2015 Action Plan

I am working hard to let the following conditionals guide my daytrading:

When it comes to going long—

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Basic mechanical framework for deliberate alpha capture (versus acting spontaneously)
1) Market open at least 10mins, with minimum 20mins left in the session
2) No longs if SPY is red by more than one percent
3) Relative volume: run rate minimum 5% greater than SPY.. stocks w/ light volume = no trade
4) Stock is trading up between 1% & 10%
5) Average daily volume no less than 300k
6) No market order until at least 10mins on watch.. avoid impulsivity
7) No limit order until at least 5mins on watch.. never buy tips or scan hits w/ immediacy
8) Stop loss must be determined prior to inserting buy order & is not to be more than 2 tics below 15min 20sma
9) Place stop loss in order book immediately following entry

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Mandatory moving average locations (adherence to which prohibits counter trend trading)
10) Price above daily 8sma
11) Price above hourly 8sma
12) 15min 8sma positioned above 20sma
13) Seek to execute near rising 15min 8sma with stop below 20sma

Overheated indicators (fools rush in)
14) Price must not be near or above daily upper bollinger band = froth, too overbought*
15) Price must not be near or above hourly upper bollinger band = relax, wait for 15min pullback to 8sma*

*exception: allow for entry above upper bollinger bands when they’re contracting, especially after prolonged pinch, or even when they just begin to expand.. but after multiple bars & cycle of volatility, banging on upper bollinger band —avoid setup.. sheep chase / too late

And then conversely, when shorting—

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Basic mechanical framework for deliberate beta capture (versus acting spontaneously)
1) Market open at least 10mins, with no fewer than 20mins remaining in the session
2) No shorts until SPY trades below open for at least 15mins
3) Relative volume: run rate minimum 5% greater than SPY.. stocks w/ light volume = no trade
4) Stock is trading down between one half & 5%
5) Average daily volume no less than 300k
6) No market order until at least 10mins on watch, avoid impulsivity
7) No limit order until at least 5mins on watch, never buy tips or scan hits w/ immediacy
8) Stop loss must be determined prior to inserting short order & shall not be more than 2 tics above 15min 20sma
9) Place stop loss in order book immediately following entry (never more than 1%, lessen size if necessary)

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Mandatory moving average locations (adherence to which prohibits counter trend trading)
10) Price below daily 8sma
11) Price below hourly 8sma
12) 15min 8sma positioned below 20sma
13) Seek to execute near declining 15min 8sma with stop above 20sma

Overheated indicators (fools rush in)
14) Price must not be near or below daily lower bollinger band = blood = too oversold*
15) Price must not be near or below 15min lower bollinger band = relax, wait for relief rally

*exception: allow for entry below lower bollinger bands when they’re contracting, especially after prolonged pinch, or even when they just begin to expand.. but after multiple bars & cycle of volatility, banging on lower bollinger band —avoid setup.. sheep chase / too late

**rules are subject to change, but only after the market has closed

2015-01-11_1950

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8 Responses to 2015 Action Plan

  1. hamidesna says:

    Hi , The post has fantastic impression, It is straight forward and to the point.
    I would like to know how do you scan the stocks and what is your time frame , though it seems your trading time frame is hourly. Tnx again for sharing

    • chartseer says:

      Hello and thank you for your comment. I am presently scanning for weak & strong daily charts, and then I drill down to the smaller time frames in seek of additional data that fits my criteria. The hourly is important, but mostly I am acting on 15min chart, with a goal to get half of my position out the door at a profit preferably under an hour. I may then hold the 2nd half longer, depending on the chart’s progress. I intend to try TradeIdeas.com for custom intraday scans, but have not yet had time to learn their interface. I know a lot of folks also like TradeStation. That seems good for end of day scans, but does not look quite as dynamic intraday.

      • hamidesna says:

        I am using TC2000 platinum version, and it works well, though is cost a bit. So when you say no long when SPY is down 1% , do you look at daily chart ? On the other hand you don’t go long if today is more than 1% down?
        and what do you mean by Stock trading up between 1% & 10%?
        Finally I didn’t get what is you target price , for the 1st half?
        Thanks

      • chartseer says:

        When the loss for the SPY on any given day is over 1%, I will avoid long setups. Put another way, if the market is bloody, do not buy. Wait until the next day when maybe it is up. Also, when I decide to go long, I want to find a stock that is up between 1% & 10% for the day. I don’t want to buy a red stock, or a stock that is already up dramatically. Lastly, I do not have a SPY target for the 1st half of the year, but things are looking bearish right now, and it appears lower prices are forthcoming.

  2. Ed says:

    Great post! I use a lot of the same basic trading rules. I have only been trading part time for a year and only trade long setups, but I have a goal to begin shorting this year. I am actually studying shorting stocks now. I trade off of basic technical indicators but do not use any studies on my charts. Do you feel that using studies help your entries and exits? I have been contemplating learning how to use the studies on my charts. Thanks

    • chartseer says:

      Hi Ed, I don’t use studies all that often, except for moving averages & bollinger bands..all the various oscillators just tend to confuse me..shoot for simplicity imo

  3. Heather Allan says:

    Hi. Just wanted to say how much I’m liking your 2015 Action Plan. I’ve been using it this week. I’m not a day trader, but a short term swing trader using options.

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