We have lots of experienced traders on MoneyAM who would be glad to help if you have any trading questions.

Zoltar - risk/reward is part of money management.

A lot of traders use their stop loss and target (via support and resistance) to determine a) whether the trade is worthwhile and b) how to size their position.

Re: your second point, what constitutes broken resistance/support? This is part of understanding support and resistance.

For example, an indecisive intraday break of support is often a day traders amber light for a long and a position traders green light for a long. Only a decisive break signals the short.

A position trader will want to see a *close* below support followed by an open below support and a falling intraday price to signal a decisive break - so what if he misses the first 2 or 3p? He's unlikely to be whipsawed as described above.

A daytrader will check the strength of the buy side on L2 before making a call. If there's strength below the current price he'll go long looking for an intraday return back through support and a move towards a close above support. He's looking for the whipsaw as a chance to scalp a few.

Gausie

Gausie
trying to track you down to find an answer. what did you do to upset that old goat OLDOLIE?

Didn't know I'd upset him.

But I wasn't too happy when he made threats of physical violence to a friend of mine.

His recent posts show him to be a skilled trader with a valid and interesting point of view. I guess back then he was finding his feet and possibly felt he had something to prove.

Strange chap. But water under the bridge as far as I'm concerned.

A few questions related to CFD/sb spreads...also the term 'nibbling'

Take BT for example...


BT SET PRICE shows:180.5-181 What is your definition of nibbling, my understanding would be to Buy (or go long CFD spread given maybe 181/181.5, sell at 186 or around that mark...? i.e for small gains and keep buying as the price rises...(or falls, then u go short...nibbling)

For most tight spreaded FTSE stocks what would you say is correct/fair quote for (BT as example again) CFD spread given by Broker, using example above, would be a 'quarter' or 'half' point above quoted SETS price? I presume it would be a quarter, of course If I am not happy with spread I can just say..No..

I find nibbling risk high at this stage of trading, just my opinion, I know traders do that all the time, some very very successfully I might add, need to gain a lot more experience to do that kind of trading consistently...but I am learning, and want to be confident that the trade I make is my best...by that I mean at least a higher % of success, than failure..

I suppose CFD's can work out very well if u are looking for 3-10%+, going short/long on larger more liquid stocks, say FTSE 100 and some some 250 stocks.

Many Thanks always...

Jules99.

ta Gausie
was reading a thread about this site on adfn,which has been frozen, he slagged you off big time.
now trashing threads esp tad fbb.

tx for reply

oooer! whats the url?

Zoltar Have a look at the chart on th Traders Thread as a good example
Micro trends during the day do break to often and are not worth trading. But the longer term are very reliable as can be seen in the chart.
What do you think?
D.

Jules99
BT is a tracker and so has a very strong correlation to the daily movements of the FTSE
If you go long BT the majority of the time you are going long on the UK market.
If you trade a few times a day have a look at GNI where you can trade either side of the order book
This means if BT is 185 Bid 186.5 offer you can place an order to buy at the 185 or sell at 186.5p.
Effectively being in profit as soon as your order is filled less your dealings costs. This can be a big advantage!
D.

Could anyone guide me to a readable source for option trading and where is perhaps the better traders to deal with or website? thx

Gausie
thought id saved it but now missing.
it was a thread about MAM.
will persevere
rod

Welcome to the LSE Casino All!!!

Sod The Data and all that!!

From a Day Traders point of view BTW!!

:-)

Jeff

Thanks for that Croc...

p.s I heard or read Barclays do CFD's too now...Can anyone confirm and is the service any good?


Ta.
Jules99.

TTT

Gausie/Croc.
Great stuff on this thread.
One thing which I think I asked wrong before; How is the best way to tell if the market is trending or in a trading range? Does it even matter? If you have correctly identified support, and your exit point is close, you should still be able to put the trade on. However, if a stock has fallen to support because the trend is down the trade should not be taken, but if it has fallen because we are range bound, it should be.
Also, and this could be a big topic, how can a small guy using a home PC with sharescope EOD hope to develop and back test a system? If, like me, you still have to do that old fashioned thing called 'work', you are not likely to have an army of subordinates to write tailor made software and spend thousands of man hours in system development. Any back testing the small guy does is likely to be of too small a size to be complete, as the data sample will often all be within a bull or bear run. Also, it will contain plenty of errors, omit times when signals are generated and then quickly nullified, and could even be based on erroneous assumptions and principles. Without being able to test lots of data the small guy's 'system' is surely doomed before the first trade is made. Tight money management and all the discipline in the world won't help you if your trading system is flawed.
Thanks Guys
ZOLTAR

Zoltar
I believe you can backtest your TA trading ideas with Updata
http://www.updata.co.uk/TA/simulator&Community.asp
D.

Curses! I thought the Crocodile had asked a question. I was all set to give him an answer ;-)

Croc: A few days ago I noticed some really dopey sales on DYS. Five trades adding up to about 90 shares in total. Is it possible they were testing a BOT which they switched on yesterday? The sales yesterday and today are suspiciously similar in size and timing. But a BOT on a SEAQ stock?

vasey
It is indeed very unusual but not impossible. Did the share price move in the that direction in the days following?
D.