General Rules

This is some basic rules that I apply across the board.
One big belief system that I have is that a strategy is not as important as the group of stocks that you play that strategy in.
The main groups of stock I focus on for Long are my Tau Long List, Near All Time Highs, and the Best Performing Industry Groups over the last Month. To make any of these lists the minimum requirements are that the stock trades over the 2 dollar mark and have average volume of at least 350,000 shares.

Tau Long List – This is made up by looking at the best performing stocks over the past 26 weeks and 52 weeks using TC 2007.

All Time High – I get this list from Prophet.net, using there scan for stocks trading Within 2% of Their All Time High.
Best Performing Industry Groups – This is accomplished by using TC 2007 and sorting their Hemscott Industry Groups by the last months performance.
The main groups of stocks that I focus on for shorts are my Tau Short List, Near All Time Shorts, and the Worst Performing Industry Groups over the last Month. To make any of these lists the stock has to trade over the 20 dollar mark and have average volume of at least 350,000 shares.
Tau Short List – This is made up by looking at the worst performing stocks over the past 26 weeks and 52 weeks.
Near All Time Lows – I use Prophet.net for this as well, Within 2% of Their All Time Low.
Worst Performing Industry Groups – I use the same TC 2007 process, just for the worst performing groups.

I will always focus on the higher volatility stocks to trade.
I focus on placing trades on Tuesday, Wensday, and Thursday.
I do not place trades on Friday.
I do not place trades on Fed Meeting days.
I will always keep learning so that I can improve my trading.

Here are some Links to other traders rules:

Commodity Trader

Downtown Trader

Lloyd’s Investment Blog

MaoXian

Move The Markets

Bill Rempel

Technically Speaking

Techicator

Trader X

Trader Feed 

Trader Mike

Tyro Trader

Ugly Chart 

The Chip Plays

 

This is just a bad name for a Pullback play. Here are the Rules:

• Stock is above a flat to rising, rising preferred, 50 day moving average
• The Stock has hit a three month High in the last 10 days
• The Stock is in a Pullback – two or more lower highs
• The stock has positive Chaikin Money Flow
This set up has four types of lies.
The first and the safest play is the Second Chance Chip. This is where a pivot point forms during the pullback. Basing your entry off the pivot high gives you more confirmation that it’s a real move. The down side to this is a wide range between your entry point and your stop. It’s a low risk to low reward type of a set up. Dave Landry calls this play a False Rally Pullbacks.

The second type of set up is called the Naked Chip. The naked closed, which is what Joe Stowell called them. This is simply where the CLOSE of today is less than the Low of yesterday, making it a down day. The play is off the quick change in thinking that can occur during trends.

The third type is referred to as the Cleaner Chip. This set up goes by many names – Trend Knock Out, TKO, Trend Cleaner, Cleaner, ect. This is simply where the stock puts in a large range candle that appears to have triggered several stops, cleaning the way for a continuation of move with the trend.

The fourth is just a Standard Chip. This is basically all other pullbacks, until I name them all! These all work in the short world as well, just flip the rules.

The Lie – Equity Curve Study

The Lie or Account Equity Curve Rules:
How the ball is sitting in golf is very important in understanding what kind of shoot you can hit. Trying to play the wrong shoot in a bad lie can be a study in humility. I will use my Equity Curve to decide my lie or how I’m currently sitting. I will track three simple moving averages around my equity curve, the 5, 10, and 20 simple moving averages, to decide my lie.

Equity Curve is based off Closed Trades.

Fairway: This is the best lie you can ask for. This is when the Equity Curve is above all three moving averages and all three moving averages are going up in the correct order, 5SMA above the rising 10SMA, and the 10SMA is above a rising 20SMA.
During periods when I have a great lie I have the most flexibility in my trading. The big part is that I can take add an extra 20% to my normal risk percent on any trade, and have access to usage of full margin. I can also play any sort of shot or play that I want during these good times.
When the Equity Curve crosses below the 5SMA I am forced to remove the extra risk from my positions, by adjusting the stop or removing the extra shares.

Light Rough: When your in the rough it lets you know that your shot was just a little off course. This happens when the 5SMA crosses under the 10SMA, but is still above the 20SMA. The Equity curve looks like it’s going more sideways than anything else.
During these periods I have my normal Risk Percent with the ability to use only 50% of the margin available to me. I am not allowed to take Drive plays or One Iron Shoots.

Weeds: This type of lie lets you know that your shot was off course by quite a bit. This is the first bad sign that we get with our Equity Curve Study. This happens when the 5SMA drops below the 20SMA.
During these times I start to drop down the amount of risk I can take on a trade. I am only allowed to use 50% of my risk amount. During these times I can only play Second Chance Chip Shoots until I get myself back on track.