My New Trading Plan

Hello and welcome back to my little trading blog. As I said in my last post I have updated my trading plan and hopefully have a new strategy for success. As I have in the past I hope to use this blog to detail my daily trades and ideas and use this space as a detailed trading journal. Of course I hope to also get feedback from all of you out there on my ideas and trades.

So without further ado I present my new plan. This plan is much different than anything I have done in the past and is much more short term in nature than my past strategies. First I continue to get new trade ideas from the top daily percentage gainers and losers in the NASDAQ and NYSE. From these I build a watch list that I monitor on a daily basis. Currently this list contains 38 companies. On a daily basis I monitor these companies and trade on a variety of indicators. Currently I am baseing my trading on mostly technical signals as my trades are short term in nature, consisting of a few days to a few weeks. Currently I try to trade stocks that are at support or resistence and looking to break out. I also look for stocks that are breaking trend lines as well. As verification on these trades I use a combination of MACD, MACD Histogram, RSI, Stochastics, and Moving Average Envelopes.

Once I have selected a stock I only place orders after the market close, this way I take any emotion out of the trade. For this type of trading I place a contingent order to buy just on the other side of the resistance or support, usually try to put it about 4 cents or so over resistance. If in fact the stock moves as I hope my trade will trigger and I will automatically be in the position and hopefully on my way to riches. Once in a trade I place a stop below the average range of the stock to protect myself from any big losses. Once the stock moves up a little I move the stop up to break-even thus protecting myself from loosing any money on the trade. If the stock continues to move up I will continue to move my stop up and locking in more and more gain.

So there you go that is the basics of how I trade. I hope to dedicate at least a post on each key item and give more detail on how I use each indicator. I also will list my watch list and detail every trade I make and why I have made it.

As always please send me any questions or comments you might have on anything I post, I am far from perfect and love to get new ideas. This way we can hopefully all improve our trading and make a little more money!