Stocks, Trade Management and Records
Every trading day, well before the pre market session opens, we tweet through http://stocktwits.com/GemsBot, the most reputable trading site, to https://twitter.com/GemsBot our watch lists for the current day. Each list consists of six volatile US stocks for Long or Short intra day trading, but the trades may develop into swing positions, if successful, by using our recommended and well tried out strict Trade Management. Out objective in picking the stocks is for most if not all on them to print a 1% gain the day they are published. As you can see from the tables here below in the column with the Max P this is achieved frequently, compensating for the losing trades and then leaving a lot more.
The Trade Management we use is based on entering with 3 lots at the open of RTH, lets say that 1 lot is 100 shares or any number of shares according to your own account size and profile. A stop loss for all 3 lots is placed at 2% net loss. Profit targets are set for the 1st lot at 1% net gain, for the 2nd lot at 2% net gain while for the 3rd lot no profit target is set. When the 2nd lot takes the profits, then the stop loss for the 3rd lot is set at net breakeven and we are left with a zero risk runner. The runner can be closed with a minimum of 3% profit or it can be trailed with 2% spread.
We repeat that the selections are posted before the pre market session opens, so certainly there are more criteria that can enhance your trading results, like on obviously directional days to decide on how many long or short trades to take, but they are beyond the scope of this blog which is to provide simple and profitable ways to get you started and then moving on to more advanced trading systems, using our Indicators.
Having said the above, we do use our Gem Directional Indicator (GDI) as a guide on the ratio of long or short trades that we take. You will find the current value of GDI and instructions on how we use it on our page http://bit.ly/GemDirectionalIndicator
Remember that trading is a statistical game and having a profitable and sustainable method is the only way to keep increasing your trading profits. At the end of each trading day we post the performance of the stocks from the Open, which we use as a reference point. You are most welcomed to see any stock chart live together with me, where you will see how simple and effective they are. Just Skype me. Alternatively you may get all our indicators installed on your computer and watch them live for 10 days by paying us a nominal fee of just $1 USD.
Non Farm Payroll day and markets jolted from ECB rate cut. Day to go fishing or golfing. Have a nice w/e.
Since I started posting my 12 picks every day in StockTwits, I have discussed with many traders about my methodology, which is based on the strict trade management mentioned at the top of this page.
I am surprised with how many traders ignore the fact that there are many ways to skin a cat, and many want to apply their own methodology to someone else’s picks.
A typical successful short trade occurred today, September 30, 2013 with the stock MY, despite the fact at one time it was more than 25% up during the trading day. That’s because it moved south first, within 10 minutes from the open producing more than 4% profit on the downside.
The chart above and the table on top of it have all the details of the trade.
Each day the list shows the performance of 6 stocks Short and 6 stocks Longs in my Watch Lists, as posted in StockTwits. There is a typo in the pictures here below that the second 6 stocks are described as being in the “Longs” list while they were in the “Shorts” list. This of course is apparent if you visit my StockTwits page and will be correct from now on.