Channel Traders

[Guest3722A]

Through my research I've been running across quite a few stocks with technical patterns that appear to be confined to a channel. No fundamental analysis has been done and all I'll be listing are based on technicals only.

I will update them as I find em.

Here's the first list:


hubg
nflx or setup for short
fire?
blud?
sfnc
mtsc
sfsf
oclr
apei
fsys
asgr
ocfc
bjri
asbc

 

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[Guest3722A]

SFSF (Success Factors) has been a fun one as far as a channel trader!

 

[Ynot]

so what strategy do you recommend for these, selling OTM options, buying and selling as it bounces off the channel bounds, buying ATM straddles waiting for a channel breakout?

How do you intend to profit from this knowledge?

 

[Smooth]

so what strategy do you recommend for these, selling OTM options, buying and selling as it bounces off the channel bounds, buying ATM straddles waiting for a channel breakout?

How do you intend to profit from this knowledge?

I guess it comes down to your risk tolerance and how much capital you have to work with, but I am interested in hearing the OP's thoughts on this since it looks like he has done his homework.

 

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[Guest3722A]

Ynot-

What works for me may not work for others as every individual has his own risk tolerances. Here's a breakdown of what came to mind of how I approach trading in regards to your question:

First, I recommend studying and learning how to manage risk, which includes the use of both physical and non physical stops, as well as what percent of equity one is willing to risk on various trades which many times could be adjusted according to the security's volatility, as well as the volatility of the overall market. Once an understanding of this is had, it makes it much easier to take a chance on a position.

The next thing is psychology which many traders don't realize that they may have a problem with. Imo, the book, "Trading in the Zone" by Mark Douglas is an exceptional read which I'm sure will help most traders of all levels overcome psychological hang-ups.

Last, and some may disagree, but I highly recommend watching one or two stocks 6.5 hours a day, tick by tick, in different time frames for weeks on end, and then do this again with another set. The reason why this to me is so important is because it has trained me to learn the personalities so to speak of the types of 'traders' different stocks are. This includes things like how the various specialists and market makers move and react to the various day in and day out changes of the overall market, as well as the cumulative 'personality' of the types of traders and investors who trade them.

Once all of this is achieved, it will enable the trader to formulate his or her own strategies, according to his or her individual personalities and risk tolerances.

To summarize all this and to say it again, what works for me may not work for others. However I believe that going through the above mentioned suggestions will help each individual trader to find his or her comfort zone.

In the mentioning of Success Factors (SFSF) above, I already 'knew' the stock and have traded it in the past, and, my personal system of how I trade is about as simple as it gets. I strictly buy and sell stocks using different strategies and set-ups. It works well for me and my comfort level.

 

[Guest3722A]

SFSF -success factors broke out of it's 5 month channel on volume! DMI signaled this possibility early on too

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