01/28/2011 a miserable day

Today my stockes go beaten. One stock down 8%, the others down 6%, 3%.... I failed to set the stop order. I was thinking that there would be a bounce soon, but my stock was just keeping moving downwards.

ENTR: bought 500 at 11.21. Up to 11.95 the next day I bought it. It could be a winning trading. I told myself I need to sell if the price drop under 11.67. But I did not do it. Right now ENTR is only 10.94.

Great lesson to learn! Set the stop order every time I make a buy order!!!

some 股市规律:

股市规律:

1.只要没有通货膨胀，联储能维持低利率，对股市就是好。

2. 企业利润好，尤其又是低利率，更好。

Option Trading Tips

http://www.optiontradingtips.com/options101/index.html

"Holy Grail" Intra Day Patterns from TraderStewie

http://theimpatienttrader.blogspot.com/2008/01/holy-grail-setup.html

IN a momentum market or when trading momentum stock: on common pattern i usually like to trade is the Holy Grail(HG) Pattern:

some free stock trading books download from website

http://tradingbookscollection.blogspot.com/

Option Volatility - A Powerful Indicator in Trading

http://www.options-trading-mastery.com/option-volatility.html

The concept of option volatility is one of the most little understood and under utilised in option trading. But knowing about it can make all the difference to the profitability or otherwise, of your trading decisions. It should also be very influential in the type of trades that you decide to put on.

What is Volatility?

Volatility, as the name implies, is a measure of the range in which a stock price is expected to travel during a given timeframe. Sometimes stock prices appear to hover within a tight range for a while, in which case you would say that the short term volatility is low. But then a price breakout comes and a strong directional movement occurs, at which time you would say that volatility has increased.

The trick is to determine whether there is any correlation between the price volatility of the underlying financial instrument over a given period, known as the "Historical Volatility" (HV) and the option volatility that is implied in its associated option prices. Where a disparity occurs, it often presents trading opportunities.

Implied Volatility

Essentially, before we place an option trade we need to decide whether the option contract we're looking at is over-priced or under-priced - and the way we do this is by analyzing what is known as the "Implied Volatility" in the option price - the option volatility number. If we decide that the option is going for a bargain because the Implied Volatility (IV) is low, then it presents a great buying opportunity. On the other hand, if the option is considered expensive we would probably avoid going long and look at option trading strategies such as spreads involving "sell to open" positions.

Unlike futures and CFDs, option prices are more complicated affairs. You may have heard of the Black-Scholes or the American Binomial option pricing models. These are mathematical formulas which take into account the current market price of the underlying stock in relation to a relevant option strike (sometimes called 'exercise') price, plus the number of days to option expiry, in order to calculate a theoretical price for the option contract. If the current bid-ask price of the option is above the theoretical price then we would say its Option Implied Volatility is high. Conversely, if the price is below the theoretical price then the IV is low.

Implied Volatility thus becomes two things. 1. A premium or discount above or below the theoretical fair value of the option. 2. An indicator of anticipated future price volatility of the underlying stock, usually determined by the market maker.

Historical Volatility

The other factor that must be borne in mind in order to give the IV some meaning, is the Historical Volatility of the stock itself. Both the HV of the stock and the IV of the option are expressed as a percentage and should be compared before entering a trade. Historical Volatility is basically a stock's price movement either side of an average over a predetermined number of historical trading days.

Let's say you're looking at a stock in an upward trend and want to take a call option position following a pullback. You would have a choice of "in the money" (ITM), "at the money" (ATM) or "out of the money" (OTM) strike prices. As you compare the call option prices for each strike price, you may notice that the OTM options are over-priced compared to the ATM prices. This is due to option volatility in addition to the reasonable 'time value' left in the option price. This being the case, you would not want to be buying the OTM options, even though they may appear a little cheaper. You should either 'buy to open' the ATM options or even take out a Bull Call Spread because the OTM sold options would give you a greater credit and make your overall position cheaper, thus giving you an advantage.

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How to Use Option Volatility

So why is Implied Volatility so crucial for the options trader? One reason is, because as a rule, the price of an option will always revert to its fair value over its remaining life. This means that, if you 'buy to open' an option when its IV is too high, then even if the price of the underlying stock goes as you anticipated, the option price itself may not increase in value. In fact, it is not uncommon for such a setup to result in favourable stock price movement but loss on the option trade, because the option has retreated back to its fair value.

So, for example, if you were to buy a 30 day option that was 20% overpriced - it would depreciate 20% over the next 30 days - possibly more - depending on movements in volatility of the underlying.

But the reverse is also true. If you buy an option at a bargain because its option volatility factor is low, you might even make a profit if the underlying price movement is slightly unfavourable. And if the stock price movement is favourable, your profit can be spectacular.

Here are two simple rules to remember when assessing whether an option is a good buy.

1. The 20 day and 50 day HV of the stock are both less than its 90 day Historical Value. The ideal long option trade would be where the 20 day is lower than the 50, which is less than the 90. This is not essential but it means that the stock volatility in the short term is likely to trend toward the longer term volatility.

2. Compare the 20 day HV of the stock with the Implied Volatility in the current price of the option. If option volatility (IV) is less than the stock HV, it is a good buy.

Conclusion

Option Volatility is one key factor that distinguishes options from other derivatives. Although, like other derivatives, option prices are derived from an underlying market such as stocks, currencies or commodities, the supply and demand for these instruments comes from a standalone market. As such, they are subject to the laws of supply and demand and this means that prices will reflect that. Implied Volatility in option prices is the magic number that indicates this. Knowing how to use it to your advantage could be one of the most important areas of your trading education.

good articles for VIX

Since its introduction in 1993, VIX has been considered by many to be the world's premier barometer of investor sentiment and market volatility. The VIX Index is an implied volatility index that measures the market's expectation of 30-day S&P 500^® volatility implicit in the prices of near-term S&P 500 options. VIX is quoted in percentage points, just like the standard deviation of a rate of return.

http://en.wikipedia.org/wiki/VIX

http://www.cboe.com/micro/vix/vixoptions.aspx

VIX white book
http://www.cboe.com/micro/vix/vixwhite.pdf

Trend day strategy from TradingwithLeafwest

http://blog.tradingwithleafwest.com/?p=1066

Today ended up being a Trend Day … once you recognize it as being a Trend Day the trading strategy is pretty simple.

1. Short all retracement moves into the 20 ema;
2. Then expect a retest of LOD’s and probably a new low;
3. Then cover the short on a reversal signal/candle;
4. Then wait for retracement into the 20ema;
5. and then … rinse repeat.

It’s really as simple as that … place your stop above the 50ema and keep assuming that the TREND DAY will continue until it proves to you that it is not going to.

Turn off all your indicators … only two things PRICE and MOVING AVERAGES matter. Ignore MACD’s, RSI’s etc. The only indicator that serves some purpose is the TICK indicator … pay attention to this to confirm the pushes to new LOD’s. If the TICK does not make a new LOD when price does, be a little more careful on the next retracement into the 20ema. The pullback may be a little more complex (i.e., 2-legs) or it might even push through the 20ema by a little bit.

When do you know it is a potential TREND DAY? I use a pretty simple method. If after the first couple of 5-min candles, the market pushes in one direction strongly and breaks resistance prices, your antenna should be going up. After the first hour (10:30am eastern), if the market really hasn’t had any push in the opposite direction, you can start to assume it is unfolding as a TREND DAY and put on your TREND HAT. Until the 50ema is broken, keep implementing your TREND Day tactics.

我的2010国家公园之旅 (zz)

http://www.mitbbs.com/article_t/Travel/31443241.html

看了mySpringCa的“西南部国家公园玩遍”系列，俺也来凑凑热闹，回忆一下我一年来去过的公园。2010年是我们名副其实的旅游年，从2009年圣诞开始，到2010年12月31日，我们一共去了大大小小36个公园，除了前面四个加星号的不在国家公园系列之内，其余32个都是。我们的国家公园年票可算是充分发挥了它的作用。我们一直用到2010年12月31日。:)Meteor Crater Arizona *The Wave *Antelope Canyon *Bryce Canyon National ParkZion National ParkCoral Pink Sand Dunes State Park *Death Valley National ParkGrand Canyon National ParkBadlands National ParkMount Rushmore National MemorialYosemite National ParkGuadalupe Mountains National ParkCarlsbad Caverns National ParkWhite Sands National MonumentSaguaro National ParkChiricahua National MonumentGreat Smoky Mountain National ParkGrand Teton National ParkYellowstone National ParkSequoia & Kings Canyon National ParkKenai Fjords National ParkDenali National ParkArches National ParkCanyonlands National ParkJoshua Tree National ParkSan Juan National Historic SitePetrified Forest National ParkEl Morro National MonumentEl Malpais National MonumentRocky Mountain National ParkArapaho & Roosevelt National Forest (Mount Evans)Lassen Volcanic National ParkMammoth Cave National ParkShenandoah National ParkJefferson National Expansion Memorial - Gateway ArchEverglades National Park每次回来我也大都根据回忆和照片整理游记。不过受能力所限，我的游记大都是流水帐式的。虽然不如别人的精彩，不过数量够多，发在这里给后人做个参考吧。如果谁发现其中什么错误，欢迎指正，我会立刻改正。:)（最后几个公园的游记还没写好，以后再发）美西南自驾游http://docs.google.com/fileview?id=0B6KgEWLqcKuWOThmY2E3YzgtMmI总统山和恶地http://docs.google.com/fileview?id=0B6KgEWLqcKuWMWVlZTY1YjgtMmV大俗地优胜美地http://docs.google.com/fileview?id=0B6KgEWLqcKuWZDY3MzZkZDEtY2Y白与黑http://docs.google.com/fileview?id=0B6KgEWLqcKuWYjIyMjQ4OWEtOGN仙人掌之旅http://docs.google.com/fileview?id=0B6KgEWLqcKuWYTZlOWRhYWItMmE浪漫萤火虫http://docs.google.com/fileview?id=0B6KgEWLqcKuWMDlhOTMzYTgtMWQ最美的国家公园——黄石http://docs.google.com/fileview?id=0B6KgEWLqcKuWMzA5NjQ4NWUtY2I巨木之旅http://docs.google.com/fileview?id=0B6KgEWLqcKuWMGMzYWJhNDAtNDU不夜的阿拉斯加http://docs.google.com/fileview?id=0B6KgEWLqcKuWMzgxYjU4Y2UtMmN鬼斧神工的拱门http://docs.google.com/fileview?id=0B6KgEWLqcKuWMzY4YTVmMTctMDB约书亚树公园观星http://docs.google.com/fileview?id=0B6KgEWLqcKuWMmM3NDk4OGYtYjQ波多黎各之行http://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srci缤纷彩虹石化木http://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srci遭遇高原反应http://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srci火山博物馆http://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srci猛犸洞http://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srci

Looking For Tops is as Easy as 1-2-3 (zz)

http://slopeofhope.com/2011/01/looking-for-tops-is-as-easy-as-1-2-3.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+typepad%2Ftradeblogs%2Fthe_slope_of_hope_with_ti+%28Slope+of+Hope+with+Tim+Knight%29&utm_content=Google+Reader

Whether or not the overall market is currently making a top is debatable and something I will discuss in this weekend's newsletter (make sure you sign up on the blog's homepage). Nonetheless, I thought tonight's blog could discuss what investors should be looking for when analyzing charts as this could help investors in the days ahead.

Tops in stocks and markets are almost always a somewhat long drawn-out process. Therefore, there are often plenty of pitfalls for investors who often get sucked into believing that a short-period of weakness/retracement was in fact the actual "top". Investors of all stripes are often too quick in trying to protect hard earned gains and more times than not, all they end up doing is selling their positions out well before their investment reaches the real end to its current trend/move.

Some investors actually have the opposite problem as they refuse to sell even when classic confirmation signals have been registered. They spend the whole time after the change in trend direction is "official" hoping and wishing/believing that the price "has" to go back to at least the old highs. They hang on to their stock position like grim death.

An finally, there are investors who have an entirely different problem - they missed the whole or the majority of the move made by the stock and they look at the pull-back as a great chance to "buy-the-dip". What they didn't notice was that the stock they are now hot for has actually changed trend directions and they will soon be in for a whole world of pain.

All investors at one stage or another have made the above mistakes. While there is no magic potion for a cure, what I am suggesting with this blog tonight is however, that looking for/noticing tops is as easy as 1-2-3.

Tops can be for what ever time frame you are looking at, whether that it is 5-min, 60-min, daily, weekly etc. I am going to stick with the daily time period for the remainder of the blog, but the process I discuss can be applied to all time frames.

Step#1 ... you must break a significant trend line (multiple days). The penetration of the trend line must be more than just one or two candles. Obviously, if your stock breaks the trend line and spends a couple of days just below the trend line before it breaks back above it, it is more likely that this move is just part of a trend pause/retracement and not the start of a bigger trend reversal.

Step#2 ... you must make a failed retest of the previous high. The retest must be either a lower high, a double top, or a marginal new high. Most investors use a guideline like 0.5% as the limit that they give for a maximum marginal new high. Any price move higher than that and you are most likely looking too hard for a top and you are missing the bigger picture with that stock.

Step#3 ... The final step in finding a top and making it an "official" change in trend direction, is having the stock close below the swing low made after the trend line break.

The more experience you get in analyzing tops, the more you will notice common characteristics in the chart set-ups. You will notice things such as failures for stocks to break back above a significant moving average (such as the 50ema) during the retest of the previous high. These are great confirmations of the top being significant and a green light to get aggressive when shorting.

Enough of the preamble ... here are some examples (click on the charts to enlarge ... more clicks the larger it will get).

McDonald's

So in looking at the McDonald's chart we have a couple of breaks of the daily trend line. The first two breaks are highlighted with the red "A" ... notice how that first break of the trend line saw the daily candle bouncing off of the lower bollinger band before closing below the trend line. The next day saw the stock move back up to close at the trend line. This is what I was talking about in looking for a meaningful break to start the top hunting process. The next break (also highlighted with the red "A"), was a little more meaningful. However if you look at it again, the stock found support on the bollinger band and the 50ema. At best this was a warning that the stock was weakening and that a "real" break of the trend line was probably not too far away.

The first real meaningful break of the trend line happened 6 trading days later (highlighted with red "B"). The second of these two candles was a big bearish engulfing candle that broke and closed beneath the 50ema moving average.

So the next thing we have to wait for if the bounce back to retest the high. Again, not all retest are going to give you a textbook move. McDonald's retest is actually more of a sideways chop that was contained below the 20/50ema's. That is what I was trying to point out earlier. See how the McDonald's candles probed above the 20/50ema's but could not close above them? Well, that is an awesome sign that McDonald's is going to break hard real soon. No buyers were willing to push the stock higher so sellers would undoubtedly push the stock lower soon. Sure enough McDonald's broke the swing low's support line and it was off to the races.

Now the conservative method of shorting this change in trend (or sell if you were trying to maintain your long holding) is to wait for the break in the swing low support line. However, if I had seen this chart in real time, the apparant weakness at the 20/50ema's would have made me at the least start a short postion in that $76.80ish area.

Stops for a short in this case can be placed conservatively above that failed test of the 20/50 moving averages (high of candle was $77.59) at say $78.10 (I always give a little room above a whole number as they often act as magnets). An aggressive spot for a stop would be above the trend's high of $80.94 ... say $81.10. The bigger the stop, the less likely you are to get stopped out.

TLT:

I'm including TLT as an example for this blog because I wanted to highlight that the 1-2-3 process can be utilized for hunting out bottoms as well as tops. As you will see in the TLT example, anticipating the trend line break and not waiting for the actual break can cause unnecessary stress and possible loss of capital.

The proper way to look at TLT in this example is to wait for a real break of the black trend line. Don't get fooled into drawing steep shorter trend lines like the red one I drew here. If you utilized the red as your bottoming indicator you would have had an official break and a higher low as the retest of the low price. Again if you waited for an official close above the swing high (red horizontal line) you would have caught yourself before going long. In the TLT case here, we saw the etf sell off for a couple of days after the failed break.

Again, the best way to avoid mistakes is to have rules when playing a trend change and stick too them. If you only looked to larger more significant trend lines you would still be holding onto your short (if you were short and looking to cover) or you would still be on the sidelines waiting to go long and avoiding any of the short term heat.

In terms of the more meaningful black line trend line break, I think that the three candles that closed above the line are not really a good clean break. First off, my eSignal GET software auto draws elliott waves ... you can see here that it has counted only 3 waves down so we could expect a more than marginal break of the current swing low. Secondly, if you look at the MACD indicator, its two lows were showing only slight positive divergence ... not enough to get excited about and in my experience not usually enough to make a meaningful swing low which we could see a trend change start from.

Conclusion:

Anyways, I hope you learned how I look for trend changes useful. If you can ingrain that "1-2-3" saying in your head when you are looking at possible trend changes, you may save yourself some unnecessary grief and loss of capital.

Cheers ... Leaf_West

Biotech Calendar: FDA Drug Approvals in 2011

http://www.thestreet.com/story/10944267/1/biotech-calendar-fda-drug-approvals-in-2011.html

Sell a put (zz)

• Only sell put options on stocks you want to own. Do not use this on high flyers just to receive the upfront income.
• Only sell enough contracts to stay within your comfort zone. If you normally trade in 500-share blocks, then only sell five option contracts.
• If you are uncomfortable at anytime during the trade, or do not wish to own the stock at the strike price you’ve chosen, then you can unwind the trade at any point. All you have to do is buy back the put options you’ve sold.
• The option price will fluctuate during the course of the trade. It may get cheaper or more expensive while you hold it. The bottom line is – you’ll either get to buy the stock at expiration or the option will expire with no value.

http://www.amazon.com/dp/0735201978?tag=dreamingin0ed-20&camp=213761&creative=393545&linkCode=bpl&creativeASIN=0735201978&adid=08PG0G806RY0AR9FDHND&