Barb, heres a hint .if a position you're in is for trading not holding long term then set up stops.so when they reach that 5-10% down or whatever you set up that'll be your loss.now thats in a stock thats for trading not one that you absolutely love and will hold forever.

 

Thanks Indianatrukr,  I will do that.  Right now I am mostly just holding, but this winter I plan to do quite a bit of trading and I will certainly keep this in mind.

 

Thanks GCMan, I have heard many good traders on here mention volume, accumulation, and distribution but no one really ever explained how it applied and this is one question I never did ask.

When I first started trying to learn I asked so many question I was dubbed the questionmonger. LOL

No such thing as too many questions in my book. Jesse Livermore refused to write about his approach to the markets for the longest time because most of the people he talked with jut wanted to just be given a stock tip and did not act on it when he did give one out. Only later in his life did he decide to write his book "How to trade stocks", because although he ran into so many that wanted to make the easy quick dollar he did realize that there were the minority who would take his ideas and really learn it and treat it like a business. So ask away. I gave you a very condensed version of volume to get you interested. If you looked at the charts I gave as an example you should be pretty interested in volume at this point. So really go out and try to find how you can see the clues the institutions are leaving behind on the stock charts, take a psotion and let them move te stock you own for you either up or down.

OK, thanks a lot,   I am going to give this a try.  I feel a bit like Alice in Wonderland when it comes to volumes telling the story even though your explanation makes perfect sense.    But maybe trying to apply it will let the concept soak in if there is enough room left up there. lol

 

 

   GCman  BAC  Bank of America volume Friday was 336,814,489   and below is average volume.     Does this say something ?

Average Volume (3 month)3:	237,096,000
Average Volume (10 day)3:	182,574,000

Yes - now this is a tricky day because the day ended with the close higher than the open and on the upper end of the days range, which usually means there was accumulation at the lows.  But the day also closed down on the stock on big volume with a Gap.  Because it found accumulation it may go fill that Gap but because of the number of ditribution days within the month this stock is headed down.  Unless  of course there is a 2% gain in one day on large volume,  Then that would negate the distribution days.

OK, so if I am understanding correctly if I wanted to buy this stock I would look for a 2% gain in one day on large volume ?

I am still struggling with how to recognize accumulation and distribution,  I will go back and read your first post about this again.

I thought I had it down, but then when I tried it out, I found I was a bit confused. 

 BTW,  thanks for your patience and efforts on this for me.

 

Barbara, You are correct you would look for a day with a 25% or greater gain with volume that is larger than the day before. Personally I look for 50% more volume or close to that. For example the S&P had a go ahead buy signal early October so while that was in place I only look for stocks that are going up in price, but yesterday we had a distribution day that fits into the scenario I discribed earlier. So now I will only look for stocks with the potential of going down for a short opportunity until one of the index funds S&P, NASDAQ or DOW have a follow trhough day of 1 to 2% on higer volume. So I use the larger market as the indicator of what I should look for. Remember it doesnt mean there wont be movement in the other direction, that is expected so if the general market is up and stocks fall on lighter volume you look for an entry point to go long. It takes some practice and you have to make your own rules when it comes to which stocks to buy, for example If there are 10 stocks that had a 2% gain on large volume I will look at each and depending on where the stock is in a pattern, day range compared to volume etc. to decide which is the best pick. As in everything there is not a 100% guarantee so that is where stock trading goes from a science to an Art. It truly is both.

Would a distribution day be the same thing as what I call a sell-off day where the market just generally drops and an accumulation day the opposite where the market generally goes up,  or are there other factors to consider ?

A distribution day is not just a down day, it has to have larger volume than the day before. An Accumulation day is an up day with larger volume. But remember for a market or stock that shows it wants to go up we are looking for more than an accumulation day. We are looking for a day where an index has gone up 1% to 2% on larger volume. In a regular stock it needs to be 2% on 50% greater volume. I want you to notice my posting yesterday. I noticed the 5th Distribution day in the S&P Index so I said I was no longer looking for stocks to go up but for stocks to short. So yesterday when everyone was jumping on the buying bandwagon in the early part of the day I was looking for stocks to short. See what an advantage that gave me when 3:11pm hit and the market dropped like a rock, I was not surprised by the sudden fall I was actually waiting for it. I will now continue to look for stocks to short until one of the indexs gives me that signal that the general market wants to go up. This type of trading takes out all prediction, meaning I wont predict to tell you that next week the market will be up or down, but at the close of each day I know the General market direction and whether it has changed or not. So I allow the market to tell me what it wants to do insead of looking into a crystal ball and hoping for the best.

OK,  this is great, now I understand fully I believe.

Where do you go to check the overall volume for each day?

  I know how to check volume of course on individual stocks and I have looked at volatility indexes, but I have never looked for overall or average volume on trading for each day.

@ Barbara Jones:

If you search Yahoo Finance and go to their home page you will see a market summary (top left) that shows the DJIA, NASDAQ and S&P.

If you click on the link you will go to a chart for that index.

From that page click on “Historical Prices” in the navigation on the left, that will give you opening and closing prices. You can even download them into a spread sheet.

@ GCMan:

Wow this is exactly the type of information I have been searching for. Thank You for your time on this thread. At the risk of getting my own nickname I do have a few questions.

If one of the indexes moves into distribution, are you short all stocks or just the stocks in the index that moved into distribution?

If I understand correctly distribution/accumulation for a single stock is signaled by 3-5 days within a month, but for an index aleays 5 days?

Thanks again.
 

 You have to see how the index moves into the distribution.  If it moves in on a follow through day you want to be long. If it moves into that area you want to look for a short entry or be in cash.  I hope I am interpreting your question right.  Rememebr there are some stocks that go up when the market goes down and vise versa so it is hardly ever ALL stocks.  look for the ones that are following the same price patterns as the index.

  Thanks for the great info.

I got an email saying that profit taking is to be expected right at the first of January and there will be some great buys on some good stocks .

 

 What do you think ?

 Well if you follow yearly cycles you will notice that December is not currentlymoving to the norm.  There is still time but normally the markets are driven up in December so yearly performance looks better.  that has not happened yet and the years where that does not happen normally the next january is not a good month.

 Sorry .... that just aint in the cards.

With the $ dropping like crazy and the Fed printing like crazy ...... the NYSE stocks will keep rising. A quick look at the A/D and Hi/Lo charts ought clue you in as to where these prices are going.

Unfortunately, the $ will keep going down, so that anyone who is trying to preserve their buying power is in a lose lose situation if they invest in stocks.

Either spend your money on booze or gals, or convert it into physical gold and silver. 

There's a good chance that the markets will be shut down before the powers that be would allow them to go crash.

 No one said anything about a crash. But the market is set for a pull back of some type here unless they can rally it up in the last couple of week of December.

 market is trading in the 1090-1110 for a while. It could go either way from here and I think, indeed, is going to be wild. Don't be so sure is going to crash

liar

liar