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Frequently Asked Questions |
Nebadawn, Inc. |
 What conditions trigger a trade? Night-Trades are all stocks that are severely oversold using several momentum indicators and are trading just above a qualified support line. These are very oversold stocks with a good reason to bounce. The trades will be sold in a few days and are not long term investments.
Is the Night-Trades scan in Ramp?
No. The night trades scan is proprietary and is not in the Ramp program. Can I use Ramp to find my own Night-Trades? The Night-Trades scan is not in Ramp but you can do a BobCharts support line scan and select the stocks with extreme downward momentum. There is a lot more to it than that, but this is the general pattern for Night-Trades. How can I avoid draw down periods? You can use Limit Orders instead of Market orders. The draw down periods tend to be shorter and flat with limit orders. The low the limit order the better and of course the fewer trades you will get filled. Try a 5% below the close limit order to greatly improve the results. Do you provide any commentary? I may occasionally make a comment but this is unusual. Do you publish trading results using Night-Trades. The Night-Trades results, using market orders for the previous 250 trading days, are updated and published every day. I may not do all of these trades myself but I try to. Sometimes I'm not filled because I like to use limit orders or I may be traveling and not trading. How do I handle money management with a larger number of trades? When there is a large number of trades on a given day, the market is oversold and a rally is immanent. Statistically the more profitable trades are on days with 10 or more buys. I like to trade the same dollar amount on every trade so that the results are not skewed. Putting your entire capital in one or two trades in a Night-Trades slow period is a very bad idea. You will be taking larger risk when the market is not oversold. You are much better off to keep a fixed trade size for all trades.
Does Night-Trades use stop losses? There are two possibilities. One is that the stock closing price continues to trade above this level. The second possibility is that it closes below this price. If the stock stays above this level, the system exits using a 6-1-1 stochastic. As soon as the 6-1-1 stochastic has risen 50% it sells at market on the next open. You can also sell when the 6-1-1 stochastic is above 80. This is easy and works just as well. If the stock closes below the support level, the system red flags the stock for sale. To sell this red flagged stock, it holds it until there is an up day. That is, that the closing price is greater than the day before. As soon as this happens, the system tells you to sell the stock at market the next morning. I have found that even though I take a few large losses doing this, statistically, the wins from waiting it out are well worth it.
Do you have a system that buys stocks after they have
started back up?
Night-Trades buys stocks as they are falling. I have experimented with systems that buy stocks after the fall and as they have traded back up a little. I found this to be a very difficult way to make a profit. It was a dramatic difference and the profits go to the buyer who bought before the rally. |