Monday, February 21, 2005

My Typical Trading Day Routine

I believe routines are important when seeking consistent results or evaluating performance. By following a routine, a trader can get involved in the process of trading each day, rather than getting wrapped up in analyzing results. Evaluating results certainly has its place, but it can be a hindrance to trading your best from day to day.

My routine begins in the morning about 90 minutes prior to the opening bell. I come into my home office and get my computers up and running. I have 3 PC’s and 4 screens which I use each day. I take a look at the news and see what headlines may have an effect on the day’s open (CNN.com), as well as what stocks may be in play due to news on them (updated throughout the day at Briefing.com’s In Play page available from my CyberTrader brokerage account). I then start to load up my watch lists into quote windows, as well as into my Real-Time Streaming Stock Alerts windows. I use Trade-Ideas Pro, which alerts me the moment stocks hit new highs or lows, or any of a number of other criteria are met. It also helps me search for patterns or volume moves intraday, which I find useful for daytrades.

Once I have loaded those lists, I then turn to my primary brokerage account which is CyberTrader. I use the CyberTrader Pro platform, which has every tool I have ever needed to execute trades and monitor positions. I use the Market View windows for quote lists, but my favorite feature of this direct-access trading platform is their conditional alerts feature. So during the premarket, I set conditional alerts for my swing trading newsletter picks, by using time, bid/ask, and price conditions. I can set these to automatically generate live orders once they trigger, or simply to alert me once the conditions are met. I generally set them to get me into at least a partial position, and then I will monitor the pilot position and add to it as I see fit. Once I am in the positions, I then set automatic exit alerts as stop-loss orders to close out the trade for me if needed. This not only saves me valuable time, but it allows me to focus on remaining positions rather than second-guess whether or not I should exit. Let me say that many more times than not I am quite glad to have had an automatic stop order generated for me using these conditional alerts! Nothing is worse in trading than fighting a losing position and regretting not getting out at the originally planned stop-loss price. These alerts take that possibility out of play for me, and let me keep trading and looking for the next move.

Throughout the day, I keep tabs on the market in a few ways. I read some financial websites such as RealMoney to keep me aware of current and upcoming events, and it is always good to read trading articles from other traders. I also am on instant messenger with a few other traders which I have worked with for several years. We work well looking for intraday setups together better than any of us might do individually. As long as you can stay focused on the market and not get sidetracked discussing other topics, this is a good way to trade. I have never looked at other traders as competition, but rather as helpful resources to share ideas with and seek out new ways to profit. It also gives me interaction with people which is good when trading in a home office. A trading chat room can be helpful (but sometimes expensive) when looking for others to share ideas with, but I am not a member of any.

I probably place about 20 round-trip trades per day on average. I will keep stocks overnight, but I also daytrade. I don’t let commissions deter me from entering new trades, because they have become so cheap that only a very small move in the stock can more than pay for the commission. If I feel the market is on the move, I will become more aggressive in adding to open positions or seeking new ones. If the market is slow-moving and range-bound, I am reluctant to add new positions unless they are for swing trading.

Once the closing bell sounds, I get away from the computer fairly quickly. I do not stick around for earnings, as I never hold stocks going into the announcements. After staring at my screens so long, I want to get out of the house! About 90 minutes after the close, I begin my research and scan for stocks using my stock charting software. I run scans for custom criteria to narrow down the list, but primarily I am manually scrolling through hundreds of charts looking for chart patterns I like. This process takes well over an hour, and then I begin to compose my swing trading newsletter. The newsletter takes another hour, and then I publish it to my website and email it to subscribers. Now I have my swing trading candidates for the following day as well as some potential daytrades which I may have found while scanning the universe of stocks.

Finally my work is done for the day, and I can eat dinner and kick back for some serious reality TV! If you don’t have a DVR or TIVO, I highly recommend getting one!

Follow a regular routine and you will soon learn what things are most important to your own trading process.

Good night, and trade well tomorrow!

The Stock Bandit
http://www.thestockbandit.com/
thestockbandit@thestockbandit.com

7 Comments:

Anonymous Anonymous said...

Great post! Trading is a lonely profession and it's great to see how other traders have set up their routine (even though I must say I am surprised at the 20 round trades per day!) wow! Thanks for the info Bandit.

7:03 PM  
Anonymous Anonymous said...

SB: How long do you usually hold a typical trade : daytrade for ex -- usually several hours or 10 minutes -- on average; and swing trade on average -- 2-5 days or longer?

I find that if I try to get in and out too quickly of a trade I just get chewed out. Patience is key in this profession.

7:10 PM  
Blogger The Stock Bandit said...

Thank you for the comments. I usually am in daytrades for at least an hour, depending on how well it works. If I am wrong, it could be as brief as just a few minutes. For swing trades, I will hold them until my target or stop is reached, or until I no longer like the trade setup. This is usually around a week, again depending on how well the trade works. You are correct, patience can pay off!

Thank you,

The Stock Bandit
thestockbandit@thestockbandit.com

8:20 PM  
Anonymous Anonymous said...

Mr Stock Bandit: any way you would consider maybe doing an abbreviated newsletter (don't even need to do charts, just a couple stocks you are looking at with pivots) for Fridays? A lot of big rallys on Fridays lately. It would be fantastic if you could do it.

1:29 PM  
Blogger The Stock Bandit said...

Thank you for your comments, I will consider them. Perhaps from time to time I can send out a brief email listing a few stocks which are on my watch list for Fridays. Watch for a handful of highlighted stocks (may not have charts attached) on Thursday nights on occasion going forward.

2:44 PM  
Anonymous Anonymous said...

We couldn't ask for anything more! That would be fantastic -- just a couple tickers with pivots, no need for charts, once in a while when you think market might move. Thanks for always taking feedback into account.

3:10 PM  
Blogger RICLAND said...

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4:05 PM  

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