How 'bout that stock market?

[steveny]

Everyone have on their seatbelt?
How low is it going to go? 7,000 anyone?

No, it's rigged it ain't ever going that low again.

You know why it dropped 900 points in a few minutes right? It was shut down but the ECN's weren't. It will be shut off before it sells to 7k and this time the ECN's will get shut off too. They will jam platforms and bottleneck trading. The economy is great, go stock market TO>>>THE>>>>MOON
LOL
with that said. I have been doing ok except some bad XOM option trades last week that I had to get the trades busted. friggen ridiculous. Lost some $ on GS option spreads too but made it up else where. Ended up down a bit overall last month.

 

[sahtt]

If you have a time machine, do not go long over last night. Unless you are a glutton for pain like I am.

 

[SilverStone05]

No, it's rigged it ain't ever going that low again.

You know why it dropped 900 points in a few minutes right? It was shut down but the ECN's weren't. It will be shut off before it sells to 7k and this time the ECN's will get shut off too. They will jam platforms and bottleneck trading. The economy is great, go stock market TO>>>THE>>>>MOON
LOL
with that said. I have been doing ok except some bad XOM option trades last week that I had to get the trades busted. friggen ridiculous. Lost some $ on GS option spreads too but made it up else where. Ended up down a bit overall last month.

Yea....the specialists shut down trading causing a great deal of liquidity to vanish, but the ECN's continued trading electronically....way to make markets and be a buyer of last resort, nyse specialists.

The NYSE is pointing fingers at electronic trading for the foul ups but any fool can deduce that suspending trading and removing liquidity is the worst thing you can do in a free falling market. Specialists suspended trading not to ensure an orderly market, but to protect their own interests. How ironic.

 

[steveny]

Yea....the specialists shut down trading causing a great deal of liquidity to vanish, but the ECN's continued trading electronically....way to make markets and be a buyer of last resort, nyse specialists.

The NYSE is pointing fingers at electronic trading for the foul ups but any fool can deduce that suspending trading and removing liquidity is the worst thing you can do in a free falling market. Specialists suspended trading not to ensure an orderly market, but to protect their own interests. How ironic.

Yeah, sure wish I could have suspended trading in 08. Hell I wish I could have gotten a friggen trade in when the platforms were locked up

 

[SilverStone05]

Hell I wish I could have gotten a friggen trade in when the platforms were locked up

I did.

And the bastards cancelled it.

 

[steveny]

I did.

And the bastards cancelled it.

Yeah that's what I keep extra keyboards around for.

HEY... it's raining buttons, someone get me another keyboard pronto. :biggrin:

 

[bambbrose]

I've followed this thread for a few years now as I finished up school and now I'm starting to get a bit more involved in trading.

I'm now steady with full time salaried employment and saving ~15% of income for retirement and an additional ~10% for investments. I've done a lot of risk calculation and concluded that the 10% is completely safe for me, even if I lose it all. I'm extremely young so I want to hit this hard and right.

So a few questions. I've noticed that most of you follow the stocks you trade very closely, watching for news, updates, info, etc. on a regular basis.

First, how do you decide upon the stocks that you trade? It seems that you can only pick a few due to lack of time to study each of them in depth. How do you manage that time? How many stocks can you trade while feeling comfortable in the knowledge you have? What improvements have you made to increase your capacity?

Second, what are your primary sources of information? I'm looking for extremely reliable and very quick sources that would be used for day trading and similar high risk high speed trading environments.

Third, have you set up day trading stations at home? Are they simple systems or vast multi-monitor setups with flagging/color indicators, etc.?

Thanks for your help for a newbie

 

[jonas1jp]

I've followed this thread for a few years now as I finished up school and now I'm starting to get a bit more involved in trading.

I'm now steady with full time salaried employment and saving ~15% of income for retirement and an additional ~10% for investments. I've done a lot of risk calculation and concluded that the 10% is completely safe for me, even if I lose it all. I'm extremely young so I want to hit this hard and right.

So a few questions. I've noticed that most of you follow the stocks you trade very closely, watching for news, updates, info, etc. on a regular basis.

First, how do you decide upon the stocks that you trade? It seems that you can only pick a few due to lack of time to study each of them in depth. How do you manage that time? How many stocks can you trade while feeling comfortable in the knowledge you have? What improvements have you made to increase your capacity?

Second, what are your primary sources of information? I'm looking for extremely reliable and very quick sources that would be used for day trading and similar high risk high speed trading environments.

Third, have you set up day trading stations at home? Are they simple systems or vast multi-monitor setups with flagging/color indicators, etc.?

Thanks for your help for a newbie

Through it all, I've found ETrade to have great tools. They may not be the best, because I haven't tried everything. But there is a ton of education on their site to be had. A great platform too with ETrade Pro. There are a bunch of high-dollar trading software platforms, but it's not the platform that will make you successful. That's like saying your playing like Spalding (Caddyshack reference) on the golf course and it's because of the clubs you're using. Educate yourself, set your limits, your objectives, and make a plan. That's the core of finding success.

 

[bambbrose]

Through it all, I've found ETrade to have great tools. They may not be the best, because I haven't tried everything. But there is a ton of education on their site to be had. A great platform too with ETrade Pro. There are a bunch of high-dollar trading software platforms, but it's not the platform that will make you successful. That's like saying your playing like Spalding (Caddyshack reference) on the golf course and it's because of the clubs you're using. Educate yourself, set your limits, your objectives, and make a plan. That's the core of finding success.

Thank you for the response. Are most people just relying on the trading platform for information?

Or do you guys even look at information? It seems like a lot of the books that I'm reading, and I'm reading one a week right now, primarily focus on just reading charts, identifying trendlines, SMA/EMA, P/E ratios, etc.

Are you guys actually researching the companies you trade or do you just use the data provided by the trading platform you have?

Does anyone watch google trends or similar websites for search hits to see if interest is up on a certain stock?

I've got tons to learn still, and the more I learn the more I realize I have to learn, but I know a lot of the members here are successful and therefore have good knowledge to share.

Thanks again:smile:

 

[wctsao]

Thank you for the response. Are most people just relying on the trading platform for information?

Or do you guys even look at information? It seems like a lot of the books that I'm reading, and I'm reading one a week right now, primarily focus on just reading charts, identifying trendlines, SMA/EMA, P/E ratios, etc.

Are you guys actually researching the companies you trade or do you just use the data provided by the trading platform you have?

Does anyone watch google trends or similar websites for search hits to see if interest is up on a certain stock?

I've got tons to learn still, and the more I learn the more I realize I have to learn, but I know a lot of the members here are successful and therefore have good knowledge to share.

Thanks again:smile:

Here are some things I would recommend.

For money and risk management
"Come into My Trading Room" - Elder
(Amazon should have this)

Learning to read charts, trendlines, support/resistance, etc.
"Getting Started in Technical Analysis" - Schwager
http://www.stockcharts.com (free)

For strategies:
http://www.aaii.com ($29/yr)
http://www.investors.com (A bit more expensive but some folks love it)

For finding new stocks:
http://www.aaii.com (each strategy provides monthly picks)
http://www.stockcharts.com (has predefined scans)
http://www.barchart.com

If you interested in finding which sectors are strong and weak:
http://www.smartmoney.com/map-of-the-market/
http://bigcharts.marketwatch.com/industry/bigcharts-com/

Paper Trading
http://www.updown.com

Good luck.
William

 

[sahtt]

I've followed this thread for a few years now as I finished up school and now I'm starting to get a bit more involved in trading.

I'm now steady with full time salaried employment and saving ~15% of income for retirement and an additional ~10% for investments. I've done a lot of risk calculation and concluded that the 10% is completely safe for me, even if I lose it all. I'm extremely young so I want to hit this hard and right.

So a few questions. I've noticed that most of you follow the stocks you trade very closely, watching for news, updates, info, etc. on a regular basis.

First, how do you decide upon the stocks that you trade? It seems that you can only pick a few due to lack of time to study each of them in depth. How do you manage that time? How many stocks can you trade while feeling comfortable in the knowledge you have? What improvements have you made to increase your capacity?

Second, what are your primary sources of information? I'm looking for extremely reliable and very quick sources that would be used for day trading and similar high risk high speed trading environments.

Third, have you set up day trading stations at home? Are they simple systems or vast multi-monitor setups with flagging/color indicators, etc.?

Thanks for your help for a newbie

I was a professional securities trader for several years (still registered etc.) and had some modest success with great consistency. I joined a small consulting firm locally recently to learn some new skills. You can read books and learn a lot about investing/trading. A formal education on how markets work is beneficial. I have one of those 'vast' setups you mentioned with multiple monitors, quad core computer, best internet money can buy, etc. That being said, I haven't made more than a couple trades a month since mid June.

Why?

Knowing when to do nothing is the most difficult lesson to learn in trading. Most people go broke before they reach that level of maturity, regardless of the previous success. Think of all those nasdaq traders and how 99% were blown out as the market rolled over. Think of all those who rode the DOW 14k bull $hit train and didn't get off until it derailed and blew up well under 9k.

I'm sitting on the sidelines collecting dividends (except from BP -_-) and don't see that many great opportunities out there due to the uncertainty marco wise and high valuations of the markets. Be careful.

 

[sahtt]

Thank you for the response. Are most people just relying on the trading platform for information?

Or do you guys even look at information? It seems like a lot of the books that I'm reading, and I'm reading one a week right now, primarily focus on just reading charts, identifying trendlines, SMA/EMA, P/E ratios, etc.

Are you guys actually researching the companies you trade or do you just use the data provided by the trading platform you have?

Does anyone watch google trends or similar websites for search hits to see if interest is up on a certain stock?

I've got tons to learn still, and the more I learn the more I realize I have to learn, but I know a lot of the members here are successful and therefore have good knowledge to share.

Thanks again:smile:

IMO I wouldn't confuse investing and trading, I look at them completely differently. Trading is about identifying the regular behaviors of buyers and sellers. Investing should be identifying a balance of firms that return value to their shareholders. It could be as simple as creating a program to track when size (10k blocks or larger on smaller caps i.e.) enters the lvl 2 window or as sophisticated as tracking special quote conditions by the specialist on the NYSE and programming a black box and 'voodoo' keys to take advantage of it (I've done all of the above and 50 times more). Trading is about identifying patterns and formulating strategies to control risk while taking advantage of them.

Investing is not nearly as complicated as people make it out to be. You want to find companies that return long term value to their shareholders over a time period that fits your goals. Dividends are the most efficient way but if AAPL has a plan and you think they can pull it off, buying it at 81 dollars during the crisis is working out pretty good.

When I traded professionally, I would eat "traders" alive (and whole) who traded off of moving averages and other goofy stuff (there are exceptions that usually encompass other variables like XOM when a large buyer finds the dividend appealing and keeps buying at the same price).

 

[bambbrose]

I was a professional securities trader for several years (still registered etc.) and had some modest success with great consistency. I joined a small consulting firm locally recently to learn some new skills. You can read books and learn a lot about investing/trading. A formal education on how markets work is beneficial. I have one of those 'vast' setups you mentioned with multiple monitors, quad core computer, best internet money can buy, etc. That being said, I haven't made more than a couple trades a month since mid June.

Why?

Knowing when to do nothing is the most difficult lesson to learn in trading. Most people go broke before they reach that level of maturity, regardless of the previous success. Think of all those nasdaq traders and how 99% were blown out as the market rolled over. Think of all those who rode the DOW 14k bull $hit train and didn't get off until it derailed and blew up well under 9k.

I'm sitting on the sidelines collecting dividends (except from BP -_-) and don't see that many great opportunities out there due to the uncertainty marco wise and high valuations of the markets. Be careful.

Thank you both Sahtt and wctsao! And certainly thank you for the words of wisdom!

I need to sit down and think out my investment strategy and separate it from my trading strategy as you mentioned. I think of them as one and the same, as they both lead to the same long term goal of early retirement, but obviously I need to develop a solid retirement plan that includes securities, but also put my extra 10% in a place where I am comfortable calling it trading money and fully aware of the risks involved. I'll continue to learn and hop in fully when I feel comfortable. I've got enough info to last a few months right now, I'll be back with questions along the way:smile:

 

[jond]

Double dip?


.

 

[CL65 Captain]

Double dip?


.

Let's just say, I'm in cash - all of it, until Nov. Almost every major market correction we have ever had has been in March or Oct.

 

[HIJACKER]

Just curious - what is everyone's take on Fannie Mae now, where it was, where it is, and what will most likely happen to the stock in the future? Any possibility that it could recover in 5-10 years or is a dead duck for sure?

What about Citigroup?

I guess my question is - these stocks were once so high and even a marginal rebound would put them back on par. Is it even worth scooping up 1,000 shares or so for dirt cheap just to roll the dice to see what happens? Thoughts from the seasoned experts?

 

[sahtt]

Just curious - what is everyone's take on Fannie Mae now, where it was, where it is, and what will most likely happen to the stock in the future? Any possibility that it could recover in 5-10 years or is a dead duck for sure?

What about Citigroup?

I guess my question is - these stocks were once so high and even a marginal rebound would put them back on par. Is it even worth scooping up 1,000 shares or so for dirt cheap just to roll the dice to see what happens? Thoughts from the seasoned experts?

Vegas has free drinks and will comp your room if you actually win.

If you look in the dumpster (companies beat to $hit), don't be surprised if you find garbage (the firms you mentioned). Sure there are winners here and there, but that doesn't change the fact I'd rather own the casino than play there if total return was my objective.

 

[SilverStone05]

Just curious - what is everyone's take on Fannie Mae now, where it was, where it is, and what will most likely happen to the stock in the future? Any possibility that it could recover in 5-10 years or is a dead duck for sure?

What about Citigroup?

I guess my question is - these stocks were once so high and even a marginal rebound would put them back on par. Is it even worth scooping up 1,000 shares or so for dirt cheap just to roll the dice to see what happens? Thoughts from the seasoned experts?

A little background on Fannie Mae's involvement with Obama's "Making Home Affordable Plan."

Under this program, the lending institution (your bank) isn't required to verify your income, nor will they do an appraisal on your property. They'll just blindingly shoehorn you into a fixed rate 30 year product that Fannie Mae WILL buy from the institution.

So yea, I wouldn't touch them with a 20 foot pole. Regardless of whether or not they are allowed to fail, which the .gov wont' allow, they are also bleeding billions of dollars. I find it hard to believe that anyone would consider investing in this kind of institution.

Citi is a slightyly different story. They've gotten rid of a lot of their toxic assets, and they are working towards becoming profitable again. It will take some time, but they have a MUCH better upside potential than Fannie.

 

[steveny]

Another good month for me. Some stock but mostly option trades. Got put into ED on Friday, sold the 46$ puts after last expiration. Got put into ED at 46 short when the stock was at 47.XX. Woke up this morning stock down 80 cents, woohoo. closed her up. Got a 1.15 for the puts had to give back 50 cents of it. Little bit of anxiety over the weekend but all was good this am. Down on SBUX but sold the CC at 25 so I'm good there. TFSL needs to come back up... short the 12.5 puts for sept and long the 12.5 calls for 2011. Long tivo by being short puts and long calls. pounded some out of SKF, short puts long calls sold CC's on some underlying I bought at 19 and a half. Been a couple good months in a row. Got a long way to go to get back the $ which evaporated though. It's gonna take some time but I get back there.

 

[kookoo4nsx]

Earn 8.2% on your money from Ally bank. Symbol GJM.............but don't quote me on this. :wink:

 

[wctsao]

Thought this may be helpful to those interested in where the market could reverse. The plot is of the DOW Industrial Index. (DJI)

I had to chop off the left to make it fit. As you can see, the top retracement line never got broken so it was only time before it went the other way. We hit the 100% retracement today but given the really bad house numbers and that everyone is saying double dip, then the next line is at 127.2%. Since the housing numbers were even lower than those of 2008, I'm betting we are going to hit the 161.8% line. Just watch for reversals at both points.

Good luck.

 

[onevulture]

Am I the only one on here that got into 3Par when the first takeover offer was on the table? Surely there has to be others....I usually trade on the Toronto exchange but after the 3Par rocket to the moon trade I'm trying to sniff out other takeover potential down south where most of you boys live...any tips guys?

 

[wctsao]

Am I the only one on here that got into 3Par when the first takeover offer was on the table? Surely there has to be others....I usually trade on the Toronto exchange but after the 3Par rocket to the moon trade I'm trying to sniff out other takeover potential down south where most of you boys live...any tips guys?

Congratulations. I missed that one.

Here is a list of potential candidates...

http://seekingalpha.com/article/223255-takeover-fever-update

 

[kookoo4nsx]

On that list Cree and Hog will never happen. Possibly some of the high sales/low market cap will. The problem with some are high debt. You can't LBO a company with too much debt. I'd also look for Niche companies.

The real trick is to keep your finger on the trigger. I do this as my profession.
Keep CNBC tuned in at ALL times in your office if possible. When rumors of a takeover are on the tube you have about 60 seconds to lock in a large trade. 1000 shares or so. Then when the rumor begins to froth. You sell. This worked perfectly when Sanofi bid for genzyme about 4 weeks ago. It initially popped to 56 or so when news broke on cnbc then rose to 70 where it is now.
The key to making money in the market is recognizing a trend and sticking to it until others recognize it. Right now for the last 11 months the trend has been to sell the dow in the high 10's and buy back when it breaks 9999 or so.
I have been using this on CAT and have traded it profitably 4 times selling at 69 or better and buying back at 63.

I bought BP at 31.5 when it seemed nothing more could go wrong. My plan was to hold until they capped. I nearly crapped myself when it touched 27 but I kept my discipline. I sold at 38.5 just as they were showing the pressure gauge holding on cnbc at 3:52 pm. That was a nice 20%.


Also traders should be in cash 50% at least 50% of the time. Decide ahead of time if you want a close stop or if you have conviction to hold through a possible 15-20% drop like I did on BP.

For those that like reading look up on Amazon some old books written in the 70 by Joe Granville.

 

[jonas1jp]

I have been using this on CAT and have traded it profitably 4 times selling at 69 or better and buying back at 63.

You are correct. This has been the case for the last 7 years or so. They have a very predictable trend; perhaps the most predictable I've ever seen. My father worked for them for 30+ years, and this particular stock was the first I traded, and what introduced me to the scene.