daytrade diaries....tuesday

Morning all

I had a surprise yesterday. I rediscovered that stocks sometimes do put on big one day gains, even in this market. And I'm not talking about speccie stocks. I'm talking about proper stocks like MGR, which I scalp traded yesterday using my intraday 'gap' method, only to watch it break out and run shortly after I sold.

It's not that I was unaware of the potential break either – I even posted that it was looking strong. It's just that the bearishness of this market has permeated my mindset, and my trade yesterday was a perfect example of how I traded what I felt, rather than what I saw.

It's probably best not to make a habit of that.

The other issue that I gave some more thought to last night, was the issue of timing. As a swing trader, if you mistime an entry by a day or two, it's no big deal. As long as the chart setup is still intact, and your stops aren't hit, then the best course of action is to just wait.

Not so with daytrading. Last Thursday I had a trade in FMG which went nowhere. On Friday I got distracted with other trades and by Monday I had almost forgotten FMG.

Well the shorters hadn't forgotten it was time to cover their positions yesterday and FMG put on a classic short covering rally (well done Kevi) . I'm going to have to be more diligent with setting breakout price alerts on heavily shorted stocks like FMG in case I'm looking elsewhere when the shorts cover.

Today I am also going to try a simple intraday scanning idea to see if I can be in the right place before potential moves happen. I've set up a simple Stochastic scan with price and volume parameters to filter out low volume and speccie stocks. I'm planning on running the scan every hour or so to see what it throws up and I will elaborate once I have some results.

Last night the scan yielded AAX CGF CXC GWT and RIV so we'll see how they go.

For stocks in oversold territory I ran a Bollinger scan and found these : APN BJT CDU CSR and QAN. They may still have further to fall.

In the meantime if anyone has some relevant scans to share that will put me in the 'go' zone, I'm all ears.

Finally, I usually kick off this thread around 8am when the US market closes but if anyone else would like to get it going any time before that, then please don't wait for me and just go for it.

Good trading.