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Rank: Advanced Member
Joined: 8/14/2008
Posts: 315
Location: Memphis
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I've got a new favorite way to Day Trade as of today!...
I've been following the posts of a few members of this Forum regarding 2X ETF's, and this weekend I spent quite a bit of time studying up on them. From now on, I plan to trade nothing else but SSO. It's the Ultra S&P500 ProShares on the Long side, but it can also be Shorted just like any stock can.
This ETF can really MOVE!!!...
Because it moves so fast, I'm only going to use the one minute chart for my entry and exit, using my usual five minute chart strategy. The Technical Indicators on the fifteen minute chart can give a good indication about what's going to happen next. The CCI on the fifteen minute chart actually gave a Buy Signal fifteen minutes before this big UP move happened. I'll be using the five minute chart for chart patterns and support and resistance levels too.
Here's my first Day Trade on SSO today. I bought 1000 shares at $24.75 because it was at the lower BBand, Stochastics did a nice V-bottom and the fast line crossed back up through the slow line, and the CCI crossed down through the lower horizontal line and then moved back up through it.
I sold at $25.65 because the CCI crossed back down through the upper horizontal line, Stochastics lost support at the 80+ line, and the PPS closed below the 5MA.
This trade took just over 15 minutes to net me almost $900.
I THINK I'M IN LOVE!...LOL
Happy Trading,
zz
 www.stock-market-lessons.com
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Rank: Advanced Member
Joined: 6/15/2008
Posts: 240
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ZZ,
Welcome to the world of etf's. Now you can see the potential to make money. Others should study because in a down market, you can buy bear's and hold for nice gains as long as you tolerate the volatility. Start with small dollars until you get the hang of it.
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Rank: Newbie
Joined: 11/10/2008
Posts: 7
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ZZ You the man!! Thanks and please keep them coming. Your presentations are great. Now I just need some discipline. 
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Rank: Advanced Member
Joined: 10/24/2008
Posts: 52
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zzman.....I thought you would like it. Don't forget QLD and QID....same methods apply.
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Rank: Newbie
Joined: 11/22/2008
Posts: 3
Location: NC
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ZZ and others.....Do any of you guys use options for day trading or scalping?
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Rank: Advanced Member
Joined: 8/14/2008
Posts: 315
Location: Memphis
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southbound wrote:ZZ and others.....Do any of you guys use options for day trading or scalping? Welcome! to Finviz.com 'southbound'...
In my fifteen year trading career, I have ONLY traded stocks on either the Short side or the Long side.
I've never traded Options, and know absolutely nothing about them.
I have just been introduced to the 2X and 3X ETF's by members of this forum, and have just recently begun trading them. I like them much better than trading regular stocks, because they mirror the movements of the Index they are tied to and they move really, really fast and give better returns than stocks. I plan to Day Trade the 2X ETF's only for the foreseeable future.
If you are interested in Options, a friend of mine on another website's forum has said this is a good site to begin learning all about them:
http://www.888options.com/strategy
And you can open a "practice" trading account and trade them using "play" money at these sites until you're sure you'll be successful:
http://www.e-opts.com/
http://www.888options.com
http://www.pfgbest.com/simulated_trading/
https://www.optionshouse.com/home/signup/
Good Luck!...and Happy Trading,
zz
www.stock-market-lessons.com
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Rank: Advanced Member
Joined: 8/14/2008
Posts: 315
Location: Memphis
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I only had time for two quick Day Trades today because I have a house full of relatives.
I made about $200. on each of them, and they both happened in less than an hour:
Happy Trading,
zz
www.stock-market-lessons.com
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Rank: Advanced Member
Joined: 8/14/2008
Posts: 315
Location: Memphis
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I didn't trade today because we are traveling, but this pattern hasn't happened much during this Bear market...
This is called the "March of the Bulls", and also known as "Stair Stepping UP". This is a very bullish chart pattern, where it moves up a lot, pulls back a bit, and then moves up again over and over. The pattern somewhat resembles a stair case. You don't see this pattern very often, but when you recognize it happening it's usually a good idea to stay in the trade to see how far it will go.
It's a healthy way to make a Bull move that isn't too steep, and has periodic pullbacks which is good because no chart can go straight up without falling just as hard. See the example of the "Blast off, then Crash" pattern at the bottom of this post.
Being the unrepentant Scalper that I am, I probably would have bought and sold TSO three times today on this run and made less than if I had stayed in for five hours. For those of you looking for a way to stay in Day Trades for an hour or longer, this lesson is a good one for you...
SSO's five minute chart looks very similar to the one below, but the Indicators are a bit more erratic so I used a TSO chart to give a better picture of what I'm trying to explain here. SSO moved up three dollars in five hours, so either one would have been a great play for today.
The most important thing to watch is the CCI in this case. As long as the CCI keeps bouncing up off the zero line, you can stay in the trade. The second most important thing is Stochastics bouncing up off the 50 line. The second time Stochastics broke down towards the 50 line it broke below it just a bit which is kind of scary. But the CCI was in great shape at that time, so there was nothing to worry about. 1000 shares bought at $7.30 five hours later sold at $8.20 for a gain of ninety cents, or $900.00!
Here's a better look at the 5MA (white) and 15MA (red) without all of the other Technical Indicators.
I've changed their colors from my normal ones so that you can see them better.
Can you see that the PPS never closed below the 15MA, and the 5MA never crossed down through the 15MA? Since neither happened there was no reason to Sell until just before the closing bell, because it was Friday and Day Traders never hold over the weekend or overnight.
An example of the "Blast off, and Crash" pattern. It's very unhealthy not to have numerous pullbacks during a strong rally, because when it starts falling there are no levels of support to help hold it up. It goes up vertically eighty cents without one red candlestick, and falls just as hard and fast as it went up:
Happy Trading,
zz
www.stock-market-lessons.com
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Rank: Newbie
Joined: 11/10/2008
Posts: 7
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ZZ, Thank you for all your great TA posts.
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Rank: Newbie
Joined: 7/30/2008
Posts: 3
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ZZ
I just started trading this year. I would like to thank you for all of your posts. I find them very informative and have learned a lot, particularly, in the areas of chart patterns and technical analysis. As I look back at my success and failures I can clearly see how I could of minimized or avoided pain and also maximized my profits by following your advice. Specifically looking for buying signals of 1) PPS is at the lower Bollinger Band,2) when Stochastics is very over sold, 3) RSI between 30 & 40 and turning up, 4) CCI crossed below the -200 and crossed back through it. Then look to sell when the PPS hits the upper Bollinger Band.
Have you, or anyone else, found a good way to screen for the aforementioned ?
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