Chart Watch 2007-01-11

Riversdale Mining Limited (RIV) closed below our set stop loss today. As part of our trading rules we should look to exit tomorrow.

Reconfirmation of the trend if the 3, 5, 8 EMA start to turn upwards over the next coulple of days. If you look close to the end of November this was the case.

Traders with positions should close as per our trading rules. Reconfirmation of trend can signal a new oppotunity of entry and RIV will stay on our watch list.

Eastern Star (ESG) again closed on our stop loss.

Read more...

Joining Trend

I’ve been reading a candlestick trading book and when I reached the end I was extremely disappointed. The book discussed the full range of candlestick formations, and the psychology behind them but it didn’t discuss how to trade the setups. No entry, exit or failure rules were defined.

After coming to this conclusion about the book, I realized this blog has missed an important step on how I trade. I blogged about an entry in ESG that was possible when it bounced above the count back line, but that isn’t a situation I have ever traded or will. The count back line isn’t intended to be traded this way. Trend trading isn’t about picking bottoms. It’s about joining an established trend, or joining an established trend after it has re-confirmed continuation.

Joining an established trend is an easy scan using MarketNinja or most scanning programs. I look for consistent separation of the short and long term Guppy MMA. I then look for an entry with minimal risk, which is close to our count back stop loss and provides me with minimal risk.

Joining an established trend after it has re-confirmed continuation (pullbacks) is about waiting till after the short term group has contracted, and indicators show the 3, 5 and 8 EMA’s are again separating. This provides more confidence that the trend is intact an entry is available at less risk than guessing the trend will continue.

Trend trading is about using our defined indicators to determine entry and exit of all trades. Using each indicator as its intended will provide the most profitable results. I hope to has some examples of each of these setups in coming blogs.

Read more...

Eastern Star, ESG

Late seller closes ESG on our stop loss (0.275), but not below. We also had a intra-day low of 0.27.

Short term trend was broken today, long term still looks intact. If it looks bad tomorrow I'll be looking for an exit.

Read more...

Eastern Star, ESG

Entry opportunity provided today for aggressive traders with ESG falling below our stop loss and rebounding above. 0.285 available at of time of posting. This provides an opportunity with a close below 0.275 as our stop loss.

Read more...

Market Ninja

First screenshot of the work in progress Market Ninja.
The scanner, Market Ninja, is designed for me to easily download EOD data for the ASX and create scans to filter this data. There is still a lot of work to be done before it is ready to be released (freeware), but is currently in a usable state for my purpose.

The idea of the scanner is to load data into columns. This is currently configurable through editing a text file but will be added as a dialog. The current columns supported are only the basics (open, high, low, close, MA, EMA, Volume, Average Volume) with more functions will be added as required. You have an unlimited amount of columns you can create.

Once the columns are defined and loaded, a complex filtering system is available. Greater than, less than, equal to, between, in, not in and many more conditions are available to be applied to a column. This allows you to reduce the data returned by a set criteria without requiring the data to be re-loaded and scanned. This improves speed of changing filter settings over scanning solutions. The filter setup for scan is automatically saved with the scan so it can be re-used next time the application is run.

My aim is to also have available a chart below to the scan results to quickly display the current chart with a few indicators applied. This will speed up my scanning process before investigating the stock further in a more advanced charting application.

Read more...

Sunland Group, SDG

Sunland Group (SDG) closed below our stop loss of $3.53. The rules say exit so out we go tomorrow.

Read more...

Compass Resources, CMR, 2007-01-08

The ascending triangle pattern was broken today with a low of $5.35 reached.

This swing low was equal to the last swing braking the ascending trend line.

It is still interesting to se ehow this plays out.

Read more...

Money Management Calculator

Managing risk is an important step to becoming a successful trader. To help manage risk we need to determine our entry price and stop price. Once these two values are known, we can determine before we enter a trade what risk we are willing to make.

To help calculate my positions, I use a free position size calculator. This calculator allows me to calculate the amount of shares I require to own to risk a set portion of my portfolio value.

Read more...

Stock Wrap Express Charts (SWEC)

Created by Ayamae, Stock Wrap Express Charts (SWEC) is a free charting, scanning and portfolio solution suitable for most traders’ requirements. The functionality provided is comprehensive compared to other solutions available on the internet. Ayamae are very pro-active with bugs and feature request and also maintain a wiki. They seem to understand that providing feedback, good and bad, is the best way to encourage the use of their product.

Charting
Currently supporting 16 exchanges and over 100 Tools and indicators, SWEC provides traders with all the data and features provided by more expensive solutions. I have currently been using the charts created for my blog, as I find them attractive and clear to view. The idea of saving workbook’s of charts is extremely useful when trying to maintain different lists stocks.

A few simple features is still missing, but have been added to the forum as request. These include specifying the color of indicators and applying pre-defined templates to charts. Until these are added, the speed of charting is a bit slow for me as I require sometimes close to 13 indicators to be added to every chart I want to view (mostly moving averages).

Portfolio Management
The portfolio management provides the basics of functionality for this task. I really like the summary page, providing a quick view of each portfolio created with key statistics. The speed of adding past trades to a portfolio are greatly improved over other portfolio management solutions as SWEC automatically fills in the closing price of a stock when selecting a past date.
More reports are required before I will continue to use this as my portfolio management tool. A position size calculator would also be handy.

Scanning Manager
Currently providing 65 customizable scans, SWEC provides the basics scans for a lot of popular trading strategies. Examples include MA cross over, candlestick patterns and a few of J Welles Wilder scans. Pat of the feature requests is a formula creation and back testing. This will greatly improve the solution, providing functionality more expensive solutions are relied upon.

I recommend MarketNinja readers to download a copy of SWEC to determine if the functionality provided will suit their needs. I am going to continue to use SWEC for charting and supporting Ayamae in their products. I currently have no affiliation with Ayamae.

Read more...