When does it stop

[legion3pm]

When does it stop going down and rebound back a little bit?

[The Little Giants]

I would summize that we will probably bounce at some point tommorrow. I'd like to see us open down. I am currently researching a lot of tech with the intention of doing a lot of daytrading tomorrow or the next day.

[Goods]

Stops when the bears get full and the bulls get hungry again.

With the market as volatile as it is, no one wants to hang on overnight, knowing they can wake up to a fat loss in the morning. Right now we have record oil prices, a war, billions in bad loans, a weak government, weak dollar and an election year coming up with the front runner being a ballbusting woman. Nothing stable about that.

Just the same as we can get a 300 point drop, some good news can trip a 300 point gain the next day. Great for daytraders.

In case anyone missed it, ORCL came out to say they have virualization software 3x faster than VMW and their giving it away for free. Hence, the VMW and EMC meltdown today and the NAZ collapse. Doesn't mean it'll put VMW out of business but people run with any bad news in markets like this.

[The Little Giants]

Great day today! Holding several long tech daytrades. We could see a few day's worth of a bounce, but I intend on cashing in on these profits today. I may hold 1 or 2 of my positions for a swing trade, but I'm leaning against it, we'll see how we close.

[legion3pm]

great call on seein a good bounce today

[The Little Giants]

Thanks! I wish I would have entered my positions yesterday, unfortunately most of these stocks gapped up along with the market, but I did buy some QQQ calls before the close last night and those have performed quite well.

[The Little Giants]

I had daytraded RIMM, AAPL, and VMW calls today. They all performed great, I sold them all except for some of my VMW calls. I kept 10 for tomorrow. I had QQQ cals and sold 75% of them, I'll see if they can get any follow thru. I daytraded C and sold it entirely. I added a few more calls to my NEM position as well. Great day! Not much to do in terms of research after a day like this. We just have to see what tomorrow holds. I'll do an hour or two tonight of some chart work, but for now I'm going out for a nice dinner. Good luck!

[legion3pm]

gratz on a good day LG

just a question. when you buy calls lets say a two dollar call now that is really costing you $200 dollars right?? or if you sell it before the expiration date do you only have to pay the two dollars that you paid for it? just trying to learn a little more

[The Little Giants]

I sold my VMW calls and QQQ calls on this gap up.

[The Little Giants]

Legion, think of it as a stock where each contract represents 100 shares. So yes, a $2 call would cost $200. Therefore, if you sold it at $5.25 you would make $325 off that call. You definitely want to buy an options book and do your homework before trying options though. They are very dangerous and you can lose your shirt fast if you don't know what you are doing.

[legion3pm]

another little pullback today. i watched the market all day and it seemed pretty stable so i bought 50 shares of RIMM at $115 stupid move on my part but i cant seem to figure out when to buy into stock. then the selloff before the close didnt help any. looks like thats how its gonna be like you said GOODS no one wants to hold on overnight. well im gonna hold on to mine i guess and see if it gets another pop up tomorrow. these volatile stocks are killin me.

[Goods]

RIMM's not a bad bet. But definitely one of this stocks that live and die with the market flow.

Before buying something, you should decide what type of trade it's going to be. Daytrades should have tight stops whereas if you're looking at the 6 month chart for longer hold, a good stop might be the 50 sma. But that allows for 10 more points of hurt.

Have a stop prepared for where you can't take any more pain. (like I didn't on AAPL the other day and ate $1500 :P ) It's much easier to put in a stop order and let it hit than to just tell yourself you'll cut it off if it gets there.

[legion3pm]

as always great advice GOODS. yeah i should have set a stop but i left and didnt think the market was gonna tumble like it did. with stocks that do like to move a lot like RIMM VMW DRYS BIDU POT is there anything you look for that particular day or do you just stay away from them and find a better stock to invest into?

[Goods]

Honestly, I'm still an amateur compared to some of these guys so don't take my advice as set in stone.

Lately, I've just been using the MACD and Volume indicators along with the charts. Love the MACD. If the market's moving sharp up or down, it's a pretty easy bet to buy or short a VMW, etc. But if you don't get in early, don't bother until the next chance. There's always a next chance. And if not, you didn't lose a dime by staying out.
A ton of my losses early were from chasing. Something would go up strong and I'd buy the tail end, afraid I was missing it. Boom, crash down and I'd panic and sell. Probably did that 100 times. The pros have many thousands of my hard earned crack selling dollars.

I'll watch something going sideways for a while and look for a breakout. Nice volume spike with the price moving out of the past range. Not foolproof but it's usually followed by more of the same. Or when a price is going steady one way while the indicators are doing the opposite, it's probably ready for a reversal.

You can almost always catch something on the open going up or down heavy. You might be able to latch on quickly but the better bet is to watch for the bounce. If something drops 5 points at the open, it might bounce back 2,3,4 points. Chances are if it doesn't make it all the way back, it's ready to fall again. Again, nothing's a given. Pays to trade with whatever way the market's going - only short if the market's getting killed, only buy if the market's moving up. With VMW, if it takes a dive, I'll click over to EMC. If that hasn't fallen yet, it likely will. Those charts are nearly identical being the same company.

Mostly, it's a eye you develop to know when to jump in and get out. I still make new and improved dumb mistakes all the time but I'm getting better. If you haven't gotten books yet, get some today!

Hope this helps.

[legion3pm]

Im doing the exact same thing you used to do GOODS im buying at the tail end and then selling when it crashes down. I'd like to hope the money that im losing is making me learn a lesson but i wonder sometimes if it is. Anyway i went ahead and ordered Technical Analysis of the Financial Markets by John Murphy that you recommended. If you were doing the same thing that i am doing now i figured id give this book a shot.