Friday, September 22, 2006

Trade of the Day - SanDisk Corporation (Public, NASDAQ:SNDK)

As per last night's watch list, both FLSH and SNDK took a tumble on the open. The move happened so fast, it was hard to get in. I switched over to the five minute timeframe to get a better picture of how SNDK was consolidating its gap down and I was able to establish a fairly low risk trading range shortly after the open. The stock consolidated for about twenty minutes before crashing again. The move was swift and on very high volume. I thought that it had capitulated so I covered my entire position right away. The rest of the session was extremely narrow range and both stocks closed near their lows. I only managed the one trade as it would have been too hard to try to get in both at the same time. If you compare both charts side by side, you will notice that they traded like twins.

11 comments:

Terry Carriker said...

Thanks Jamie,
I made 2.3% on this trade today.

Terry

Jamie said...

You're welcome terry. Congrats - you caught a nice piece of the move.

acceltrader said...

Jamie-

You mentioned you only watch 50 stocks....How do you scan charts (howmany etc.) in evening to make that list?

How about max. number of trades you'll enter? Thanks. You have a nice, well thought out blog...
Acceltrader

Glenn said...

It's like you have a crystal ball Jamie. Nice job as usual.

Jamie said...

Hi acceltrader,

Thanks for the kind words.

I have 50 or more stocks in my esignal watch list. Basically this is a core list of stocks that does not change too much over time. It includes my favorites as well as bellwether stocks. My criteria for picking stocks is based on volume and trending on a long term view. I like highly liquid stocks (ADV of 2M or more). I review this list every night looking for potential breakouts.

In addition to the basic list, I sometimes run scans using both Trade-Ideas and stockcharts.com to look for high probability setups as well as intraday gappers. Gappers are good because they attract a lot of volume.

My list of 50 includes the stocks that I consistently make the most money with. In the last 6-8 months these are (in no particular order): AKAM, NVDA, AAPL, CKFR, CTXS, BRCM, GENZ, LRCX, RIMM, TZOO, FFIV. I recently added JOYG to my list as it showed up on an intraday gapper scan on August 31st.

A quick review of this week's watch lists and trades, shows that all of my trading and setups came from my core list of 50 stocks.

On average I trade 2-3 positions per day. I try not to force a trade if it doesn't meet my criteria, but sometimes I can't help myself.

Jamie said...

Hey Glenn,

I wish I had a crystal ball, but basically I rely on chart patterns that have been tried and true in the past.

Anonymous said...

Thanks for your clean and precise blogsite

Jamie said...

You're welcome anonymous, and thanks for visiting.

Anonymous said...

Got both. Two different accounts. Two different computers. About the same entry and exits as you show.

You are my favorite trader. :-)

Thanks
Bob

Jamie said...

Thanks Bob!

Sounds like you have quite a setup there.

Jamie said...

Addendum to this post:

My friends at High Chart Patterns dicretely let know that the reason that FLSH and SNDK traded in the same manner yesterday, was because SNDK bought FLSH.

So, I stand corrected, they didn't trade like twins, they traded like newlyweds and the honeymoon is over already! ;)