The working person’s trading method detailed. Part 4 An Overview of my Process.

Process Overview

In this post I will give another overview of my trading methodology. I already did this in the first post, but I get into some more detail here. As a result some of this is a repeat. I apologize for this, but it does help to reinforce the previous information.

Daily

Every day I run the Stockbee Episodic Pivots scan. I run this in FINVIZ and Telechart. I go through and write down any stocks that I think warrant further research. On very rare occasions I will put a stock directly on my watch list. On even more rare occasions I will consider buying the stock ASAP. This is ultra rare. I compile the stocks that were written down into a list that I then go through again during the weekend. Here I will pare this list down and only add the very best to my watch list.

Also, on a daily basis, I will monitor my current holdings. I do not enter my stops into my broker, rather I have a system for managing my stops manually. My profit targets are entered into my broker, so they trigger automatically. Though my system is fairly mechanical I do allow myself some discretion. If a stock is very near a profit area, but can’t seem to get there I will fudge a bit. The same with stops, though with stops it is a bit more complicated.

Weekends

weekend warrior overview

On the weekends I run several scans to look for stocks to add to my watch list. Every other week I go to the NextBigTrade Stage Analysis Screener to look for candidates. Also Bi-Weekly I run Trend Scan abs(c>avgc70)*125 in Telechart. This is a persistent trend scan to find stocks that are in very persistent trends. Every week I run the following scans:

  • Landry Bowtie Crossover (C > AVGC10 AND C10 < AVGC10.10) AND (AVGC10.10 < XAVGC20.10 AND AVGC10 > XAVGC20) AND (XAVGC20.10 < XAVGC30.10 AND XAVGC20 > XAVGC30)
  • Young Trends TI65
     avgc7/avgc65>=1.05 and AVGC7.20 / AVGC65.20 <= 1.05 and minv3.1>=100000
  • TI65
     avgc7/avgc65>=1.05 and minv3.1>=100000
  • SwingTradeBot IPO Screener

Landry Bowties and Young Trends TI65 look for trend reversals, TI65 looks for strong trends. The IPO Screener website is the best resource I have found for scanning IPOs.

Every weekend I also go through a watch list of markets indexes, as well as several market indicators. This is not a super important part of my trading but I do like to see how the markets are behaving. Though I don’t short much, I do try to run some short scans as well as some ETF scans as I maintain a short and ETF watch list. This is something I do if I have the time.

After adding new candidates to my watch list I will go through my watch list and flag the best set ups and copy them to a new watch list of the best set ups for the week. I will also remove any stocks that no longer are watch list material from my watch list as I go through it. I try to pare down to the best 20–25 stocks every week. From that list I attempt to flag the best 5 or so out of those. These are the ones I will most want to buy if they set up. I place alerts in Interactive Brokers for the 20–25 stocks on my Weekly Watch List. IB is set up to send me an email in Gmail which via Labels in Gmail will put a notification on my phone. This allows me to get alerts and take appropriate action while working.

The last thing I do is update my Google Doc of my stops/targets for my current holdings. I maintain this list in Google Docs as I do not want to have a hard stop with my broker. I will get into the why of that later.

If I have time I do occasionally like to go through and read through the Stockbee timeline, StockTwits, and my Twitter feed for anything of interest. This doesn’t always happen and rarely do I see anything of interest, but occasionally I do find something very interesting that I can use.

Working person’s trading method series:

Part 1: Why you should trade.

Part 2: Resources

Part 3: My Trading History and Introduction.

Part 4: An overview of my process.

Part 5: The characteristics of a stock that makes my watch list.

Part 6: Money Management: Finding Buy Points, Setting Stops and Targets, Position Sizing

Part 7: The Weekday Routine and Scans

Part 8: The Weekend Routine and Scans

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Originally published at Speculate Freedom.

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