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Vince's Trading Journal - Advice Needed!

Discussion in 'Trade Journals' started by VinceField, Oct 20, 2020.

  1. VinceField

    VinceField Member

    Joined:
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    Messages:
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    November 13, 2020
    1 winner, 4 losers

    Today's notes:
    Don't enter overextended
    Enter full position when entering after pullback
    Stick to stop loss
    Don't average down

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  2. VinceField

    VinceField Member

    Joined:
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    I've decided that I need to step up my analysis game. In addition to reviewing all of my trades, I'm going to analyze every trade opportunity for the stocks I traded for the entire day. I think this will help me learn and identify high probability patterns. I'll be posting this extra analysis here in my journal.
     
  3. VinceField

    VinceField Member

    Joined:
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    Messages:
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    November 16, 2020
    5 winner, 4 losers

    Today's notes:
    Improve scale in strategy.
    Improve stop loss strategy.

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  4. VinceField

    VinceField Member

    Joined:
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    November 17, 2020
    4 winner, 3 losers

    I entered two trades about an hour before market close on two stocks that had a long steady uptrend. Almost as soon as I entered the trades the uptrend lost momentum and the trades went against me. This can be seen in the last two charts below. Is it common for uptrends to lose steam like this towards the end of the day?

    Today's notes:
    Set stop loss
    Improve scale in strategy.
    Don't enter with strong downward MA Resistance on multiple time frames
    Be careful trend chasing at end of day?

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  5. VinceField

    VinceField Member

    Joined:
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    Messages:
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    November 18, 2020
    2 winner, 3 losers, 1 breakeven

    Today's note:
    Be careful with overhead MA resistance

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  6. VinceField

    VinceField Member

    Joined:
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    Messages:
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    November 19, 2020
    1 winner, 6 losers

    Today I seemed to arrive late to the party in almost every trade.

    Today's notes:
    Be careful entering when slow stochastic is overbought?
    Failed 2nd breakout from flat top rising wedge (bearish indication?)
    5 EMA pullbacks before entrance (exhausted?)

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  7. Eric Gonzalez-Germann

    Joined:
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    I have a few suggestions to help you out.

    How to determine if a stock is in a bullish or bearish trend: Use the 200 sma on the day charge. Look to see if its above the price or below the price on the chart. If the 200sma is above the price on the day chart, then its in a bearish trend. If the 200sma is below the day chart price, then its bullish. If the 200 is squiggling around during sideways action then the day charge is probably consolidating in a channel.

    If you want to invest long term in a bullish trend. I would look for the 200sma to start approaching the stock price while its consolidating. The 200 will be hovering just above the price and will look like its about to cross it. Keep those on your watch list. I would start buying piece of your position with multiple buys. The first one will be a test to see how its moving. And I would add as you feel more confident. Usually when the 200sma crosses under the price, there will be a huge spike in price...Sometimes it will come back down to touch the 200sma to continue back up. What I would look for before the 200sma cross on the day chart...is to look for a 50sma cross on the a day chart to happen before or at the same time as the 200sma is crossing. Another thing to look for is for the 200sma to cross below the 50sma on the day chart. That's called a golden cross. I would keep holding until that happens because it can go even higher. Especially if the stock is hot and has lots of volume during these crosses.

    Another thing I need to add. My favorite time frame to make entries with is the 4hr chart. I look for the 50sma to cross through the 8ema on the 4hr chart. This is one of the most high probable trades I like. The move can be pretty significant.

    In case you haven't noticed, my trading style is using cross signals. And after practicing them so much, I've learned a lot of nuances of my style. I basically looked at all of the biggest moves and looked how how my indicators looked before and after the moves happened. With thinkorswim, I can actually use their OnDemand feature that will let me watch the day of the move in real time since its records the market everyday. Anyways, I really started my journey to make my own strategy was to study all of the biggest moves and figure out what to look for before it happens. My breakthrough happened when I added the 50sma to my 8ema, 13ema and 20sma that were already on my chart. I used those to indicate the short term bull and bearish cross signals. But when I added the 50sma and looked at all the biggest moves...I noticed that the 50sma cross would always be there. But some crosses can be failures but if I look for the right probabilities, the trade I would selectively choose would more than likely be a winner. I figure out how to stack the odds in my favor and how to setup my risk vs reward. I would use just below the 50sma as my risk with a stop loss. From what I noticed...all my best trades I back tested on paper....That the price never came back down below the 50sma when it truly was a winner. But that isn't always 100% sometimes it will come back and dip below before it makes the big move. Which is why I like to average in my position with multiple buys. I would make have 3 to 4 buys to get my full position before a move. Add 1/4 of the position to test it would and get your mind in the game. Then when you wait for a bit or see that its acting how you want it. add more....and when its just about to rip and you know it from experience... add the full position...setup your stop and hang tight. Look at the day, 4hr, 1hr and 30m chart to figure how your profit target. Find the resistance levels. See if there is a big probability by looking at the volume and what kind of cross just happened...which time frame? Was it a day chart, 4hr or 1hr chart cross? What is the most logical resistance level to sell for a profit? is there a lot of buzz about this stock? Can hold my trade for a few hours? or for a few minutes? You'll have many questions to answer to your self in a short period of time to setup your plan. It takes a lot of practice to trade the same type of trade over and over again. To be consistent you consistently take the same type of trades over and over again. If you veer off and start making trade with no strategy then your probability of winning goes down by a lot. Another thing, I would suggest focusing on the Day, 4hr, 1hr and 30 minute only. I would use the 1 or 5 minute charge that much. The thing you want to understand is that the higher the time frame is, the more weight its movement has. So a 4hr chart has more weight in telling the story vs a 1minute charge and 5 minute chart. What if you didn't know you were in a bearish trend with the 4hr chart? And what if you see a bull signal on the 1 min or 5 minute chart...you trade it and come to find out, it was a false bull move and continues to go lower? Stay away from that move if you are a bull. Wait for a bull cross signal to happen on the 4hr chart. Then your probability of making a bull trade goes up by a lot...and now you can use the 1 and 5 minute chart to help with your entries after confirming your higher time frames are bullish. The can also be done shorting. Just reverse everything I said. It works both ways. A stock will act differently when its in a bullish or bearish trend when you confirm with the 200sma. There is a lot more I can add...like how I use the stochasticfast and MACD along with the cross signals. But I'm not looking to write a book on here lol.


    Below are some notes of the indicators I use. These are just to show you what I look at. Maybe this information will help you, maybe it wont. But I enjoyed writing this.


    Fast Moving Averages (When the 8ema above the 13ema and 20sma the stock is bullish. I look for these cross from bearish to bullish.)

    · 8 EMA (Yellow)

    · 13 EMA (White)

    · 20 SMA (Green)


    Slow Moving Averages (I use these for buy cross signals as then approach the 8ema. These moving averages can also be used for areas of support from buy from.)

    · 50 SMA (Light Blue)

    · 144 SMA (Orange)

    · 200 SMA (Red)


    StochasticFast – I used this to know if the stock is in over bought or oversold conditions.

    MACD – I look for this to go from red to green. I also use this to gauge the momentum of the stock.


    Time Frames I Focus on

    · 1hr

    · 4hr

    · Day

    · Week

    · Month

    Definitions

    EMA – Exponential Moving Average - An exponential moving average (EMA) is a type of moving average (MA) that places a greater weight and significance on the most recent data points. The exponential moving average is also referred to as the exponentially weighted moving average.

    SMA – Simple Moving Average - A simple moving average (SMA) is an arithmetic moving average calculated by adding recent prices and then dividing that by the number of time periods in the calculation average. ... Short-term averages respond quickly to changes in the price of the underlying, while long-term averages are slower to react.

    Stochastic – By comparing current price to the range over time, the stochastic oscillator reflects the consistency with which price closes near its recent high or low. The stochastic oscillator is range-bound, meaning it is always between 0 and 100. This makes it a useful indicator of overbought and oversold conditions.

    MACD - Moving Average Convergence Divergence (MACD) is a trend-following momentum indicator that shows the relationship between two moving averages of a security's price. ... Traders may buy the security when the MACD crosses above its signal line and sell - or short - the security when the MACD crosses below the signal line.



    How to analyze a stock


    1.) Identify if the stock is in a bullish or bearish trend.

    · Use the Day Chart time frame and check if the 200 SMA above or below the stock price.

    · If its below the stock price, it’s in a bullish trend.

    · If its above the stock price, its in a bearish trend.

    · The further away the 200 SMA is from the stock price, the stronger the trend is.

    2.) Identify if the stock is a about to have a trend change.

    · The closer the 200 SMA is to the price, the higher the probability that there will be a trend change if it looks like it might cross below or above the price in the near future.

    · Bullish Trend Change - If you see that the 200 SMA is hovering over the stock price and it appears that it could cross the 8ema soon, this is a good time to start accumulating a position. If you see that the 50sma and 144sma have already crossed below the price and the 200SMA is now approaching a probable cross through the 8ema, this has potential for a high probability trend change. This is the time to start accumulating.

    · Bearish Trend Change – If you see that the 200 SMA is hovering below the stock price and it appears that it could cross the 8ema soon, this could be a potential time to start accumulating a short position. Or to know you need to stay away form the stock if you are a bull. If you see that the 50sma and 144sma have already crossed above the price and the 200SMA is now approaching a probable cross through the 8ema, this has potential for a high probability trend change for a bearish trend.

    · If you see this type of setup, put it on your watch list and wait for a signal to start accumulating a position for the trend change. I usually use the 4hr charge to look for the 50 sma to start doing a probable cross to enter into the trade.


    3.) What to look for if there isn’t a probably 200sma trend change cross signal.

    · If you do not see a probably trend trade setup, you may look for a potential swing trade or day trade setup.

    · If you are looking to buy after identifying a stock is in a bullish trend. You will want to look for a high probable setup. Look at the day chart stochastic to see if the day charge is oversold and consolidating. If you see that these two things, next, look to see if its consolidating at a support level. Then see if the price is touching the 50sma, 144 or 200sma. If you see these things happening, start looking at the 4hr chart for an entry. The best time to enter into the trade is to wait for the 4hr 50sma to start creeping down towards the stock price for a probably bull cross. If you see the 50sma on the 4hr above to start crossing the 8ema start buying. This is a great time to get into the trade. If you see lots of volume pick up during the probably cross this is a good indication that it can go up fairly quickly. You may also use the 1hr chart help you time your 4hr cross setup. If you see the 1hr cross under the price already or is going to cross at the same time as the 4hr chart…this is a good sign that the trade will work in your favor.
     
    VinceField likes this.

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