Monday, October 13, 2008
Scanning for Possible Shorts Tonight...
Is absolutely nuts! So many run-ups today, but they don't necessarily become an automatic short play for the morning. There are so many stocks that have run-up during today's "record rally." I have found quite a number of possible plays that have finished green today, up 20%, 30%, 40% and even over 50%! If I would have seen these plays a year ago, I would have carelessly shorted into any run-up like a Las Vegas gambler. This is where my patience, discipline, an research comes into play - as I have learned from my great trading teachers. I'll keep scanning for possible plays, but I might just wait until all of the irrational buying euphoria has subsided.
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2 comments:
Hey, so besides the big gains, what are all the other variables that you look at when you're looking for an ideal short? Like what are the main things, and how important is each one? Boillinger bands, type of company (ie real vs crap company..), etc. I ask because I am probably where you were a year ago, just learning. So your input/advice is really helpfull! Thanks
Erich10
erich10...thanks for stopping by! Last April when I first started trading, I did play with the "real" companies - mostly tech stocks such as AAPL, RIMM, GRMN, etc. I did tons of research and the 4K I started with was about 29K by December. I tried using those indicators such as Bollinger Bands, RSI's, MA's, momentum indicators. No matter the research I put in, trading was still very stressful in that those indicators were still not helping out. This past March I learned how to play the short side, but shorting the "real" companies were still kind of hard. So here I am now and I've been pretty successful with my new strategy of finding these huge irrational gains and betting against them. I've also learned to short with fading volume from Muddy and 13th. I also like to watch stocks that are slowly running out of steam after a string of 3 to 5 green days - traders will take profit, especially in today's trading climate. With that said, I don't really use indicators anymore because the Market is greatly influenced greatly by human perception and emotion.
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