Review of Chapter 5 – Shorts and Faders – @investorslive Tandem Trader

Link to notes and review of Chapter 1

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Link to notes and review of Chapter 8

Link to notes and review of Chapter 9

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Summary:

chap5

Another very solid chapter, especially if you are new to shorting or working on identifying low risk short setups this would be VERY useful to you. The late day fade has been my bread and butter for 5+ years so a lot of this was very familiar to me. That being said while I was not glued to my seat during the live trading getting into the setups, I found watching how Nate manages trades while in them, and working with exits very interesting.

I had not realized how patient he was with a lot of these types of trades. When in the chat room or twitter it seems he is moving in and out every minute. But in reality, he is picking areas of support and resistance and managing the trade between them.

I really found a lot of value in Cam’s voiceovers in this chapter as well. He has voiceovers in every chapter, but I really appreciated his input in this segment. Its a good idea to produce it the way Nate and Cam have. You can tell Cam watched the whole thing several times and picked up on ambiguous or unclear moments and interjects very useful input.

I’ve said it several times, but still loving the “risk management” protocols I’m picking up. Again I thought I was very disciplined and explicit in my stops and plan. In reality I was doing a very poor job. But the great thing about this DVD is its helping me spot and fix some of the weakest parts of my game.

Notes:

Chapter 5 – Shorts and Faders

Fader – good way to set risk at HOD

Lot of good examples of paitience
Good voice overs by Cam, lots of value add
VERY useful examples and explanations of “waiting for backside of the move”

-GPRO – intraday para and lated day fade
Need to get a feel for range
bigger range, less size, need to adapt
trading para’s need to cover into any wash

A trade without a plan, isnt a trade at all.

Watch for lower highs for fade, HOD reject

-PBR

You can always get back in a trade, don’t hold bad trades, to much hassle and stress.

Good lesson on not turning winners into losers.

More patience with big daily chart runs, healthy for pullbacks, take advantage of it.

Good real time of LOD – G/R washout – Whole dollar amount – good example of what Nate talks about “Lining up multiple setups”

Whole number washes, great exits.

-ATTBF

Wedbush locate short utility.

Wait for speedups, and thin up on spread.

Good Level 2 example. Bids coming in, and offers moving away.

Only want overextended stocks, not stocks that are just up big.

-ISR – ITCC

Let them run, then put in a lower high. Sets risk for fade. No peak, unlimited and unknown risk.

WAIT FOR BACKSIDE!

Lower highs really bad for OTC’s, good risk/reward on short

So much easier to set risk and size on backside. Frontside may work but its a headache and you will invariably cover emotionally.

If you make a mistake on letting a loss run, always cover into a pullback.

“All that matters at the end of the day is doing the least amount of work for the most amount of money”

-PVCT

Really like Nate speaking outloud the plan, very useful.

WHen unsure, take it off. you control your trades not the market.

-MNKD

Look for big overextended charts

-TWTR

Good HOD reject example.

-WWE

adding into winner

Watchlist 12/9/2014 – $IDRA, $ARRY, $JRJC, $FRAN, $CTIX, $VIMC

Kind of an aggravating day yesterday, shorted $ARRY and $IDRA late day, both pretty mediocre setups. $ARRY, could fade, but I should have covered $IDRA into the last minute spike. I went into both of these with the swing mindset and swing size, but that being said probably should have just skipped them. I did short a VERY solid setup $FRAN, yesterday, but was dicking around with $IDRA and $ARRY so I covered for puny gains, then it cracked late day. I say it all the time, but I need to focus on fewer setups and be patient for them to come to me, if they don’t so be it.

Plan:

IDRA

Pulling back from its aftermarket highs, I should have known something was up what it ran that hard into the close. I chose to hold and there was a PR after hours. By the time I saw it, it had calmed down and quit spiking so I held. I will look to add if it doesnt spike out of the gate. If it gets going again I’ll cover for the loss.

IDRA

ARRY

Looks pretty tired and it did show up on my “red candle floater” scan, I’m basically flat in it right now, not sure if it will be volatile today. So again its a swing, I’ll cover into any washes.

ARRY

JRJC

Skipped this yesterday, was a decent fade after a couple tops in the morning. I’ll look to short if it runs to $9, otherwise will probably just ignore.

JRJC

FRAN

Probably no play here, I’m just watching because I botched it yesterday.

FRAN

CTIX

Hopefully a parabolic out of the gate to set risk against, then I’ll short with HOD as risk.

CTIX

VIMC

Looking for a gap up and fade.

VIMC

Review of Chapter 4 – Parabolic Shorts – @investorslive Tandem Trader

Link to notes and review of Chapter 1

Link to notes and review of Chapter 2

Link to notes and review of Chapter 3

Link to notes and review of Chapter 4

Link to notes and review of Chapter 5

Link to notes and review of Chapter 6

Link to notes and review of Chapter 7

Link to notes and review of Chapter 8

Link to notes and review of Chapter 9

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Summary:

For sure the best lesson in this chapter is how to get and set risk. This was HUGE for me, so often I get into trades and say “I’ll risk X” and X could be 10 cents or 20 cents or a dollar, but often its just a number I pull out of my fucking ass.

This chapter gives real time examples on how to set risk like a fucking professional instead of a piker. Its difficult for me to recount them one by one because there is so much detail (2 hour chapter). But you can see in the notes below what tickers are discussed. Nate walks you through winners as well as a loser. And the entire time talks you through his thinking.

I’m only halfway through, so I may say this more than once, but for sure this is a chapter I will rewatch. If you get and set risk properly with a detailed plan, shorting can be “easy” and stress free. If you jump in and out at random times it can be hard and EXTREMELY stressful (even with winners not just losers). I learned a lot today!

Notes from Chapter 4:

Chapter 4 – Parabolic short

Best lesson, how to set risk on shorts.

Short 1/4 into para move
Add into what “looks like” top
Cover into ANY pullback.
Then start to use HOD as resistance
Lower high with set risk against HOD
Looking for wash through LOD
Short pops as long as previous LOD is upper resistance
Cover into dips

-MBLY
Parabolic, speed up relative to previous price action.
Lots of detailed discussion on how to cover into washout and size back in if it peaks.

-DRL
Thinly traded, “skips up” pre market on light volume
How to create “guide” numbers for risk

Discussion on just closing out vs, holding core and letting it grind back.
Add into whole dollar crack. Good risk to reward on that type of price point.

-PLUG
Look for emotion in gapups/peaks.
How to pick prices for guides.
Good insight into thinking.
Don’t get greedy, take washouts.

-MNGA
Former runner
Good lesson on minimizing profits and holding to long after washout.

-GIGA
use prior day’s highs as para entry.
good discussion of emotions when getting to big
discussion of sizing on thin stocks
Solid explanation of front side of move, and how to scalp there.

-GWPH
Higher priced volatile stocks, move the decimal place, instead of thinking of GWPH as $70-80, think about $7-8

-QIHU
divide price by 10 rule

-GPRO
Grinding in pre market
Good lesson on adding to a loser
How to watch for ABCD when short, GTFO if it is grinding or adjust size

-PTSX
Pump and dump example

Review of Chapter 3 of @investorslive Tandem Trader

Link to notes and review of Chapter 1

Link to notes and review of Chapter 2

Link to notes and review of Chapter 3

Link to notes and review of Chapter 4

Link to notes and review of Chapter 5

Link to notes and review of Chapter 6

Link to notes and review of Chapter 7

Link to notes and review of Chapter 8

Link to notes and review of Chapter 9

PAID AFFILIATE LINK to Tandem Trader DVD

“Learning would be exceedingly laborious, not to mention hazardous, if people had to rely solely on the effects of their own actions to inform them what to do. Fortunately, most human behavior is learned observationally through modeling: from observing others one forms an idea of how new behaviors are performed, and on later occasions this coded information serves as a guide for action.” – Albert Bandura, Social Learning Theory, 1977

Summary:

First chapter seeing the true concept of “Tandem Trader” this is the debut of the realtime sitting in the cockpit with Nate and I found it VERY valuable.

He starts out with the old school classic ABCD setup, and while I have watched Textbook Trading a couple times and the ABCD is discussed there many times. I really got a lot more out of it this time around by watching it real time. Very cool and got me excited for the following chapters with more real time replays.

The rest of the chapter goes into high detail on numerous textbook long (buys) type setups. I won’t go into much detail, you can see quick summaries in my notes below. And there is so much detail and so much info, trying to recount them here would be redundant, you really need to watch them. That being said if you on the fence about purchasing, trust me when I say the lessons are very high quality, and very well structured. This is truly the first time I feel like I’m in a classroom structure seeing trades. As opposed to so many other DVD’s and videos where they are just recapping after the fact with a daily chart.

Still learning more and more about scaling in, I’ve been a member of Investors Underground for jeeze 5-6 years, and I’ve seen Nate’s comments about scaling in and out probably thousands of times. But after seeing it in action I had no idea just how impulsive I was. These early chapters have for sure helped me to realize a HUGE chink in my armor. Seeing Nate trade real time and scale in and handle orders is a hugely valuable lesson. Just finding this problem in my process is worth the price of admission. I sincerely believe if I become better with entries and exits because of these lessons, the DVD could end here and it would be worth the price.

Notes:

Chapter 3 Notes

Nasdaq textbook longs

-ABCD Pattern
-Cool diagram showing the pattern

A – Push
B – pullback
C – Perk off of lows
D – HOD, breakout

Risk on B

Big gap up and pullback, buyers waiting for new breakout after profit takers come in.

Wait for some volume

Description of whole number over and under to set new risk.

If its working, use higher lows as new set risk.

Scale out to help your patience and emotions. Easier to let the trade work after you have booked some profits.

Retest – over – under description, this will happen and is not bad.

Looking for a way to get long, but with a set risk, B of ABCD

GLUU, FB, IDTI, BBRY

Great discussion of forming plans.

I feel I understand “anticipating the move” better with these examples of ABCD.

Less size can be better to allow a trade to work for you.

SSR – buy into washouts/anticipate

-Even in panics, have a plan, for the criteria to match. Get long when others are freaking out.

Risk against LOD once morning shakes out.

-Really like to see how Nate adds in and out, good value in the live trading.

-Morning washout, ABCD

SRPT, SEAS, MOBI, YHOO

How to set risk/find bottoming

Former Runners – MOBI

Size down if plan isnt working, you can always readd if it starts to work, no need to be all in, all the time.

YHOO – Beat chart – weak open – washout

pre market/AH, support and resistance for washouts
-anticipating washout, start in small.

Couple indicators together, R/G, daily breakout, 52 week high, whole number cross etc. Each attracts a different group of buyers.

VII – former runner – float rotation

Final hour, gapper

Want to be contrarian, sell when everyone else wants it, buy when no one wants it. Don’t be part of the herd.

CLF – MTF breakout

ABCD intraday + Daily chart breakout

watch volume with para for exit

Review of Chapter 2 of @investorslive Tandem Trader

Link to notes and review of Chapter 1

Link to notes and review of Chapter 2

Link to notes and review of Chapter 3

Link to notes and review of Chapter 4

Link to notes and review of Chapter 5

Link to notes and review of Chapter 6

Link to notes and review of Chapter 7

Link to notes and review of Chapter 8

Link to notes and review of Chapter 9

PAID AFFILIATE LINK to Tandem Trader DVD

Summary of Chapter 2

Another very solid chapter, still a lot of housekeeping and foundation work but Nate mentions the hardcore trading starts in Chapter 3. Discussion focuses on trading the right stocks with movement and volume. Again this is something I know and practice myself, but a lot of traders get lured into low volume stocks and then can’t figure out how they were right but didn’t make money because of slippage.

timing

More discussion of risk management and scaling in, this I found very valuable, I have a bad habit of going all in on entry, then getting spooked out, even though I am eventually right. Nate preaches going in on your plan, then adding in only when confirmation of your idea is made.

Good real word description of short selling and what setups to focus on when short selling. Also a preview of coming chapters:

Only Short these setups:
– Parabolics – Chapter 4
– Intraday Shorts – Chapter 5
– Faders – Chapter 5

Good description of common IU terms, “Former Runners” and “Float Rotation”, these are both confusing and frequently misunderstood terms. Nate does a solid job of taking the time to explain these terms in detail as well as pulls up numerous past charts to visually represent them as well.

momo

The chapter wraps up with a couple warnings about fighting trends and the danger of following alert services especially in low volume stocks.

Another very solid chapter, lots of preaching about being your own trader and finding what works for you. And yes I used the word “preaching” on purpose (Definition of Preach: earnestly advocate (a belief or course of action). Sooo many traders need this lesson pounded into their heads, and Nate does a solid job of this in this chapter.

Linked at the top are the reviews of the other chapters. Below is my notes, and I’ll be back tomorrow (12/6/2014) with a review and notes from Chapter 3.

Notes:

Trading Concepts

Only trade stocks with volume
Only trade stocks with big daily range 50 cents to dollar. In one day or couple days

Reduce risk with solid support
Focus on stocks that ran in the past

If move works, pay yourself and take some off, reduces risk and stress. Puts money in the bank, then you can let the rest ride.

Short description of short selling
Just because a stock is up big DOES NOT make it a short.

Only Short these setups:
– Parabolics – Chapter 4
– Intraday Shorts – Chapter 5
– Faders – Chapter 5

Focus on overextend charts.

Think about risk to reward, if you want bigger winners you have to be ok with bigger risk.

Description of scaling in, vs going all in.
Add to winners, use house’s money as risk.

Bigger daily range, means more scaling in

Be careful adding if a stock won’t crack support, when it reverses you are more likely to be emotional and cover quickly.

Especially when your shorting, be sure to respect, support and resistance levels.

Be patient and wait for support or resistance to crack before adding.

“Always stick to your plan”

“Stay away from random trades, your results will be random”

Description of former runners and how to remember them
– Big past moves, watch for big volume again, good potential to run again if the volume is there.

Sympathy play – description and themes

Description of recent IPO moves.
-secondary runs

Look for hot sectors/themes

Good description of what a short squeeze is

Float rotation
-description – what the float is
-what rotation is
-more volume = more shares in few hands to little shares in lots of hands
-big spikes on low floats attract a lot of buyers AND shorts, and if it keeps going, only the shorts panic.

Do not fight the trend when float is rotating. Wait for backside and short pops.

“A stock price is just a number in time.”

Have rules and respect the trend.

“Need to be able to anticipate moves and make a plan” for long term success.

Danger of subscription alert services, especially in thin stocks.

Need to find out who you are as a trader.

Recap of Traders4ACause