5 minute sell setup.  I was a bit hesitant since the market was still very bullish, but the 15 minute bar in the QQQ's had just closed with a wide range red bar which made me feel confident in my play in SLB.  I originally had SLB on my long list, but after the gap down, obviously it was no longer a long in my plan.  I entered short @ .28 as the sell triggered but price stayed bullish only moving sideways.  After setting through 30 minutes of pain, the overall market started to sell off hard and so did SLB as I took profits @ .96 after a long range red bar to the downside.  I soon hit my original target of .77 where I covered 1/2 of my shares and soon tailed out of the play @ .90 cents as the market was bottoming out at prior lows.  A great play to start out this week of trading!

SLB 06162014
SLB 06162014
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The one that got away…

Posted on June 12, 2014 by TraderHank
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I had FB nailed to the wall and I decided that since it was almost 12:30 pm that I should take my chips off the table for lunch and not continue my trade.  I usually like to have things wrapped up by lunch time for my morning plays especially early on in my career as a trader.  I'm finding that my batting average has been improving so much so, that I'm going to have to rethink taking off a trade just because of lunch time.  Today I had FB on my long list since the daily was setting up a nice 123 pattern.  The first hour FB closed with a solid green bar to the upside triggering the 123 but then, over the next hour, FB sold off hard engulfing the first hourly green bar by a wide range red bar causing a failure of the 123 pattern.  I figured that we should have another 2 hours lower so I was waiting for the next sell setup to get short in FB.  It was not long before FB set up a short near the PDC where I started my short with 1/2 a share size.  I had some nice lower targets @ 65.19, 64.59, and 64.29.  With nice lower targets and a huge void to the downside, I felt confident after the 123 failure pattern that price would continue lower.  Well, for over an hour, FB stayed bullish bouncing around just under its PDC almost stopping me out of the play but I was finally able to hang with FB as it started to move down.  I added and sold moving price where needed and I even had to sell some shares at a small loss to stay in the play.  As we were heading into lunch time I felt the need to take the play off at a break even and go to lunch only to come back later to find that FB hit all of my lower targets, OUCH!  I'm posting this as a reminder to myself to stay in the play until targets are hit or I get stopped out, or the day ends!

FB 06122014
FB 06122014

    

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A great short in WAG taken from the Long list…

Posted on June 6, 2014 by TraderHank
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I had a small list this morning with only 5 stocks on my daily list and no gappers this morning, but I did end up with a large 9:45 am wide range bar list but in the end I found my play on my daily long list in WAG.  I had WAG on my long list as I was looking for more upside in price since the RBI on Tuesday and Wednesday's breakout.  At the open WAG sold off hard bouncing off of major support and triggering a short sell setup at 10 am reversal time.  The market had gaped up but price was still sideways and I felt safe at attempting a short in WAG.  As mentioned in previous post, my line in the sand is the stocks PDC and WAG put in a beautiful topping tail bar just below the PDC.  With a huge void below, topping tail bar, a huge target @ 74.63, and at 10 am reversal time, the odds were in my favor big time, that this play could work out nicely.  I entered the play @ 75.33 and watch as price moved lower painlessly to my first profit area of .01 cents where I covered 1/2 of my shares.  Then price rallied into 10:30 am reversal time where I shorted more shares @ .21 and reduced my stop to .31 cents. Price again sold off painlessly and I felt that I would reach my ultimate target @ 74.63 but price stalled and I was forced to cover 1/2 again @ .05 cents only to watch price roll over a 3rd time where I added more short @ .95 cents.  I covered more at the prior low of .86 cents hoping to hit my .63 cent target but price finally started to rally just over 12 noon so If found myself trailing out of the play @ .93 cents.  With all of the adds and reduces, I made a full 2 risk units on the play.  A great play on Friday over a week of tough trading.  

WAG 06062014
WAG 06062014
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Two plays from Monday…

Posted on June 6, 2014 by TraderHank
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This week has been a grind as it seems the Summer Doldrums have hit early this year.  I'm up for the week but I've only been able to squeeze out about 1/2 risk unit per day.  It seems like its small but 1/2 risk units added up over the 5 days it's quite profitable.  I've got two trades from Monday 6-2-2014 that I'd like to share, my first is a trade in BRCM which I found on my Gap up list.  I rated BRCM as a Tier III gap that has the look and feel of a novice gap, but could be a great long after the initial day.  I was a bit aggressive on my initial entry, a 5 minute low, which I had to sit through a little pain as I watch price finally roll over.  After price went to profit for about .35 cents, for some reason I felt it was time to cash in on my play.  Really, I think the restroom was calling, but this turned out to be a huge mistake as price continued much lower.  I should have put my stop in and walked away, but these novice type gaps are played against the prevailing trend and are usually best played with a scalpers mentality.  Oh well, a profitable example that should have been an OMG play!

BRCM 06022014
BRCM 06022014

My next play came near 10:30 am reversal time in ALL which I found on my 9:45 am green wide range bar scan.  ALL's 15 minute bar put in a huge topping tail that, in the beginning, ALL would have not made my list, but I've learned that these topping tails clear out the sellers, so the next time price moves into the area, price will cut through these areas like butter because the sellers have sold already.  I did not take the first buy setup, but the 2nd buy was at mS at reversal time and I felt the odds were much better at this point so I piled in at .57 cents.  I sold 1/2 at a mid target of .72 cents hoping for an add and reduce play but soon my wide range profit bar was taken out by a huge red bar to the downside, thus I found myself covering the rest @ .68 cents.  A nice little play on this first Monday in June...

ALL 06022014
ALL 06022014

    

Posted in 9:45 Wide Range Bar Plays, Gap plays | Tagged , | Comments Off on Two plays from Monday…

Short trade in JOY makes for a profitable week

Posted on June 1, 2014 by TraderHank
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I've been on a roll again lately, my last losing week was the last week of April.  My goal is to be profitable daily, which leads to profitable weeks, then months.  My focus is just the daily part, the rest will take care of themselves.  As mentioned before, this week as been a struggle and I had a small loss going into Friday so my goal was to find one good play and shut it down.  I had found several good looking plays setting up, but finally I picked on JOY which I had found on my 9:45 am wide range red bar list.  Price action had actually gaped down then sold off hard leaving a huge red candlestick on the 15 minute chart.  At 10 am reversal time JOY looked like it was setting up on the 5 minute chart for a short but the chart put in a RBI which is not good and usually can lead to a measured move to the upside.  You can see on the chart that after the RBI long traders piled in long on the very next bar.  Finally at around 10:30 am reversal time a doji style narrow range bar appeared on the 5 minute chart.  My entry would be just below the Doji @ .41 cents with a full share size.  Now I was a little hesitant about the play but since price had stalled after watching the longs pile in after the RBI I figured that the bulls had ran out of gas.  My next concern was the RBI which is now an area of overlapping bars and would be an area of mS and as you look at the chart you can see that price did bounce off this area to retest the prior pivot high before rolling back over. But finally I got the breakdown that I was looking for and price started to move lower.   My original target was .11 cents but I just covered the entire position as a small green doji style bar closed on the 5 minute chart.  Price did hit my original target, but covering at .19 cents made the week green and that is all that matters on a very challenging week of trading.

JOY 05302014
JOY 05302014
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Pristine is all you need!

Posted on May 30, 2014 by TraderHank
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  I'm still attempting to catch up from my week in trading, but first I'm dumb founded on how many traders, educators, etc. still follow the news on the stock that they are trading.  Why make your life hard, when price, volume, and time is all you need to learn to trade the market successfully.  You would not believe how many times I've listened in on a pre-market internet broadcast and the host is reading the news, who cares what the news is, price action will always give you the answer.  Now, with my statement out of the way, on to my trade in SBUX.

My trade in SBUX was from Thursday and hit my screen as, "a result of price action... Cough, cough, ahh", a 9:45 am wide range red bar to the downside.  Since the market was rolling over hard @ 9:50 am reversal time, I felt that it was safe to enter on a GBI that had formed at 9:50 am that was engulfed by another red bar at 9:55 am.  My entry was a bit aggressive but I had a target at about .60 cents and felt that I had the market in my direction, but then the market bottomed and began to rally hard, as I watched my stop hit, Ouch!  With market still not committed yet to a long fully, I re-entered my play short at .91 cents as SBUX triggered it's first 5 minute sell setup.  This time I went in with 1/2 the normal shares and would be able to withstand a strong rally which would allow me to be more committed to reaching my original target of .60 cents with at least my starting share size.  As expect price moved lower but again bounced and rallied back up to the prior 5 minute pivot near the PDC and triggered a 2nd sell setup where I went to a full share size short.  I was not sure at this point if the play would continue to go lower and I was prepared to take my stop if needed since the PDC is my line in the sand for a short play.  Now with a full share size price moved lower, it was my goal to hit the target with my original share size so I ended covering 2/3rds at the first inclination that a rally was going to move prices higher which happened @ .98 cents.  I left on 1/3rd of the shares added to my play and watch as prices came up to base just under the PDC.  Finally prices moved down near 11:15 am reversal time with price giving me 4 sold red bars to the downside, then rallied two 5 minute green bars to trigger a 3rd, 5 minute sell, just below the PDC.  I added the same amount that I had added from my first add on the sell trigger @ .98, now I had a full share size plus 1/3rd more shares.  I really knew that I had the play in my favor so when I sold 2/3rds of what I had just added @ .94 cents, it was a rookie mistake.  Now I still had over a full shares and my goal was to take the full lot to target.  Well, I made it to .67 cents with over a full lot+, full share size and hugely profitable.  My goal is to bring you more plays like this, taking a full or larger size all the way to it's target with the original 1 risk unit stop, this will be the ultimate in my development as a master trader... 

SBUX 05292014
SBUX 05292014

 

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A nice mortgage type gap in RIG from yesterday…

Posted on May 29, 2014 by TraderHank
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With a short week, I've not been able to share any of my plays from this week so far.  Not a lot of action as the market has just been grinding up without a pull back which makes day trading extremely difficult.  Monday the NYSE was closed, Tuesday was a scratch trading day and so was Wednesday.  I got my butt handed to me today and at one point I was down 3 risk units early this morning, but I was able to fight back and ended the day down just 1 risk unit.  So I only have tomorrow to make this last week in May a winner.  My trade I'm going to share is from Wednesday 5-28 in RIG that I found in the morning while scanning for gaping stocks.  Rig was gaping below the previous day's green bar which I scored as a Tier II mortgage type gap.  I usually will wait for a pull back but the first 1 minute bar was a small topping tail or doji style bar and I found myself entering a little late but managed to get a fill short @ .31 cents.  Price sold off rapidly hitting my first target @ .10 cents where I covered 1/3rd of my shares.  Price just continued lower in a nice little grind to my second target of .65 cents where I covered another 1/3rd.  By 10:15 am I attempted a little add and reduce lowering my stop to .71 with my last remaining shares.  Unfortunately, I was trailed out of the play soon afterword @ .69 cents.  This happened to be my first real big winner of this shorten week...

RIG 05282014
RIG 05282014

   

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A Pete Rose day for TraderHank

Posted on May 21, 2014 by TraderHank
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Today’s trading kind of reminded me of one of my old time favorite baseball players Pete Rose.  Today was nothing but small base hits, I had to steal a few bases and finally with my play in WMT short, I had to knock down the catcher to score, wow, what a day it has been for traders.  I found WMT on my daily gap down continuation list from last Thursday 5/15.  Price in WMT actually gaped up but sold off hard into the base, then bounced but price could not make another higher high.  Price then sold off hard to test the lows again before bouncing off the lows and closing with a sold green bar to the upside just above the PDC.  The next bar was a red topping tail bar that I shorted with a full share size @ .59 cents, right at 10:30 reversal time.  I covered 1/3rd at my chicken target of .49 cents and was forced to cover another 1/3rd @ .52 cents.  At this point with a 1/3rd share size left, I was looking for an add and reduce area which soon triggered by 11:00 am just below WMT’s PDC where I went to a full share size again.  After a small red doji type bar over a 5 minute period, price started to move down nicely but then on the 4th red bar down closed as a green bottoming tail bar (COG) that I was forced into selling 1/2 of my shares.  The next bar put in another red topping tail bar that I added back shares to my play and also reduced my stop.  Then, another green bar formed with a topping tail that was followed again by a red engulfing bar allowing me to add even more shorts to my play.  I had my mind made up that I was going to hang with this play to the target @ .36 cemts.  After 10 minutes more price took out the top of one of my red bars where I had to cover 1/2 of my shares, but then I got the reversal bar that I was looking for and price headed lower in a flurry hitting my target @ .36 where I covered 1/2 of the shares that I had left.  After a V type bottom formed with a green doji style bottoming tail, I decided the target had been hit and I covered the last of my shares @ .38 cents.  Wow, I was working it, but I’ll take the nice 1 R profit on the play!

WMT 05212014
WMT 05212014

   

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