LVS has been on SMB’s radar for the past couple of weeks. It made a nice run from 15 to 20. Yesterday, it showed signs that it was going to give back some of its recent gains. It sold off hard from 20 to 18.50. Gman, our head trader, was short it for most of the afternoon. He identified some … Read More
Should I be Short or Long?
If a stock has fresh news prior to the market Open it may gap up/down a large amount from the previous day’s closing price. My first instinct as a trader is to be long stocks that gap up on news and short stocks that gap down on news. My experience tells me that the majority of the time there is … Read More
Anticipating The Change
In September and October of 2008 the young traders on our desk put up ridiculous numbers. Their aggressive instincts were rewarded by the unusual level of volatility. But then their aggressive instincts were severely punished in the months that followed. They were slow to adapt to changing market conditions. By December of 2008 it no longer made sense to make … Read More
Our Approach Makes the Most Sense (Really)
When I began trading in 1996 we identified the stocks we were going to trade from something called the “ticker”. This window that appeared on our trading platform identified stocks that were moving. We were taught to get long stocks that were going up and short stocks that were going down. We were momentum traders with state of the art … Read More
The Pattern
As traders we are always looking for patterns. If we can spot a trading pattern that repeats itself (at least for awhile) we have an edge. When people hear the word “pattern” they usually think of a visual pattern. For traders this would typically be represented as a particular chart pattern. For those of us who read the tape it … Read More
Flexing My Brain
During our AM Meeting the other day I suggested that FAST might be setting up for a nice down move. The stock was gapping down in the premarket on earnings–albeit on light volume. It had runup on Friday so I thought a bunch of traders were caught leaning the wrong way and would panic out below 30. Right on the … Read More
So What Now?
The SPYs finally closed below 88.50. This is the lowest close since the gap day on May 4th. Many people are talking about how the daily chart for the SPYs look like a head and shoulders with a neckline at 88. There will be many obsessively on tv talking about how “technically” we look like we are going to trade … Read More
Know Your Edge(s) and Thanks Joe P
The market has slowed down quite a bit recently. Unless you are trading the most In Play stocks there is virtually no follow through. At times like this it is even more important to refocus on your trading edge. For myself I have identified four things that have allowed me to make money consistently over the years. 1) Previous day’s … Read More