Tricks of the successful trade : entry, exit, price, position size, risk , upside and strategies

[hanera]

@pandeyathotmail

Please reply in the tricks thread: how to not catch a falling knife?

You catch a falling knife only if you are bullish about a stock in a bull market.

Ideally, you want a bullish divergence e.g. price with RSI or stochastic, oversold, and touching support such as horizontal, trend line, popular SMAs/EMAs e.g. 50-day, 200-day, 13-week.

[pandeyathotmail]

This is counter-intuitive. I though you catch falling knife when prices are falling under illusion that prices are low.

@hanera

Ideally, you want a bullish divergence e.g. price with RSI or stochastic, oversold, and touching support such as horizontal, trend line, popular SMAs/EMAs e.g. 50-day, 200-day, 13-week.

What does the above line mean? What do you want bullish divergence for? For a falling knife to happen ? Or you want to buy during bullish divergence? What is bullish divergence? When prices are moving upwards while the indicators are bearish?

[hanera]

Rare ideal set up.

[pandeyathotmail]

@hanera

When a trader buys a call, the dealer who sells it will typically buy a certain amount of stock in the underlying to offset their exposure. If the shares continue to rise, dynamically managing that hedge can entail increasing purchases.

@pandeyathotmail Something for you. You may want to search the web to get more details how the market maker hedges their position when somebody trade an option. It has impact on share price. This option thingy is a complex mechanism and full of info, you may need to go to school to learn, ToS offers courses on option free for account holders. If you are good at maths and derivatives, it plays with those If you understand it well, can make huge fortune with a small initial capital. I use to know a blogger who make $30-$50M with only few thousand dollars trading AAPL calls during the heyday of AAPL (from iPod launch till around 2013, after that he quitted to do other stuffs, didn’t hear from him again). Is not a BS, he showed me his trading records. Btw, I knew more people went broke trading options though.

Long call = Long underlying + Short put is the most important formula

@manch

I have long concluded I don’t understand Tesla, and likely will never do. Kudos to people who understand it and have the conviction to put their money on the line.

The problem with you, you think like an academic. You should behave like a cultist. Just believe in Elon Musk! Elon is a genius. Nobody is as godly and well liked as him after SJ is not around.

Thanks. I am cross-posting in the tricks thread

[hanera]

@pandeyathotmail

@hanera and @caiguycaiguy how do you come up with selling decisions as you did in case of SQ. Why did you not keep it holding? Why do you think it is peaking out? I think the question becomes what distinguishes a hold stock from sell stock? Please reply in the tricks thread so that it is easy to go back to for reference on a later day.

Cut n paste from the same thread of your question Completion of intermediate degree wave i soon, assuming it is not an extended wave (refer to EWT, can web search). The price is fairly close to previous high of $82-$83. Traders tend to sell near round numbers of course, sometimes undershoot, sometimes overshoot, a little. I have a few position, close SQ so I can spend more time on VEEV and TWLO. Missing a few dollars is ok in the grand scheme of thing.

I am holding SQ in a trading account, obviously I trade Seriously, I don’t have enough money to hold stocks. The only buy n hold equities I have are AAPL and S&P index fund Thought I said many times For buy n hold, I don’t monitor price charts, care more about leadership, business model/ strategy and competitive environment (esp moats). Btw, I like Jeff Lawson CEO TWLO better than Jack CEO SQ.

Edit:
IMHO, TWLO and SPLK are buy n hold candidates as their tech can be “infrastructure” for others apps as such could be around for a long time. SQ has tons of competitors, WS favors PYPL. However, I sense Jack is ambitious, he has big vision, so if you are willing to bet on him, is ok to buy n hold and hopefully one day can enjoy the big Tesla moment.

[pandeyathotmail]

I am glad i sold SQ yesterday following your advice. But, I held on to PAYC and sold at 3% loss this morning. I gained overall 10 % on the trade. I wish I could get better in planning exists. I could have kept more.

[hanera]

@pandeyathotmail

A few days ago I sold my positions in DXCM. Today DCXM bumped up by 12.5 . I feel so upset. What can I do to avoid this kind of stupido selling?

DXCM is clearly in an up trend.

[hanera]

@pandeyathotmail

In last few months, I have picked up some chart reading tricks. How to do it for long term? What indicators.

Use weekly chart for position trading (daily chart for swing trading),

[hanera]

Technical analysis isn’t necessarily about the pattern itself, it’s about the psychology of what’s going on within the pattern.

At any point of time, we have investors and traders buying and selling so the pattern is a composite pattern (guess you have learned signal processing). Ideally we want to isolate the pattern for each group of investors/traders, in practice, technicians use moving averages. Longer time frame MAs for investors’ psychology, shorter time frame for traders’ psychology.

[Jil]

For further deep reading here you go

The Kelly Criterion: You Don’t Know the Half of It

[hanera]

In a raging bull market, any long strategy will work. Blindly buy work too - proven by my mad money portfolio - no FA, no TA, no analysis, pick based on many articles on them. We only know when the tide subsides which strategy actually work. Btw, definition of work is? Better than S&P?