I plan on starting an open comment section and possibly a trader’s forum on the site soon but until those features are rolled out, I like to pass along some of the replies to questions received via the contact form (located under the resources tab). Here are a few good questions, along with my reply that others might find useful.
Q: Anyway just to make things clear. Your post about the IWM(or TWM) compared to the most recent one(spy,qqq,iwm). In the TWM(iwm short) you mentioned this to be an aggressive one:
A: Yes, because I shorted IWM/long TWM/TZA while it was still very much inside the pattern AND the current short-term trend in IWM was bullish, those two factors make it an aggressive trade compared to how many traders will trade, which is; 1) to wait for a breakout of the technical pattern/support/resistance that you are watching for the buy/sell signal and 2) most traders seem to prefer trading in line with the current trend while my style very often entails anticipating & positioning just ahead of trend reversals.
Q: And the short QQQ post of today you are waiting the macd to cross the zero line. Sometimes if I am correct you are not waiting this to happen:
A: As far as the IWM & QQQ shorts, as well as many other past trade ideas on the site, I personally trade different time frames & also try to post the most significant & timely developments that I see on the charts, regardless of the time frame. The traders that follow the site, including my own trading style, range from very short-term (often in & out of a position the same day) all the way out to long-term investors or trend traders looking to position for a large move that may last many months or even a year or more.
For example, the most recent QQQ swing trade, which is still an Active Trade entered on March 18th at 107.91, still looks fine & remains profitable at this time. The next downside target remains 100.09 or the daily uptrend line and the suggested stop for that trade remains 111. Typical swing traders need not be overly concerned with the 15 minute charts that I have been actively posting lately but active traders might find these charts useful for short-term trading, especially leveraged vehicles like TQQQ & SQQQ (3x long & short QQQ etfs), QQQ puts & calls, or the $NDX e-mini futures (NQ).
Personally, I will often “micro-manage” a swing trade by closing or reducing my position as support/resistance levels are hit and/or very short-term buy/sell signals are triggered. When micro-managing a swing trade, I might also reverse the trade at these levels (i.e.- go from long-to-short or short-to-long, just to play a quick bounce & then re-position back into the direction of the swing trade for the next swing target).
I realize that’s beyond the abilities or desire for many traders and with the primary focus of this site being swing trading, again those who do not have the time, experience or inclination to try to game every little micro-swing on a trade should mainly focus on the 60 minute & daily time frame analysis. However, the shorter-term intraday chart analysis (e.g.- 15 & 30 minute) may also be useful for those conventional swing traders that might have either missed or passed on the original short entry, but would like to be short the Q’s now, but prefer to wait for an objective entry -OR- a swing trader that might have only taken a partial position on the original short entry & would like to strategically add to their position.
As in your question, yes, if & when the QQQ triggers all three short-term sell signals on that 15 minute chart posted earlier, especially if the SPY, MDY & IWM have also confirmed via the same sell signals, that would be about as an objective short entry or add-on as one could ask for IMO. The more buy or sell signals to confirm a trade, the better chance of success it has. Add to that, when trading any one broad market index (e.g.- QQQ), I will also keep an eye on the other major indices (SPY, MDY, IWM). For example, if you shorted the QQQ on a break of support while the SPY, MDY & IWM were all sitting just above support at the time and they all ended up bouncing off their support levels, the QQQ breakdown will almost certainly prove to be a whipsaw signal as the broad markets largely move in tandem.
Q: Is there a difference in position sizing when not waiting(so when it is an aggressive one)? Or do do only put on so much aggressive trades compared to normal style in your portfolio?
A: Yes, typically I will use a smaller or fractional position on aggressive or anticipatory trades, usually adding to the position once/if the trade plays out in the expected direction, such as a breakout of a wedge pattern following a partial position that I established within the wedge, as the case in yesterday’s IWM short.
Q: I notice that (well it looks like) you pay much more attention to index, currency, well the big stuff and before more to individual stocks. Is that because there is much more going on right now like the eur/usd is very volatile and maybe a turning point in the major indices?
A: Trading individual stocks are my preference and where I tend to excel. You are right, normally I am trading & posting many more individual stock setups than the broad market tracking etfs. However, for the past couple of months, I have been extremely pre-occupied working on programming changes to the site. I don’t use stock scans or screeners, instead I usually go through dozens if not hundreds of charts each day looking for the most promising trade ideas. With my limited time lately, I’ve largely focused my efforts on the broad markets & certain sectors such as precious metals, energy, currencies, etc.. However, I’ve started to budget some time to get back to posting individual stock trade ideas lately and will continue to do so going forward.