One of the great rewards of running a firm like SMB is the friends we have made from others firms. There are some exceptional firms and people in our field. I am certain that in ten years there will be a dozen exceptional intraday trading firms offering enormous value to their traders. Especially since the Buy and Hold strategy has suffered unfortunately of late.

The intraday trading industry still has a few bad actors. But these bad actors will be eliminated as a firm that does not offer value cannot survive. The internet, social networking, the ease of sharing information makes it impossible for such bad actors to thrive. The good firms will share with you teaser content about what they offer in blogs, free videos on their website, etc, such that you will have a feel for the value they can offer. And most importantly, the good firms will work together, sharing trading ideas, to add even more value for their traders, further distancing themselves from the bad actors.

Steve scolds me everyday for giving away too much proprietary information in my posts. My response is usually, “Go back and write another 500,000 shares intraday Mr. Spencer and leave me alone please.” We are not giving away 1/10th of the value we truly offer to our prop desk in this blog (even as amazing as it is of course). And overall SMB has an obligation to the intraday trading industry to show all the good things done and taught at the better intraday firms (no one does this better than @steenbab). The bad actors will make excuses for why they do not maintain excellent blogs or have videos to share. Your choice will be clear.

SMB is good friends with one of the excellent firms in Austin, Texas, Kershner Trading Group. Andy Kershner shared some excellent ideas with me about implementing filters to increase our trading opportunities. Recently one of our bright new traders (maybe not so new anymore especially after yesterday’s personal best), Joe P, built new filters that make the most sense for how we trade. Thank you Mr. Kershner. And in return I stand ready to help their traders if we can.

And last night I received a question from one of their senior traders…..

Hi Mike,

I saw your post on AIG today and had a question: where did you start buying after it held above 25.75 and then after 27.50?

We played it a little differently than you did. We waited for it to establish the 25.75 resistance, watched the consolidation around 25.45, got long there risking about 10 cents (new lows plus a little wiggle room for the few stops that would trigger) and then covered our long after about 25 cents into the new high…..

Bella Response:

This is a great question. And I like your technique. You are buying into the pullbacks. And this is a profitable trading play for a stock like AIG.

There is no one way to trade the AIG set up. When I see this setup I see many different trading plays. An advanced trader will make all the trades. A consistent trader will stick with the plays he is most comfortable with. A new trader should stick with the easiest trades.

But with this set up I see these potential trades: Buying into a Pullback, Momentum Trade, Trade2Hold, Scalp. All of these trades will work, especially since AIG is In Play.

The best thing about your technique above is that you are holding AIG into the new upmove. This is mandatory for Buying into a Pullback. You need to make 80c-$1 on these trades as your win rate will be lower than a scalp or momentum trade.

For us since there was so much volume at 25, since the bullish flag was created at 25.75, since AIG was in play with upside to perhaps the 30’s, we started a Trade2Hold above 25.75. But we also scalped, played the momentum, bought into pullbacks adding lots to our core Trade2Hold. It’s called trading. We use the plays in our quiver to capitalize with this amazing trading opportunity with AIG.

I look forward to working even more with the excellent firms with whom we are friends. We thank them for sharing their trading ideas and experiences with us. And we hope they are enjoying as good of a start to August as we are.

Best of luck with your trading! follow us on Twitter!