Trading Questions

I often get asked when I tell people I am a trader is wow how exciting so you are a daytrader? Daytrading and/or day trader got known variety back in the 1999 internet timelime. Daytrading was something done back then just like in recent years people would acclaimed themselves professional flippers/ investors in the housing market. I am not a day trader I always reply I am an active trader. None of my fellow trading colleagues would consider themselves day traders no matter which instrument they trade but we will all admit be are active traders and very often yes we are in and out of a trade in a couple seconds to minutes but we dont only trade intraday.
Market conditions usually stipulates what we do in terms of trade duration, size and profit targets. We as trader often have knowledge of trading multiple instruments but usually focus only on our individual strengths when markets are in our ideal environment.
Most of the time I trade stocks ranging from intra day trades to multi day swing trades. When the market is not stock friendly I switch over to Futures intra day trading. Right now I am studying forex which is very very dangerous territory for most trades. Forex is highly leveraged so a high leverage of risk reward should be taken.
I will tell readers this, actively trading most of the times is not about how much money you can make but preserving capital and over the years I have implemented a risk reward system which has worked great for me and I will share it will you.

Here it goes.

I based all my trades on risk and reward but no trade should cost me more than 1-2% of my portfolio. Therefore if you are 200k trading you should not lose more than 1-2k on that single trade. I will show an example: Say I am looking at RIMM chart and I see it is forming a bull flag, so I want to jump on this is what I do. I analyze the bull flag and note where the stop should be on a failure of the flag. Analysis tells me entry on the bull flag is 105 and bottom of the flag is $102, so I therefore need a $3 stop. If I am using a $3 stop I therefore can only trade maximum up to 660 shares based on a 200k portfolio with maximum 1-2% loss per trade. Playing like this will ensure you will not get blown out on any one trade. I must never never lose more than 2% on a trade.
I hear many traders losing 30% of their port in a day because they go all in on one trade and then they are wrong. It is very sad but it happens every single day.
Human beings are naturally driven by greed but we must learn how to control it. If you are a active trader set a target whether it be daily, weekly or monthly on your portfolio. Since I do this professional as an career I personally have daily target and weekly targets. Many times I achieve my daily target in the first 5 minutes of trading and then I go into profit protection mode (this is where I scale my loss parameter to .05% instead of the 1-2% per trade). If I have 3 straight losses for the day I call it quits for the day.
I am just sharing some of the things which are beneficial to my trading and want to share them with all.

Yahoo Update

Rolled out of the April calls today in the May $27.50 calls @$2.00

SKF

Buying some SKF here for the long haul. @ $100.40

Simply Amazing

How can you buy a stock with no earnings. Citibank is been bidding up pre market after they posted a bigger than expected loss. Can these eople add or subtract. Oh well maybe they can and I am wrong since they earns millions while making their clients lose.
Watch for the ags and oil stock here carefully, if and I say 'IF' market believes financials and tech have bottomed then there will be rotation out of the Oil and agro stocks which have been on fire.

Stay nimple here and play option if you can so you have a defined risk.

Yahoo calls I will be rolling out of the April $25 at basically even at the open and purchasing the May $25 as I still believe Microsoft will pay up for Yahoo. The thing with these plays you have to be patient.

HIGHER HERE

Well as I been saying I expect a bounce as we are in Earnings seasons and now we will get it for sure. This morning we have overnight earnings from Google for the tech and for this motning we have Caterpillar which also beat along with Honeywell. Even expect the laggards as financial to at least get a bounce into the brokers earnings next week. Yes yes yes you will here everyone say the bottom is in etc but it is just a bounce here because of earnings. Lets see how far this bounce takes us and I will be looking at some laggards to play long.

GOOGLEISHOUS

Wow a blow out for Google. This will definitely give the market the lift it needs to get going as I told you. IBM didn't really do it for us today but GOOGLE I am 100% sure with option expiration tomorrow should be a great day. Today was fun all my daytrades scored as targeted and that reinforces what I said last night that the days after trend days are usually great trading days.
I expect us to keep the bullish bias till earnings are over, after that who knows but I will be short the heck out of this run up after earnings and into any kind of technical resistance.
Today should be great day to trade look for GOOG, BIDU, YHOO, and the Brokers for the first hour's high to go long.

If it was always this easy

Wow days after trend days are always very profitable for me, can't get any easier than these days.
Sweet sweet sweet. I hope you longs are ok today because all my money today I made on the short. Who knows where this market really goes and who cares aslong as you make money up and down I surely don't!!!!!
Apple looks week here but since tomorrow is option expiration more than likely the crooks will pin it tomorrow @$150 or $155. Tonight I will be watching GOOGLE earnings. I am like a kid in a candy store for that one tonight.

Yahoo deal seem like it is a dud for the options I have for tomorrow but it was 100% risk, good that I purchased in the money options so at least the are worth something.