Thursday, April 16, 2009

Minor Trade Results Change

Immediately after I posted the exit recommendation yesterday for QID the market made a mini upward explosion. My inkling of that possibility was part of what prompted me to suggest getting out right away. The result of that fast rally was that it would have been nearly impossible for anyone to get out of the trade at the price I posted as the exit price yesterday. I already moved that listed exit price down a bit yesterday, but I am going to move it down a little more to more accurately reflect the actual price any blog followers woulda coulda exited at. So, I will move the exit price to 42.50 which is the midrange price from the high to low of the last hour yesterday after I posted. I have reflected this in the "closed trades" list on the blog, which now shows a 2.19% loss as opposed to a 1% loss.

For future reference, any part time traders, etc. who cannot or did not exit a trade during the day if that was my suggestion, I always suggest just placing a market order for the next morning to sell at the open. In the current market environment this will often result in getting out at a significantly different price than the posted blog exit due to high volatility and large average gap sizes. Obviously the results could benefit or hurt the results, but I am assuming that over the long run it will kind of average out if you just place a market order to sell the next morning in those cases.

In recent months I have tried to use limit orders as much as possible to avoid this issue. Also, I have tried if possible to make any recommendation changes around the ET lunch hour as that is typically the most stable price period of the market day and any one who is limited to their lunch break for making intraday order changes can hopefully check the blog and make the change during that time.

So any regular blog readers/traders just keep this post in mind if a similar situation comes up in the future. As a last note regarding this QID trade, for anyone that did not exit the trade already, exit today as late in the day as possible, as today has the looks so far of a close near the lower end of the day's range, but I don't have a crystal ball to know for sure.



  1. you are always quite fair in the actual buy/sell price recommendations in your blog. very cool sir. i was able to get out of qid in a small surge past 43.50. and now very glad to be out today.

  2. glad you got out in timely fashion. It looks like you pretty well nailed the high of the day in QID. Did you target the gap fill from last Thursday?

    I had considered using that gap fill as a limit order for the exit, but I opted to place a protective stop and wait for an exit signal from the model.

    These top picking trades end up negative more often than trend catching trades, but as in the big trade on QLD after the March bottom, the initial moves can be very strong at major highs and lows which I think makes up for a little higher failure rate.


  3. no, no, sorry. my mistake. when you said high of the day, i knew i didn't get that, so i looked back at the trade. within the last 30 minutes, it was at just under 42.5 (two, NOT three), it looked like it might have a small push left in it before the end of the day based on the 3 min chart, so i put in a stop at 42.70 and caught it.

    i'm not nearly as sophisticated and experienced of a trader as you; just a jr level trend trader, while holding down a 9-5, and trying to learn a little more each day.

  4. keep it up b,

    there are many successful trading methods out there, but consistency and mastery of one method is all that is needed to do well. Then the ability to recognize minor adaptations and time frame changes as market conditions change will let you continue to "improve" your methodology.

    Trading is not that difficult really when you break it down, but the discipline and personal development needed for the retail individual trader to succeed are "difficult". At least that is my experience.

    Take care