Poz broad tone, never a down day … CIFS TTNP KNDI UXIN … ACHV day two down 24% 9,600 trades, 181,000 last Friday, lol. Notes on charts.
Trading Notes -- 20190222 Friday
Poz broad tone (predictably, can’t have two down days in a row, been the case for months now) … ACHV the HTB du jour and the only game in town … all ZSAN losses recoupable but only if you acted off of PO difangs, no spot in regular hours, and they triggered SSR early, the dirty bastards … finally stopped out of DBD, crazy to hold it that long but better than monkeying with the original stop. KNDI the clown car company still holding up… it’s either going to go to new highs or collapse, take your pick.
Trading Notes -- 20190221 Thursday
Slightly negative tone (don’t worry, it’ll go up again tomorrow) … ZSAN all-day runner, Killer of Flying Pig Players, KNDI, ADIL, CREG … notes on charts.
Trading Notes -- 20190220 Wednesday
Poz tone for the SPY yet again. Never a down day, for months now. PO HTBs KNDI, CLSD, RIOT … interestingly IB had a few shares of KNDI and CLSD which I anticipated would all be pre-borrowed and was correct about … RIOT is full red unshortable … KNDI squeezed all morning and into 13:30 and I shorted C&B and eventually A off of PO difangs, IB gave me a very nice fill on the A since they ran out of borrows in the morning then found some in the afternoon and filled me right then (near top tick of course) … would have been awkward if I wanted to add at C1 and had no shares available, woulda been a major bummer but it didn’t happen. KNDI has had a $300M shelf in effect for a year and a half now and this NHTSA approval the perfect spot for them to sell into, but we’ll see. Able to carry since not paying 7x for the overnight barrow, ha! CLSD a little more straightforward, shorted C&B and could have added A but they ran out of borrow (didn’t pre-borrow enough, same as KNDI), woulda been near top tick (of course) but I’m fine with this ave and will hold into a StuckAtaProfit day(s) and eventually cover out for the expected gain (he says confidently (hopefully?)) … they did find 20K more shares after hours, but we’ll see about adding them, probably won’t.
Movies Watched -- Custody (2018)
In French. 93 minutes, so the right length, but so grim I had to watch it at 1.5x ffwd. Custody battle, 11-year-old boy and his teenage sister caught in the middle. Father, a hulking brute, is menacing in a Tony Soprano-ish way. Doesn't have a good relationship with his own old man, gets thrown out. Ugly biz. Father snaps in the end. Miserable, who wants to watch this kind of thing? Not a thriller, don't know why it's categorized that way. Yellow rating at best.
Don’t hit Mom (or me)!
Trading Notes -- 20190219 Tuesday
Broad tone poz, god forbid there’s a down day and never ever two in a row…. PO HTBs: SKYS ORPN ARTW … shorted SKYS (0.18 borrow) at PO C covered half at minC, didn’t hit Typ3 before close, wasn’t going to carry at 7x cost, SKYS was only FIDO in morning though of course crowded out by day end … RIOT full red at IB came alive (latecomer) given BTC rally, put in big run, gave many good spots (secondary and even tertiary), RIOT FIDO #14 EOD predictably, ARTW C&B possible, minC and Typ3 reached during day, ditto for ORPN though ORPN did a vicious squeeze first, woulda had to be secondary entries .. XNET another old BTC play back to life, IB has 2.5MM shares so I’ll stay away :) … good day, very solid trading, coulda been very big if not under PDT, money will be sent this week or next (he says hopefully). Still have two old positions (PYX, DBD) yet to stop out but looks like they will … once those are clear, I can switch 100% to bookie broker.
Movies Watched -- Molly's Game (2018)
140 minutes long so at least 40 minutes too long… way, way, way too long. Written and directed by Aaron Sorkin, a sympathetic view of Molly Bloom, a woman who ran an underground poker game for a number of years, first in LA and then in NYC. Starred Jessica Chestain, er, Chastain and her chest and cheekbones, and Kevin Costner as her pushy Jewish dad, Larry, which didn’t work for me. They also invented a gorgeous black lawyer (Idris Elba) who worked pro bono for her, which was weird but par for the course for Hollywood.
Only really interesting part was when the Italian mob beat her up after she rejected their offer of debt collection and protection. Could she really have been that naive? Also interesting was how she recruited players by paying off casino floor men and cocktail hostesses. Some cheap psychobabble about Daddy Issues and needing to have power over powerful men. Why not just say she was greedy, liked partying, and didn’t have the good sense to quit while she was ahead?
I think Sorkin likes these Wayward Jew stories and wants to create his own version of history. Wouldn’t have been terrible if they made it 90 minutes long, but as it is, it’s a red, avoid.
Mick Lasalle gets it right: “Sorkin takes a sordid, morally muddled anecdote and inflates it with an importance it doesn’t deserve and can’t sustain … Sorkin’s default, when in doubt, is to steamroll the audience with dialogue.“
Just a really ambitious librarian who liked snorting coke
Drowning In My Own Tears
Pierino at age 67 covering Stevie … a certain Lawrence Welkian feel … not crying in his beer:
Notes for Chat with Traders, Episode 171
Episode 171 -- Stan Gluzman (77:46)
Doesn't trade the close anymore
The close used to be his go-to time, but not anymore
Doesn't hold overnight
Biggest position on by 9:45 AM, trades around core until 11 AM, usually flat by noon
Things are mispriced in the morning, but fairly priced by noon
Forgets tickers shortly after he's done trading them
Aaron mentions Stan's CLRO trade from morning of recording
Looks at VWAP
Tries to short near top, covers half on washout, re-shorts the next pop, covers wash, etc.
All chat rooms watch the same stock, pump it multiple times throughout the day
Trading full-time 4.5 years, another 1.5 years part-time before then while in college
Started in 2013 when in college, made 30% on a $5 stock in two days, "bitten by the bug"
Started studying trading on his own while still in college, joined chat rooms, bought DVDs
Locked himself in his room and "started blowing up accounts" in 2014
Realized he needed to be surrounded by professionals, joined prop firm in 2015
Was a breakeven trader when he joined the prop firm, before accounting for commissions
Undercapitalized, so commissions made him a net loser despite breaking even on trades
At prop firm he first learned how to scalp for half a penny trading millions of shares
Read on a forum that a good prop firm doesn't take your money, no capital contribution
Seven Points Capital office right next to his college
Seven Points doesn't require capital contribution, charges no commissions
Seven Points wanted people who were teachable and passionate about trading
Advantage of being prop trader versus retail trader: "like working out in a high-end gym with a personal trainer versus working out in your backyard with buckets of water"
In prop you're trading other people's money, not your own, so no psychological pressure
Routes are important, has access to ten dark pools, six aggregators, plus all the exchanges
Have to figure out how to jump the queue by figuring out which dark pool is actually buying or selling
Has 150 (?!?) hot keys set up
Most used hot key, "F2" short the bid [I laughed]
Uses scroll wheel to select position size
Mike Katz was his first real mentor
Mike Katz always keeps his eyes open, in the right places at the right times, on his toes
Red two days in a row? Try to figure out the error
When losing money, he sizes down, divides his daily lockout dollar loss by four
Got his first paycheck five months in at Seven Points Capital, been sizing up ever since
2015 his first full profitable year
In 2016 he traded 260,000,000 shares, more than a million shares a day scalping [no commissions key?]
First time he lost $1,000 was a shock, but as he sized up, it became a regular sized hit, no longer hurt
In 2016 he would take advantage of inefficient algorithms, "short the offer, cover the mid"
In 2016, Sprint (S), Sirius (SIRI), Ford (F) were ticker symbols he'd trade: high volume, small range
Short the offer, saw offer was about to lift, would cover the offer or cover at the bid once it flipped up
96% success rate doing the kind of scalping, but that was 2016, can't do this anymore
Can gauge "Book Pressure" by watching the tape
Algos didn't care about book pressure, it would just execute at some regular interval
Could spot the algo because the same price and quantity was printing at a regular interval
Midpoint is price between bid and offer, there is "invisible" liquidity there, "peg to midpoint"
BYX is his preferred route for the midpoint
"Can't get the bid, go for the mid"
Crappy little penny stocks are volatile and retail-driven, small order sizes, not scalpable with size
Switched from scalping stocks like Sprint to scalping SSR (short sale restriction) stocks
Using his superior routing skills, he could short SSR stocks at the mid as they fell
Most people are at the offer or the bid, they don't even know about the mid
Gives example from his SSR trading that day: one gain was five cents, other gain was 35 cents -- "scalpy"
SSR strategy just a tool in his toolbox now, the edge has sort of disappeared
Small-cap stocks gap up and fail, a "fader" [no mention of locate fees, alas]
Small caps are volatile, full of dumb money: newbies plus true believers
Also trades big cap stocks on earnings days
Small cap stocks gap up for a lot of reasons, usually a press release
Uses gap scanner, filters by float and market cap, less than 100 million share float, usually under 20 million
Uses multiple entries and multiple exits ... this is the secret to his success
Takes 1/4 position at point he thinks is the top, if wrong he just loses 1/4; if he's right, he adds as it falls
Scalps half his position and holds half for the all day fade
If he thinks he's right, and a big bid appears, he'll smash the bid
You'll never pick the top or the bottom, you always have to scale in and out
Give yourself room to be right
If stock drops sharply, will take off a quarter, drops sharply again, will take off another quarter
After every sharp drop he covers, then re-shorts the bounce if it happens
Has a set risk amount on every trade that he's willing to lose
When he doesn't follow that set risk amount, "gets stubborn," he takes his biggest losses
"Do you want to make money, or do you want to be right?"
Tracks performance of his setups: size of float, size of gap, time of topping out, pre-market volume, etc.
Has created "money box" ranges where he expects stocks to top out or bottom out
Visualizes the "money box" on his charts
Learned how to code to create the "money box" visual indicator on his charts
Stocks that continue to squeeze up are outliers
Tries to line up fundamental reasons, tape reading, basic technical analysis, on every position
Learned about volume forecasting from AllDayFaders
Idea is to forecast volume to predict if price will fade or squeeze during the day
Unusual demand leads to squeezes
Stan doesn't want to get a job, so he trades for a living [chuckling]
June 2018 he had a red month, it was rough, he pulled a lot of all-nighters
Learned a ton from JTrader, who helped him get through June slump
Mike Mangieri encouraged him, had his back despite the losses
NYC is expensive and the weather isn't great, so he left for Florida (also taxes too high in NY)
Set up Ft. Lauderdale office with Krishna Joshi
Has three other traders on the desk in Ft. Lauderdale, plus one studying for his license
New traders shadow him for a couple of weeks, can figure things out more quickly that way
Records his screen every day, posts it to group intranet so colleagues can study
Eliminate mistakes, don't repeat the same mistakes
Being fearful when entering a trade is a mistake to be worked on
Sized up in 2018 and wasn't as consistent as 2017
Goal for 2019 is to find balance between taking full-size positions and not shooting for home runs (holding too long)
Added many new setups to his toolbox in 2018
"If the market changes, I will adapt."
Twitter: @ciocanatrader
Trading Notes -- 20190215 Friday
SAEX, SKYS, APHA, SOLO, DUV, CYBR, ARRY, DBD, PYX … poz broad tone, can’t have down day anymore, not allowed, comments in charts below:
