@Lambrae "
Proudly wearing the blue shirt for this week. Look forward to you tipping again @gamefisherman. I always planned on researching your tips more closely, to get more familiar with the strategy behind your tips, as it was a bit different from the setups that I had been looking for myself. ( You provided so many tips - with a great percentage of winners. What a great resource that was for us.) I am sure plenty of others have missed your tips also. You are one of the posters that I look up to on hotcopper. It is an additional skill , to be able to locate a huge number of runners. Do you use scans, looks for visual patterns at a glance, or just do an enormous amount of research? The person that has probably benefited the most from all your tipping, is no doubt ,you. But we appreciate all your hard work. I look forward to your tips whether they come in the form of - just posting - or in the comp again."
Hi Lambrae, I hope that there is something helpful in the following reply to your post
32063881
What criteria?
Price - usually 1c to $5.00 80% of my trades, 20 % outside those figures
Like to see accumulation happening and much of my learning to discover this has come from Weinstein, Wyckoff, Livermore, Steenbarger
Price trading above the 200SMA usually unless I spot a really good setup, but 80% plus are over the 200SMA
Look for buying pressure, absorption, soaking, accumulation
Look at the relationship between price and volume.
Listen to the market and read the chart. What was the picture that it painted in the past and what is it saying at the present time? The chart is merely a collective mass of the psychology of market participants, so it is crucial imo to have a reasonable handle on chart reading
Dont use chart indicators much, mostly price and volume, and a couple of simple moving averages
Where do I get my leads?
HotCopper STT comp picks each week is my first starting point
STT weekly and weekend posts
Then the green stocks that scroll across the top of the HC homepage and the Top 10 Movers list
Run a couple of scans say a Golden Cross to see if the 50ma has crossed the 200ma which I like, and will often add it to the watchlist at EOD
Talking to a couple of trading mates
Read the Fin Review each morning
Wazzas wraps
Further narrowing down through vetting for failed breaks, lack of conviction from buyers, falling through crucial support zones is an important one for me, both support and resistance zones I am big on, and 90% plus I will always have these plotted on at least one chart for each stock on my watchlist, so I can see how price and volume react around those zones.
Sector Analysis is also important. Once I have done the Sector Analysis which is easy as the STT team are already over it on many occasions, I then look for the strongest stocks from within those groups. Buying the hottest stocks in the hottest sectors can often lead to above average gains. I then narrow down more looking for Strength in their Cash Position, their Management, their Free Float and Top 20, their quarterly's,their Debt, their point of difference, the level of competition, Revenue, Forecasts.....
To be frank I do put in a huge amount of research before I buy a stock that I will be holding for the short term. If I come across a chart that is too good to resist I sometimes will have a crack and by using tight stops, for me this strategy seems to work well. Everyone is different regarding the use of stops. Some traders are all for them and others are at the other end. All that matters is what works for you.
About 2 years ago after a external review of my trading methods and results, it was clear that I needed to improve in quite a few areas of my business. One of the suggested solutions was to move towards following a set of written guidelines that would end up being used as a Template that I could use in the future. It would be this template that I created and improved over time that I now use for all of my stocks that I am interested in buying. I am grateful to a number of people whom helped me create and shape this, and without the STT comp, I do not think that I would have been successful nearly as quick as I would have been if it wasnt for the ability to be held accountable so to speak each week, as results of each comp entry are public and are there for all to see. The STT comp is both a place to grow and learn, but it is also a rich resource full of new ideas and obviously potential stocks that may fit your own set of buying criteria.
Lambrae, I do not think that it is the choosing of a stock that is the hardest part of trading. I think that trade management is where most traders will eventually falter unless they have a strict set of rules to protect themselves from financial ruin that they follow. In the threads we often hear about 1 baggers, 2 bagger, 10 baggers etc. Whilst they happen, for every one 10 bagger result, there is potentially 1,000 other transactions that went by that did not work out. I guess what I am saying is that it is easy to fall in love with the story of large financial rewards from trading. They are obtainable but they need to be properly accounted for in the overall number of other transactions that did not work out as well, so ones own greed does not invade the traders psychology and help to create a FOMO effect that will have disastrous effects at some point in time.
Trade well, be consistent, work hard, be smart, think for yourself, follow your plan, execute your plan and get out of a trade as soon as your own rules tell you to. Let winners run and dont be impatient to lock in gains if the stock is making a slow but steady upward move.
Cheers
GF