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Welcome to the "Novice" club!
<P>Many of us, just like you, are newcomers to this game. The RT's
group is an excellent forum.
<P>I have liked Larry McMillan's site (www.realtraders.com) for information.
<P>Girish Patel
<P>Reuben Holland wrote:
<BLOCKQUOTE TYPE=CITE> <FONT COLOR="#000000"><FONT SIZE=-1>This
is a first time message for me but I have been reading realtraders e-mail
for several weeks now. I have a brokerage account with schwab and
have tried investing in stocks with moderate success. I'm am fascinated
with the possibility of trading for a living and would like the guidance
of some of you "experts" out there to point me in the right direction.
I have seen talk of Robert Miner's book Dynamic Trading and have studied
MacMillin's books on options. The few trades I have tried with the
OEX have been miserable! I would be most appreciative of anyone who
would show me some basics.</FONT></FONT> <FONT COLOR="#000000"><FONT SIZE=-1>Reuben</FONT></FONT><FONT COLOR="#000000"><FONT SIZE=-1>angler@xxxxxxxx</FONT></FONT></BLOCKQUOTE>
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</x-html>From ???@??? Mon Jan 19 18:58:17 1998
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Date: Mon, 19 Jan 1998 20:03:26 -0600
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From: "Jack Hutchison" <jghutchison@xxxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Subject: Range Breakouts
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> From: Proeber, Tim <TProeber@xxxxxxxxxx>
> To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
> Subject: RE: Breakout from congestion
> Date: Monday, January 19, 1998 8:36 AM
>
> Sometimes (about 50% of the time), there will be a fake in the opposite
> direction of the eventual true breakout. How to filter ? . ? . ?
>
> Tim
>
>
> > -----Original Message-----
> > From: Paul Cote [SMTP:cote@xxxxxxxx]
> > Sent: Monday, January 19, 1998 5:15 AM
> > To: RealTraders Discussion Group
> > Subject: Breakout from congestion
> >
> > A relatively simple method of trading the market is to trade a
> > breakout
> > from congestion. A congestion is defined by a market that was
> > trending
> > but then begins going horizontal for a while. The confines of
> > congestion are contained by two horizontal lines, one above and below.
> > When the market closes above or below these lines, a position is taken
> > in the direction of the breakout. The exit from the position is when
> > the market reverses so a trailing stop would be the exit mechanism.
> > Has
> > anyone tried this trading method?
> >
> > Paul Cote
Paul,
If you have been following this thread then you will have noted that these
range breakouts (& breakdowns) are often followed by a gap up (down) the
following day. This is because so many traders use this methodology and
force the action. (I'm not complaining.) After the gap up, the stock will
normally retrace 50% of the gap up move on day two. On reversal, enter the
trade long with a tight stop.
Alternatively, on failure, short the mother. Shorts always work best
because the action is so fast. Price will normally fall back to support at
the bottom of the range.
Jack Hutchison
The Pristine Day Trader also recommends this long trading strategy and they
claim that it is almost always tradeable.
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