Review of Trading Tickers – Chapter 3 – Basics to My Trading Strategies by @kroyrunner89

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Link to Table of Contents Post

Summary:

chapter3

Another solid chapter on the basics. Good coverage of candles vs line charts, how to gauge support and resistance and risk. The risk management was very useful to me. While I keep my risk very tight I did appreciate Tim’s “method” of sizing. I “kind of” did it already but I for sure learned from his more mathematical approach of lining up support and resistance on the chart with a set dollar amount to risk. Then sizing based on that.

This risk management discussion was worth the hour spent viewing this chapter.

Risk

After that some good lessons on how to use and interpret fundamentals and a TON of content on reading Level 2 for OTC’s. Tim did a good job with the Level2 illustrations, but I’ll admit I got a little bored. I seldom trade OTC’s so it was not terribly useful to me. Plus he reinforced my view that Level2 is “almost” worthless on listed stocks. Since I normally trade listed stocks I don’t follow Level 2 like a hawk. I for sure do watch it, but take it with a grain of salt. Once OTC’s come back in vogue I think I would be more interested in this content.

A solid chapter and my favorite so far, starting to get into more intermediate to advanced topics so there is more value for me. Not trying to constantly repeat, but if you are a new trader, lots and lots of good stuff here.

Notes:

Technical analysis basics
     Candle vs Line charts
          -Basics of how to read candles-
          -Good illustration of lines vs candles
     Basic support and resistance are best, not a bunch of indicators
     Trading decisions off of chart – usually daily
     Support and resistance discussion
          -Channels
Volatility is KEY
     -Volatility and volume vary by day, only trade the volatile and liquid stocks
     -No trade in sideways action
How to judge risk
     -Use chart to guide risk instead of % or dollar amounts
     -Refuses to let money shake him, use chart instead
     -How far from risk are you? Size based on risk.
     -Good discussion on sizing based on risk.
     -Do the math based on risking dollar amount. – I LIKE THIS IDEA
               -risk on chart X max dollar loss
Fundamentals do not matter
     -EXCEPT you need to know earnings dates/calendar events etc
     -Dont trade earnings and news in advance
Trade setups, find via daily chart
     -use daily support and resistance levels to find entries
OTC’s
     -Best to assume they are all scams
     -Level 2 can be useful on OTC’s
     -OTC’s are not as tradable as they used to be.
Listed stocks
     -Sell spikes,buy dips – whether long or short
     -Level 2 not as useful use the chart more
Level 2
     -Basic rundown of a level 2 Montage
     -Times and sales
     -Good discussion of hidden size and soaking.
     -Realtime illustration of an OTC panic on level2
     -Good to watch videos on Level 2
     -Record realtime on OTC’s of panics and spikes
     -Lots of OTC examples
     -Comparison to listed stock – NDRM
     -Level 2 on listed moves so fast.
     -DAS tweaks for L2 for 200 shares

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