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OfflineEnkidu
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Predicting stock prices for trading and reading graphs
    #27112569 - 12/28/20 03:24 PM (3 years, 1 month ago)

Is it as simple as drawing lines for low and highs then taking into account relevant news ?

Am i looking at a 5 day chart to predict a day trade and a month chart to predict a week long hold?


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OfflinegeokillsA
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Re: Predicting stock prices for trading and reading graphs [Re: Enkidu] * 1
    #27112793 - 12/28/20 05:20 PM (3 years, 1 month ago)

You can develop any number of simple or complex trading strategies, most importantly, you need to develop one that suits your style, personal risk tolerance, emotional construct and available time.  There are all sorts of "measured move" price targets for various chart patterns that you can employ to get a general idea of where a stock might be heading.  But in my view, it's best to focus more on your entry (i.e. how much you can lose) rather than how much you might be able to gain.  It's also better to control your risk by using stops to take you out of your trade without you having to make the absolute determination that "this is the place to sell".  That said, if you are up huge on a trade, you should take partial profits to protect yourself from the risk of giving it all back.

Also remember that your first loss is your best loss.  If you've been patient and disciplined in order to get a good entry, you should be able to place a stop nearby to avoid a big loss.  If you really want to buy a stock but you can't find a good entry, you absolutely must adjust your position size in accordance with where a reliable stop can be placed, by determining how much money that stop loss would cause you to lose if it were to be hit.  Obviously, if you buy a stock right at solid support and can reasonably place a stop < 1% below the trade price, you can go in gangbusters.  But if reliable support is 5% or 10% or 15% below where you enter, you better have a much smaller position or else risk having your ass handed to you.

Be a risk manager.  Focus on what you can lose, not what you can gain.  By doing this, you will cut losses quickly and the winners will take care of themselves.  It is not uncommon for me in my day trading account to suffer several small losses, but because the risk is managed, the one big winner I catch that I can let run, more than makes up for the string of losers.  As an analogy, think about the fact that even the best baseball hitters in the world have less than a 50% batting average.  You don't need your trades to all be winners and you can't reasonably expect them to be, especially if you're day trading.  You just need to focus on your entry, manage risk and maintain your discipline.

I know the STOCKS thread is stupid long, but I've outlined a lot of trades in detail, including how I setup my charts and what indicators I use.  In fact, here's a recent one I posted just about a month ago:

Quote:

I am [...] riding a nice day trade on SQ, as it held its opening print even as the market was under pressure (my first buy), and then moved above it's "opening rotation high" aka the first 15 min candle (and where I added to the position), on a successful test of the VWAP aka volume weighted average price during the third 15 min candle, I added a third tranche.  Now the stock is off to all time highs and my position has a stop at breakeven, just below the VWAP, which should hold any subsequent tests today, and if it doesn't, you don't want to be long on a trading position.  You could however hang onto a small piece of this longer term, because it is at all time highs.  Just keep a stop below the daily 8 period EMA and/or the prior day's intraday low.

Here's a visualization of the various metrics I mentioned in my above analysis, and how they applied to my trade today in SQ:


         




While there are key indicators and moving averages across multiple timeframes that you should get comfortable with (because a lot of other traders are, which thereby makes them relevant by virtue of everyone else watching them), ultimately you need to develop your own style for what works.  Short term day trading is not easy.  But it can be rewarding.  Whatever you do, put in the time to learn.  Plan your trades and trade your plan.  Best of luck.


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Edited by geokills (12/28/20 05:30 PM)


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OfflineEnkidu
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Re: Predicting stock prices for trading and reading graphs [Re: geokills]
    #27112849 - 12/28/20 06:20 PM (3 years, 1 month ago)

Geo :kaneclap:

That is solid as fuck

I love the idea of approaching it from the perspective of what can i lose, and thinking risk management first

This is something i think ive heard or read before, maybe by you, maybe a long tine ago, that i definitely will benefit from hearing and keeping it at the forefront of my thoughts on all this

That quote of yours is fucking bad ass. Even if i am looking at the graph pics like :what:

Ill get there

Ill try and work my way through the thread, you have a wealth of knowledge and skill on these things Geo, you're amazing man, appreciate you sharing your wealth

Strive to be on your level one day :hatsoff:


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InvisibleAhab McBathsalts
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Re: Predicting stock prices for trading and reading graphs [Re: Enkidu]
    #27113417 - 12/29/20 02:48 AM (3 years, 1 month ago)




I read this book one time. It's pretty good, but technical analysis has it's own limitations.


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