maxreturn
745 posts
msg #35035
- Ignore maxreturn |
2/1/2005 8:14:21 AM
I am a newbie to stockfetcher but not to trading stocks. I am working on some filters to capitalize on the volatility of lower priced stocks but have read mixed reviews on trading OTCBB. Would appreciate some feedback from those who have experience trading lower priced stocks as to the pitfalls. Thank you!
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TheRumpledOne
6,411 posts
msg #35038
- Ignore TheRumpledOne |
2/1/2005 12:02:17 PM
Pitfalls...
If you don't manage the trade, you can watch your funds drop 50% or more in a blink of an eye.
If you do manage the trade, you can rake in 5% gains or more daily!
MAY ALL YOUR FILLS BE COMPLETE.
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maxreturn
745 posts
msg #35041
- Ignore maxreturn |
2/1/2005 3:02:47 PM
Thanks rumpled one. A followup question...In doing more research I've discovered that one cannot place a limit order for stocks traded on the OTCBB. My assumption is that the bid-ask spreads can be ridiculous on the more thinly traded stocks but that it would be more manageable on the more heavily traded stocks. From reading your posts I know you're one of the more experienced traders here. Would appreciate your feedback on what the typical bid-ask spreads at given levels of daily volume. What minimum volume levels do you require to trade a stock? thank you!
Chuck
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TheRumpledOne
6,411 posts
msg #35043
- Ignore TheRumpledOne |
2/1/2005 10:50:58 PM
You CAN place limit orders to buy and sell OTCBB stocks.
Volume requirements are personal... more of an art than a science.
You need volume to SELL!
If you have a stock that went up but no buyers, you can't sell.
Some OTCBB stocks may trade 50,000 shares or less for day, weeks, months, then one day, 500,000 shares or more trade hands and next thing you know the price has doubled, tripled or more!
Hint: volume is everything... success leaves clues... people "in the know" load up on the stock BEFORE the price soars... the clue is a VOLUME SPIKE.
If you are trading OTCBB stocks, you better have real time Level II and watch NITE... if they are buying you buy, if they are selling you sell.. if they are out of the money, you should be to... follow the leader down the path to riches.
MAY ALL YOUR FILLS BE COMPLETE.
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maxreturn
745 posts
msg #35047
- Ignore maxreturn |
2/2/2005 9:03:05 AM
Thanks again Rumpled One. My method trades off weekly charts and basically looks for stocks that have been beaten down, the weekly ranges are drying up, and weekly momentum indicators are rising. My filter picked up APYM the week of 11/22/04 just prior to a major advance. Would you mind looking at a weekly chart of APYM? My thinking based on your last post is that I could have probably gotten a decent fill on the buy side but would need to sell on the way up while the volume was still heavy? If your style was to trade of weekly charts the way I do, where have you looked to sell? Many thanks for all your help!
Best Regards
Chuck
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