Followers
Thursday, December 11, 2008
WHY I ONLY TRADE THE OPEN AND THE CLOSE
Here is a perfect example of why i ONLY trade the open and the close. Opening will give lots of imbalances from the breaking over night news or emotions left over from the previous session. The close that's where the PROS are squaring off their positions and that's where you will either see acceleration of trend or a reversal from the previous trend. The rest of the day is just small choppy sideways movement that will just cause headaches and over trading with little gains and probably just losses. This is NOT true for every trading day but a fair amount. Trade the open and the close and look for reversal or acceleration because that IS tradeable, and forget the mid day chop.
peace.
Subscribe to:
Post Comments (Atom)
Blog Archive
-
▼
2008
(607)
-
▼
December
(30)
- Dinosaur Trader's Best Post of 2008 By Bloggers
- HAPPY HOLIDAYS AND MERRY CHRSITMAS EVERYONE!!!!!!
- SNOWED IN!!!!!
- Bo Yoder Newsletter: His Thoughts Align With Mine ...
- Put/Call Hinting At Comfort From The Bulls
- Rising Wedge Update
- Possible Rising Wedge
- CF breakout
- 60 Min nasdaq and Spx Charts
- FCX Setup: Request For Darwin
- Stocks With High MoMo
- Bo Yoder Newsletter
- Semis Stocks Setting Up Nicely: Courtesy Of Leavit...
- Freakin Chopfest! This Market IS A PIG!
- WHY I ONLY TRADE THE OPEN AND THE CLOSE
- My PnL Excel Sheet
- My Excel Sheet: PnL Log: DISCIPLINE IS VITAL!
- SRS and SKF: Breaking Falling Wedges With Volume
- Rising Wedge Updates
- THANK YOU ALL from the bottom of my HEART!!!
- Stocks To Watch Today
- More Upside For Indexes: Inverses Setting Up In Be...
- OIH: Still Stuck In A Channel
- VIX Still Consolidating
- Oh Boy! Could It Be True
- MACD Divergence To Spot Nice Long Swing Trades
- Rookies Looking To Short
- Bo Yoder Newsletter
- Two Great Setups Courtesy Of Sloth
- Charts Of Interest For Next Week
-
▼
December
(30)
Cool Traders/Sites
- ART OF TRADING Premium Site
- Charting Trends blog
- Denarii
- Finance Trends bog
- It's Gold
- Keep Unread Blog
- LaserTrader
- momentum trader
- My Trader Interview
- Mystic Stocks
- NYC Trader
- Rant About It Blog
- stock rook goes pro
- Stock Virtual
- StockPursuit.com
- The Market Guardian
- thecrosshairstrader
- Todds Trade
- trader market blog
- Trader9999 blog
- Trading Momentum blog
- Trading With Average Jay
- Wall Street Warrior
10 comments:
Hi. Yes midday chop is the much, though there was a great entry midday for a decent and predictable run at the 11:30 candle after that reversal candle.. But I agree with you for the most part on the general trend..
I do however like when there is midday low, but steady move.. That hasn't been the norm lately.
-sloth
Good advice.
Stewie,
I agree that lately, the first and final hour are where the big moves are. A while ago though, the first hour had a lot of chop, and then a strong tend would emerge, and at the end of the day that trend would reverse or taper off. So things seem to shift subtly over time, sometimes.
Also - why do some people call the first hour amateur hour, and say to stay away from it?
momo: amatuer hour would be the best hour you would think, NO? think about it, amatuer hours would be full of mistakes to take advantage of. so, take advatage of amatuer hour by doing the opposite and ride the coattails of the pros later.... fantastic!
People come home after work and place their bets for the next day.
Officially it's called amateur hour because retail trades, often market orders, are filled at the open.
The market makers who fill those orders set the opening price. They have a fuller picture and will gap price to cover their order book while creating a liquid market.
Another aspect of the open are specialists who use this opportunity to start filling their book for the day. They often have limited time to push millions of shares.
The close is where funds will often clear their order book and bank intraday differences.
Then there's dark pools...
A ton of positioning and agenda gets worked out in very short periods. That's what I heard anyway.
but how do you know whether it's gonna go up or down during the first half hour?
Stewie..came across your blog via Wall St Warrior. Great blog! I have added you to my blog list over at tradingstockz.blogspot.com You make the difficult seem that much easier. Keep it up! Justin (A fellow Pacific Northwester, I grew up in Seattle)
gtm: excellent explanation. thnks dude.
welcome justin!!
anon: that's the tricky part and where having a game plan ready is helpful. for example: i am looking for this news driven day, mostly very bad news, i think the mrkt will likely stay down all day. i will be looking for an oversold bounce off the open and then will try and position some shorts.
Hey Stewie, a trading course, and mentoring program by you would be a great idea. I agree, the opening and close, are good for momentum and less games are played. If you look at SRS yesterday, it just sort of went up the whole day, how would you play that?
Hey Stewie!
Glad to have you back!
Post a Comment