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This tutorial was originally titled “Micro Trading for a Living” and was recorded at the New York Online Trading Expo
Micro Trading TacticsWith
Oliver L. Velez
Founder of Pristine.com, and Author of the best selling book, Tools and Tactics for the Master Day Trader
Copyright 2000, Pristine Capital Holdings, Inc.
Pristine.com Presents
Introduction
Basic Intro
Types of Trading
•Four Trading Styles: Core, Swing, Guerilla, Micro
•Two Trading Categories: Wealth & Income
Basic Introduction
Wealth Building•Core Trading –•Covers a holding period of weeks to months.
•This style of trading is the new form of investing.
•The Core Trader typically uses weekly charts, and attempts to capture the entire weekly trend.
•Core Trading is best used on key stock indices (DIA, SPY, QQQ, HHH, etc.).
The Four Trading Styles
Core Trading Chart
Wealth Building•Swing Trading –•Covers a holding period of 2 to 5 trading days.
•This style of trading capitalizes on a very overlooked market niche.
•The Swing Trader typically uses daily charts and attempts to buy the dips and side step the declines.
•Swing Trading can be used on anything that moves.
The Four Trading Styles
Swing Trading Chart
Income Producing•Guerilla Trading –•Covers a holding period of 1 to 2 trading days.
•This style of “hit and run” trading capitalizes on reliable overnight trading patterns.
•The Guerilla Trader typically uses daily and hourly charts and buys/sells late day strength/weakness.
•Guerilla Trading can be used on all vehicles.
The Four Trading Styles
Guerilla Trading Chart
Income Producing•Micro Trading –•Covers a holding period of seconds to hours.
•This style of active trading goes after small but frequent bite-sized gains.
•The Micro Trader typically uses 5- & 15-minute charts and buys/sells dips/rallies, BO/BD.
•Micro Trading can be used on all active stocks.
The Four Trading Styles
Micro Trading Charts
Tools of the Micro Trade
•Charting Tools: 15 & 5-min charts, 20 and 200 period moving averages
•Market Timing Tools: Nasdaq & S&P Futures, NYSE and Nasdaq TICKs, NYSE & Nasdaq TRINs
Micro Trading Tools
Micro
Charting Tools
Charting Tools
Pristine Capital Holdings, Inc.
5-Minute Chart
15-Minute Chart
Pristine Capital Holdings, Inc.
The Power of the 20 & 200 MAs
Micro
Market Timing Tools
Market Timing Tools
S&P and Nasdaq Futures Charts
NYSE & Nasdaq TICK
NYSE & Nasdaq TRIN
The 3 Micro Trading Phases of the Day
1) Phase 1 - 9:30 to 11:15 (Trade BO/ Reversals)
2) Phase 2 - 11:15 to 2:15 (Mid-day Doldrums)
3) Phase 3 - 2:15 to 4:00 (Trade B/O Reversals)
3 Micro Trading Phases
The 3 Phases of the Trading Day
The 3 Phases of the Trading Day
The 3 Phases of the Trading Day
The 9 Micro Trading Reversal Times
Phase 1 Reversal Times - 9:35 10:00, 10:30, 11:15Phase 2 Reversal Times – 12 & 1:30
Phase 3 Reversal Times - 2:30, 3:00, 3:30
Reversal Times
Major Reversal Times
Major Reversal Times
Major Reversal Times
Phase 1 Trading Tactics1) The 9:30 Breakout/Breakdown Play
2) The 10:00 Reversal Play
3) Pristine’s 30-Minute Rule
4) The 11:00 Topping/Bottoming Play
5) The 200 Moving Average Play
Micro Trading Phase 1
9:35 BD and a 10:00 Bottom
9:35 BD, 10:00 Bottom, 11:00 Top
9:35 BD, 10:00 Bottom, 11:00 Top
9:35 BD, 10:00 Bottom, 11:00 Top
9:35 BD, 10:00 Bottom, 11:00 Top
9:35 BD, 10:00 Bottom, 11:00 Top
30-Min Buy, 11:00 Top
30-Min Buy, 11:00 Top
10:00 Top, 10:30 Reversal
200 MA Play at 10:30 Reversal
Phase 2 Trading Tactics1) The 11:00 – 11:15 Topping/Bottoming Play
2) The Good Lunch Play
3) The 15-minute Trading Dip Play
4) The 1:30 Reversal Play
Micro Trading Phase 2
11:00 – 11:15 Topping Play
11:00 – 11:15 Topping Play
The 1:30 Reversal Play
The 15-Minute Trading Dip
1:30 Rev & 15-Minute Dip
11:00 Top and 1:30 Dip
Phase 3 Trading Tactics1) The 3:00 Topping/Bottoming Play
2) 200 Moving Average Play
3) The Late Day Breakout/down Play
Micro Trading Phase 3
3:00 Topping Play
3:00 Topping Play at 200 MA
The Late Day Breakout (LDB)
Prist ine Capital Hold ings, Inc. 7-11 South Broadway, Sui te 210 , Whi te P la ins , NY 10601 Tel: (914) 682 -7613 Fax: (914) 682-7 6 4 0 Web: www.pr is t ine .com E-mail: edi tors@prist ine.com
P E O P L E S O F T I N C ( P S F T ) The Simple Art Of Trading® Part I
Chart Courtesy o f www.Execut ioner .com
5 -M i n u t e C h a r t Note that the Pr is t ine Day Trader b u y s P S F T on the break of the most recent ser ies of equal highs, not on the break of the h igh of the day.
Note how P S F T’s breakout occurred on Above Average Volume.
High of the Day
Our initial protective stop (1) is tight as it is, but the astute Pris t ine Day Trader knows how and when to quickly raise i t to make it even tighter (2).
1
2
Late Day Breakout
Criteria
1) Stock is up on the day
2) Stock is above its opening price
3) Stocks is trading at or near the high of the day
4) Stock breaks out latein the day (anytime after 2:30 EST).
The Late Day Breakout (LDB)
Prist ine Capi ta l Holdings, Inc. 7-11 South Broadway , Su i te 210 , Whi te P la ins , NY 10601 Tel: (914) 682 -7613 F a x : (914 ) 682-7 6 4 0 W e b : www.pr is t ine .com E -mail : ed i tors@pr is t ine .com
B I O M E T I N C ( B M E T ) The S imple Ar t Of Trad ing® Par t I
Chart Courte sy o f www.Execut ioner . com
5 - M i n u t e C h a r t
T h e P r i s t i n e D a y T r a d e r b u y s n e w high .
Note th is near perfect Pr is t ine B u y se tup .
S top
Late Day Breakout
Criteria
1) Stock is up on the day
2) Stock is above its opening price
3) Stocks is trading at or near the high of the day
4) Stock breaks out latein the day (anytime after 2:30 EST).
The Late Day Breakout (LDB)
Prist ine Capita l Hold ings , Inc. 7-11 South Broadway , Su i te 210 , Whi te P la ins , NY 10601 Tel: (914) 682 -7613 F a x : (914 ) 682-7 6 4 0 W e b : www.pr is t ine .com E -mail : ed i tors@pr is t ine .com
S T A P L E S I N C ( S P L S ) The S imple Ar t Of Trad ing® Par t I
C h a r t C o u r t e s y o f w w w . E x e c u t i o n e r . com
5 - M i n u t e C h a r t T h e L a t e D a y B r e a ko u t ( L D B ) t o a n e w d a i l y h igh of fe rs the Pr i s t ine Day Trader an exce l len t m ic ro -t rading opportuni ty , as wel l a s a s t rong overnight t rading poss ib i l i ty .
Late Day Breakout
Criteria
1) Stock is up on the day
2) Stock is above its opening price
3) Stocks is trading at or near the high of the day
4) Stock breaks out latein the day (anytime after 2:30 EST).
The Late Day Breakout (LDB)
Late Day Breakout
Criteria
1) Stock is up on the day
2) Stock is above its opening price
3) Stocks is trading at or near the high of the day
4) Stock breaks out latein the day (anytime after 2:30 EST).
The Late Day Breakout (LDB)
Late Day Breakout
Criteria
1) Stock is up on the day
2) Stock is above its opening price
3) Stocks is trading at or near the high of the day
4) Stock breaks out latein the day (anytime after 2:30 EST).
Tools & Tactics – A Must Read
A Japanese proverb says, “If you wish to know the road, inquire of those who have traveled it.” The authors of Tools and Tactics for the Master Trader clearly know the road. Their unique insights, trading tactics and powerful tools, so enjoyably presented, make this a book that belongs on every trader’s shelf.
Steve Nison, CMT - Author of Japanese Candlestick Charting Techniques