Let’s review what Simon sez to do and using only two (2) simplistic rules. These are silent charts that speaks volumes.
Imagine your on a roller coaster. Now lets see you can write the two (2) rules on the back of a Business card.
SPY via Charlie 5.0
SPDN
Ditto for $BTCUSD and $ETHUSD either using daily charts or 4 hour charts all day long. They are like the little ATM machine that could.
One can earn $250.00 as a limit order to sell after buying the coin day after day.
Options is a ZERO sum game and most people will lose the Tommy Johns.
Just a though at what a professional swing trader does for fun.
Quill -
Try to look at COST, CELH and V. Costco and Visa are sorta linked. If you are a card holder of Cosco, you will understand Visa.
On the V chart, you may slide the chart left to right or right to left and notice the automatic buy and sell signals.
Bottom line, can you write a set of rules for the above simple charts.
Hey Doc,
Thanks but they are nothing special. I think the key is to just mark up a chart and see what you see. I think a lot of folks are worried that to annotate a chart, they will be judged so they hesitate to drop lines. Sometimes you don’t notice something until you do put some lines down and then “step back” and look at it. You can always erase attempted annotations if they don’t seem to fit or help you see things. I certainly erase more lines than I leave drawn on charts.
I will comment that I don’t try to use a lot of rules, except the main one being about channels. For down trends I draw a line that “best fits” the highs, while I use lows for the uptrends. I don’t critically try to draw through exact candle points (such as the wick high versus the body high that others may use). However, I am picky about then doing a duplicate or copy of that line (Ctrl-D windows control in Stockcharts Sharp Charts) and drag to the best fit on the other apparent side of the channel. It always surprises me how often that line fits close to what I would draw to fit. But no annotation is absolute or that specific, they are merely guides to help form a picture.
You referred to SPY’s expected move from the channel, but let me point out that once a stock has solidly broken a channel, that channel generally has no more meaning. Sure, once and a while, it moves to fall back in that range, but generally, you have to anticipate it is much more likely to form a new pattern. I am anticipating an uptrend, but there is not enough data points to tell me anything right now.
I use these charts all the time to do verticals, most often Put credit spreads and iron condors. But options are a whole 'nother discussion. This thread has already become engorged with diversity. But kinda nice to have an ongoing conversation…
Looking at this costco chart and it looks like the buy sell would have resulted in a loss! I do agree that COST looks like a money maker but not every trade is a winner. Are my parameters off? Trying to figure this out…doc
Hey, Doc. Yes, COST has been on something of a tear lately. I look at COSTCO very simply not really looking at any indicators or swings. The simple fact is that they recently and clearly broke to a new 52-week high and are very close to challenging their all time high. This is very bullish. Now, are they really worth more today than their last peak in April of 2022? I really don’t know, but I really don’t much care. It appears to me right now like traders are thinking that they could be.
Pulling back to shorter term charts (5-min) seems to suggest that it might pull back a bit due to being a bit overbought. But the overall trend appears bullish so I wouldn’t think that it would go too far negative. Unless it does.
Quill, I look at the charts per the SS rules and in general what you say is true. I agree with Charlie however that sometimes there is a whiplash and you get stuck with a loss however small if one is jumping in and out of the market. That being said I like the SS method.
Derek, I am watching both COST and AMZN. AMZN dipped today but tomorrow is monthly options expirations and that could be the reason for the increased volatility that we are seeing is my thought…doc
Yes, they both look really good, especially since the market as a whole appears to be in rally mode. If the market steps back then a lot of the bullish stocks may at least take a pause. My main problem right now is that I haven’t been able to monitor the market much right now due to other priorities.
I can relate as I have been traveling too. 2 trips to Vegas to spend time with the daugher and grand children with a beach trip squeezed in between. I’m down in Houston this week for a funeral and Thanksgiving and won’t be home until after Thanksgiving…doc
Wow, Doc. Certainly hope that those are nice trips for you. I’m not traveling for Holidays this year, but my extended family is all local to me. I do have many (7) kids who are mostly adults in their 30s and 20s and some of those live out of state, but I do get to see most of them pretty frequently.
In all likelihood, I won’t be doing much in the market until January. Maybe a little here and there but not like it’s been.
Retirement has been hard. All this traveling lol. The trips are good trips to visit our kids and family. I just went to East Texas for a wedding and saw a lot of family that we haven’t seen in a while. My wife had the chance to see her siblings and her parents. We will be down in the Houston area for a while as we are watching some grand kids then back home to get ready for our kids and gk’s to come visit for the Christmas season. Its been a hectic last few months…doc
Yes, well I envy you and your hard retirement. Unfortunately for me I had too many kids so I still have two who are still minors. Won’t be able to retire at least until I get those through college. I suppose I could retire if I was making gazzillions trading, but alas, I am not quite there yet.
So I have some ARM and I am going to trade it using SS. My entry was $56.10 as a reference point and I am currently watching for the LOL red dots Quill Charlie Derek…doc
quill, theoretically when would YOU determine that you would sell, at the open with a red dot from the day before or at the close with a red dot or during the day if the red dot appeared?
56.10 is a nice entry. I think this one could very well get to 70+ based on recent movement. Now, when it would get there is another question. Now depending on how many shares you have, you might want to consider selling a longer term covered call. If you have at least 100 shares, you could sell an April 70 call, and if it gets to $70 then you would sell your shares for $70 or a 24.7% profit, plus pocket an extra $4 per share which is an extra 7.1% profit. And if it never reaches $70 you still pocket the extra 7.1% just for playing.
If ARM goes down instead of up, then you might stop out of your ARM holdings, and if you no longer have shares then you are left open on the call you sold. Now, if ARM goes down the call is more likely to expire worthless, but if it reverses upward sharply after stopping you out, you could really be in a bind.
When the signal turns red I’m selling my position. Otherwise I’m riding it out. I’m not selling a call on my position because then I can’t sell my position until the call expires. I’m just trying this SimonSez tactic of Quill’s to see how it does. I’ve been following Quill and Arindam for a while and they both discuss the method. Arindam has been a great source of information. Quill just keeps restating follow the rule and make some cash. It’s so easy even a teenager can do it (his nieces I believe follow this or he claims anyways). Also, I like ARM for an investment. Nvidia tried to buy them you know…doc
But I’d say that your entry was less than crisp. So, let’s review “the rules.”
Depending on whether your’re trying to trade off of HA bars or hollow candles, and depending on how much confirmation your rules require, and depending on whether you make your entres with buy-stops, your entry coulda been at the open on the 15th or 16th, and a bit cheaper than $56.10.
I bought all at once and I missed the entry by a day or two but decided to jump in because the market trend was up, I still had a green dot LOL, I was thinking about how Nvidia tried to buy ARM and the tech sector was looking hot due to recent earnings. I took a small position to try out quill’s buy sell on the indicators per the SS rules. I also have moved the image so the right edge of the chart is dragged over to the left so you only see the last one or two bars for this image.
No sell signal yet, but the face switched again to the not smiley…doc
How much theoretical value do you place on the information that MSFT, AMZN and GOOG are all working with ARM to develop their own gpu’s regarding the future? That was another factor that got me to buy ARM btw…doc
Ignore the Smiley Faces. Trying to trade off of them will drive you crazy, for two reasons: They keep repainting. Two, BC bases them on the low (or high) for the day, which is often an anomalous print. Instead, use hand-drawn Support & Resistence lines based on the body of the candles, not their tails.
In the many months that I have been reading how you trade off the SS rulez, thats the first time you have said anything about hand drawing support and resistance lines I believe…doc
I don’t trade off of SS rules. That’s Quill’s gig, not mine, though it’s a method I’ve contributed to and do endorse, especially for confirmation of the likely viability of a trade. Then, following the rules (generally) keeps one out of trouble.
EDIT. CYA is a recent postiion I put on. Chart it, and you’ll see that Simon says nothing useful. But I’m ITM on it. (In at 0.53.) Ditto USOI. Bought Tues at 73 something, I’m ITM on that one, too. Last week, or maybe it was the week before, I did 27 round trips in under a week, averaging 5.5% per position.
So, yeah. I look at charts, just as I look at fundamentals. But I trade on hunches as well.
