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Re: Scalping Help!



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<DIV><FONT color=#000000 size=2>I'm simply playing overhyped inet-related news - 
to name a few such plays of recent memory: AAGP, SHRP, SKYM, RMII. My method 
could not be simpler.&nbsp; I check <A 
href="http://www.briefing.com/Schwab/inplay.htm";>http://www.briefing.com/Schwab/inplay.htm</A>, 
starting at about 1/2 hour before the open.&nbsp; I check for news releases 
about (for the most part) rinky dink companies establishing a web presence OR 
companies whose CEOs will appear on CNBC.&nbsp; The impact of blurbs about these 
two events can have irrationally spectacular short-term effects on share 
price.&nbsp; </FONT></DIV>
<DIV><FONT color=#000000 size=2></FONT>&nbsp;</DIV>
<DIV><FONT color=#000000 size=2>Take AAGP.&nbsp; On Christmas Eve the stock 
closed @ 1 3/8.&nbsp; They had a release the following session before the open 
about establishing a Website.&nbsp; The stock opened above 2, rocketed as high 
as 15, then closed at around 12.&nbsp; The next day it gapped open @ 18 and went 
as high as 25, to close at around 19.&nbsp; The following day it gapped down and 
went into a freefall after the open, closing at around 13.&nbsp; In the next 3-4 
sessions it continued its massive downtrend and dropped to below 5!</FONT></DIV>
<DIV><FONT color=#000000 size=2></FONT>&nbsp;</DIV>
<DIV><FONT color=#000000 size=2>Such plays are not without significant risk, but 
I am not a risk averse type.&nbsp; Also, never forget the time-honored dictum: 
&quot;The trend is your friend until it ends&quot;.&nbsp; I am convinced that 
such opportunities will evaporate entirely within the next couple of quarters, 
but for now they more than keep food on the table!!</FONT></DIV>
<DIV><FONT color=#000000 size=2></FONT>&nbsp;</DIV>
<DIV><FONT size=2>Regards,&nbsp; Paul Szilassy</FONT></DIV>
<BLOCKQUOTE 
style="BORDER-LEFT: #000000 solid 2px; MARGIN-LEFT: 5px; PADDING-LEFT: 5px">
    <DIV><FONT face=Arial size=2><B>-----Original Message-----</B><BR><B>From: 
    </B>S&amp;P 500 &lt;<A 
    href="mailto:sp500@xxxxxxxxxxxxxx";>sp500@xxxxxxxxxxxxxx</A>&gt;<BR><B>To: 
    </B>szilassy@xxxxxxx &lt;<A 
    href="mailto:szilassy@xxxxxxx";>szilassy@xxxxxxx</A>&gt;<BR><B>Date: 
    </B>Tuesday, January 12, 1999 1:32 PM<BR><B>Subject: </B>Re: Scalping 
    Help!<BR><BR></DIV></FONT>
    <DIV><FONT color=#000000 face="Comic Sans MS" size=2>Great post 
    !!!!!!!</FONT></DIV>
    <DIV><FONT color=#000000 face="Comic Sans MS" size=2></FONT>&nbsp;</DIV>
    <DIV><FONT face="Comic Sans MS" size=2>What type of news plays are you 
    talking about??</FONT></DIV>
    <DIV><FONT face="Comic Sans MS" size=2>Internets, Techs or are you using 
    options???</FONT></DIV>
    <DIV><FONT face="Comic Sans MS" size=2></FONT>&nbsp;</DIV>
    <DIV><FONT face="Comic Sans MS" size=2>Thanks</FONT></DIV>
    <DIV><FONT face="Comic Sans MS" size=2>Rob</FONT></DIV>
    <BLOCKQUOTE 
    style="BORDER-LEFT: #000000 solid 2px; MARGIN-LEFT: 5px; PADDING-LEFT: 5px">
        <DIV><FONT face=Arial size=2><B>-----Original 
        Message-----</B><BR><B>From: </B>Szilassy &lt;<A 
        href="mailto:szilassy@xxxxxxx";>szilassy@xxxxxxx</A>&gt;<BR><B>To: 
        </B>RealTraders Discussion Group &lt;<A 
        href="mailto:realtraders@xxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxx</A>&gt;<BR><B>Date: 
        </B>Tuesday, January 12, 1999 4:25 PM<BR><B>Subject: </B>Re: Scalping 
        Help!<BR><BR></DIV></FONT>
        <DIV><FONT color=#000000 size=2>I have to agree.&nbsp; My mentor is 
        someone who trades with at least $500k, compared with my abysmally small 
        fraction of this amount.&nbsp; He frequently has three-four open equity 
        trades and mixes position trades with day trades.&nbsp; He is VERY 
        successful trading only bellwethers, which are usually of a price range 
        which allows me to buy no more than 100-300 shares at one time.&nbsp; 
        Scalping 1/8 - 3/8 as he regularly does with his 1,000 share trades is 
        simply not a viable option for me and never was.</FONT></DIV>
        <DIV><FONT color=#000000 size=2></FONT>&nbsp;</DIV>
        <DIV><FONT size=2>I spent 5 months of being almost consistently in the 
        hole and falling hard every time I managed to climb out, most times 
        waffling somewhere between 15-35% beneath my initial starting 
        capital.&nbsp; I varied approaches, set up rules and violated them 
        whenever I tasted success for more than 2 or 3 sessions in a row.&nbsp; 
        For months though, I tried eking out an existence with 100-300 shares of 
        the bellwethers, mirroring my mentor's method.</FONT></DIV>
        <DIV><FONT size=2></FONT>&nbsp;</DIV>
        <DIV><FONT size=2>After experimenting with all kinds of techniques and 
        preferred plays (all of which work well for professional traders who 
        have been in the game 4-5 years), I decided that what works for me is 
        what they all STEADFASTLY recommend against:&nbsp; newsplays in the 
        under $20 category.&nbsp; My successes have been recent, but very 
        consistent.&nbsp; My return on capital for the week after Christmas was 
        87.5%.</FONT></DIV>
        <DIV><FONT size=2></FONT>&nbsp;</DIV>
        <DIV><FONT size=2>I used specifics to illustrate an important point - 
        ignore all the noise (no matter how respectable the source) and do what 
        works best for you.&nbsp; That's the only approach which can ensure your 
        prosperity as a trader.&nbsp; </FONT></DIV>
        <DIV><FONT size=2></FONT>&nbsp;</DIV>
        <DIV><FONT size=2>Best regards,&nbsp; Paul Szilassy</FONT></DIV>
        <BLOCKQUOTE 
        style="BORDER-LEFT: #000000 solid 2px; MARGIN-LEFT: 5px; PADDING-LEFT: 5px">
            <DIV><FONT face=Arial size=2><B>-----Original 
            Message-----</B><BR><B>From: </B>Terry S. Smith &lt;<A 
            href="mailto:tesla@xxxxxxx";>tesla@xxxxxxx</A>&gt;<BR><B>To: 
            </B>RealTraders Discussion Group &lt;<A 
            href="mailto:realtraders@xxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxx</A>&gt;<BR><B>Date: 
            </B>Tuesday, January 12, 1999 12:57 PM<BR><B>Subject: </B>Re: 
            Scalping Help!<BR><BR></DIV></FONT>
            <DIV><FONT size=2>How about getting a new buddy? Just kidding, 
            actually who you hang around can influence your success or lack of 
            success. I ended a relationship many years ago when the woman I was 
            with constantly criticized my trading, even tough my method was 
            making money. Had she ever traded a futures contract in her life? 
            No. Therefore, she really was not qualified to comment on my trading 
            activities. And even if she was a successful futures trader her 
            method is not my method. Happy trading. </FONT></DIV>
            <BLOCKQUOTE 
            style="BORDER-LEFT: #000000 solid 2px; MARGIN-LEFT: 5px; PADDING-LEFT: 5px">
                <DIV><FONT face=Arial size=2><B>-----Original 
                Message-----</B><BR><B>From: </B>Gary Kramer &lt;<A 
                href="mailto:gmkramer@xxxxxxxxxxxx";>gmkramer@xxxxxxxxxxxx</A>&gt;<BR><B>To: 
                </B>RealTraders Discussion Group &lt;<A 
                href="mailto:realtraders@xxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxx</A>&gt;<BR><B>Date: 
                </B>Tuesday, January 12, 1999 1:00 PM<BR><B>Subject: 
                </B>Scalping Help!<BR><BR></DIV></FONT>
                <DIV><EM><FONT color=#000000 size=2>I have been day trading 
                Spoos for about 5.5 months now and have a dilemma.&nbsp; When I 
                first started out, I scalped the market and made 1-2 points per 
                trade and was making money consistently.&nbsp; I was using 
                retracements as the basis for my trades.&nbsp; Everything I read 
                and everyone I listened to suggested that in order to succeed, i 
                needed to let profits run.&nbsp; I noticed that I left a lot on 
                the table so I investigated a whole bunch of other 
                systems.&nbsp; Nonetheless, even though the systems worked, they 
                did not work for me.&nbsp; I just couldnt let my profits run and 
                I wasnt good at implementing the strategies.&nbsp; My confidence 
                soured and I reverted back to the scalping to get my equity and 
                confidence back.&nbsp; Again, I tried other strategies and 
                failed.&nbsp;&nbsp; I am back to scalping and feel real good 
                about it.&nbsp; I have a friend who guarantees that I will fail 
                if i scalp.&nbsp; I have looked back at hundreds of charts and 
                recognize that based on my strategy of buying or selling 
                pullbacks, the success rate is near 80% with objectives of 1.5-2 
                points.&nbsp; The question is: can I make money?&nbsp;&nbsp; I 
                have done so, am doing so now, but its bothering me that this 
                buddy of mine insists that it cant be done.&nbsp; 
                </FONT></EM></DIV>
                <DIV><EM><FONT color=#000000 size=2></FONT></EM><EM><FONT 
                color=#000000 size=2>&nbsp; BTW, I always have a 2 point stop 
                in!</FONT></EM></DIV>
                <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
                <DIV><EM><FONT size=2>Any words of wisdom would be most 
                appreciated!</FONT></EM></DIV>
                <DIV><EM><FONT size=2></FONT></EM>&nbsp;</DIV>
                <DIV><EM><FONT size=2>Thanks</FONT></EM></DIV>
                <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
                <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
                <DIV><EM><FONT color=#000000 size=2><BR>Gary 
                Kramer<BR></FONT></EM></DIV></BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></BLOCKQUOTE></BODY></HTML>
</x-html>From ???@??? Tue Jan 12 18:39:31 1999
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Subject: Re: Scalping Help!
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<DIV><FONT color=#000000 size=2>I day trade the S&amp;P in a similar manner. If 
I want to start digging a hole I have my choice of a) buying breakouts, b) 
waiting for a hesitating trade to go my way, c) trying to run a small winner 
into a big one. When the hole gets deep enough, I go back to entering on 
retracements, getting out if momentum does not build quickly, and getting out 
when my first price objective is hit. The whole question of profit size seems to 
come down to the very reason we day trade short time frames - the ability to 
tightly control losing trades with very small losses. Taking longer trades 
requires using larger time frames and being willing to accept larger losses on 
the losers. There are times when one can identify, using multiple time frames, 
those trades where the odds are highly favorable to a larger move.</FONT></DIV>
<DIV><FONT color=#000000 size=2></FONT>&nbsp;</DIV>
<DIV><FONT size=2>Earl</FONT></DIV>
<BLOCKQUOTE 
style="BORDER-LEFT: #000000 solid 2px; MARGIN-LEFT: 5px; PADDING-LEFT: 5px">
    <DIV><FONT face=Arial size=2><B>-----Original Message-----</B><BR><B>From: 
    </B>Gary Kramer &lt;<A 
    href="mailto:gmkramer@xxxxxxxxxxxx";>gmkramer@xxxxxxxxxxxx</A>&gt;<BR><B>To: 
    </B>RealTraders Discussion Group &lt;<A 
    href="mailto:realtraders@xxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxx</A>&gt;<BR><B>Date: 
    </B>Tuesday, January 12, 1999 12:56 PM<BR><B>Subject: </B>Scalping 
    Help!<BR><BR></DIV></FONT>
    <DIV><EM><FONT color=#000000 size=2>I have been day trading Spoos for about 
    5.5 months now and have a dilemma.&nbsp; When I first started out, I scalped 
    the market and made 1-2 points per trade and was making money 
    consistently.&nbsp; I was using retracements as the basis for my 
    trades.&nbsp; Everything I read and everyone I listened to suggested that in 
    order to succeed, i needed to let profits run.&nbsp; I noticed that I left a 
    lot on the table so I investigated a whole bunch of other systems.&nbsp; 
    Nonetheless, even though the systems worked, they did not work for me.&nbsp; 
    I just couldnt let my profits run and I wasnt good at implementing the 
    strategies.&nbsp; My confidence soured and I reverted back to the scalping 
    to get my equity and confidence back.&nbsp; Again, I tried other strategies 
    and failed.&nbsp;&nbsp; I am back to scalping and feel real good about 
    it.&nbsp; I have a friend who guarantees that I will fail if i scalp.&nbsp; 
    I have looked back at hundreds of charts and recognize that based on my 
    strategy of buying or selling pullbacks, the success rate is near 80% with 
    objectives of 1.5-2 points.&nbsp; The question is: can I make 
    money?&nbsp;&nbsp; I have done so, am doing so now, but its bothering me 
    that this buddy of mine insists that it cant be done.&nbsp; 
    </FONT></EM></DIV>
    <DIV><EM><FONT color=#000000 size=2></FONT></EM><EM><FONT color=#000000 
    size=2>&nbsp; BTW, I always have a 2 point stop in!</FONT></EM></DIV>
    <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
    <DIV><EM><FONT size=2>Any words of wisdom would be most 
    appreciated!</FONT></EM></DIV>
    <DIV><EM><FONT size=2></FONT></EM>&nbsp;</DIV>
    <DIV><EM><FONT size=2>Thanks</FONT></EM></DIV>
    <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
    <DIV><EM><FONT color=#000000 size=2></FONT></EM>&nbsp;</DIV>
    <DIV><EM><FONT color=#000000 size=2><BR>Gary 
Kramer<BR></FONT></EM></DIV></BLOCKQUOTE></BODY></HTML>
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RobertBu wrote:

> Not a web site, but a book.  I've not read it
> yet, but it is reported to contain accounts
> of the tulip mania and the South Sea
> Trading company mania plus several
> more.
>
> Extraordinary Popular Delusions and the Madness of Crowds : And Confusion De
> Confusiones (Wiley Investment Classics)
> by Charles MacKay --- $11.20 plus shipping at Amazon.
>
> Book Description
> A complete repackaging of the classic work about grand-scale madness, major
> schemes, and bamboozlement--and the universal human susceptibility to all
> three. This informative, funny collection encompasses a broad range of
> manias and deceptions, from witch burnings to the Great Crusades to the
> prophecies of Nostradamus.
>
> == Rob ==

    Another good book along these lines is Manias, Panics, and Crashes, by
Charles P. Kindleberger.

Maniacally,

Norman