Day Log

Well we had a little move down today which shoot the $VIX up to an unreal level of 11.51.  I set up an option play betting the volatility would increase between now and January 2007.  Might have been a suckers bet but we’ll see.  Not much happen except the weak got weaker on the 60 minute time frame, going from Yellow to Red.  Took four shorts today that I plan on playing with a ton of spin, tight stops, due to the fact we are still in an uptrend.  These shorts put my portfolio to work at 75% while making my current risk 58% of my allowable level.

Not looking at to many longs here for a second.  I did find a nice Second Chance set up on VIP.  The big problem here is do you believe the breakout, the volume is not backing much here.  But not doing much more than that for now.  Will be focusing on making sure my risk is taken away on my shorts.

The Putts – Day Trade Plays

The Putt Play is some form of a Day Trade. I look for stocks that are having a Breakaway Gap, up on Strong Volume, or hanging around Support or Resistance. I also tend to look for set up’s in the stocks that I’m currently Swing Trading and positive in.

The set ups are fairly standard. I use a 30 minute chart and look for Narrow Range candles or Hammers (Shooting Stars) and play them in the direction of the trend.

I could elaborate on the whole issues but there are people how have already done a great job:

Ugly

Maoxian – and make sure to look at his Trading for Dummies

Estocastica

These guys have a ton of great information on the different styles out there.  I’m more concerned with the groups of stock you put your style to.

The Three Wood Shoot – A Smaller Term Break Out Play

This is a play where you find low volatility on the daily chart and have a clear direction already chosen on the weekly chart. This type of play could form in a number of ways such as aSmall Base or some form of a Triangle. Here is an example:

I still like to play this against my main lists – Tau Longs, Tau Shorts, Near All Time Highs, Near All Time Lows, and best and worst performing groups.

The downside to this play the bad ability for the market to head fake in the opposite direction first before making the true breakout.