StockFetcher Forums · Filter Exchange · Oops Pattern at the following website<< >>Post Follow-up
ham1198
172 posts
msg #47302
Ignore ham1198
10/3/2006 7:08:49 PM

I came across a well written swing strategy called the Oops Pattern at the following website:
http://www.guerillatradingnation.co...stockpicks.html

http://www.guerillatradingnation.com/OOPSdaytradingstockpicks.html

Introduction
The OOPS pattern is by far one of my favorite swing trading patterns. First it has an accuracy rate of 70%, which combined to good money management, packs a serious punch.

The great thing about this pattern is that it can be used to seriously grow an account. The NASD pattern day trading rule imposes serious limitations on accounts with less than 25000$. Basically, if you execute 4 or more day trading transaction in any 5 consecutive business days, you will be marked as a pattern day trader and will need to bring your account to 25000$ in order to execute any more transactions.

The solution for those that do not have 25000$ but still want to partake in day trading stocks, although in a limited fashion, is to work learn the OOPS setup. You take 1 signal per day for a maximum of 3 per week. You paper trade the rest to get even more familiar with the setup.

The advantage of this is three fold. First you will only need to follow the market for the first hour or so of the day. This leaves the rest of the day for running a business or having a job which of course will provide income to live on as well as investment capital.

Second, this will provide you with the discipline to trade only high probability setups. This discipline will serve for the rest of your trading career and is one of the most important skills of a trader.

Third, it will provide you with a daily routine to execute in order to find and research the OOPS stocks that will be played the next day. Having a routine that produces consistent winning stock picks for your system indicates that you are running your trading career as a business instead of a disorganized feel good gambling habit.

The Setup
I will be going through the buy setup, the short setup is the opposite. The criteria indicated below describes a perfect setup where everything aligns in the right direction. Sometimes, you will be playing imperfect setups, based on your experience of what the entire market is doing and perhaps other factors. To begin though, stick with the perfect setup until you learn it well and are very comfortable with it.

We are looking for stocks that have been in an upward trend but have experienced a recent pullback. We need the stocks to be in an upward trend because this indicates that the stock is under accumulation. There is interest out there. Very often, when institutions accumulate stocks, they will pause, and even sell, for several days in order to shake out the small investors and avoid the price running away from them.

Letís define the kind of stock that we are looking for:

Average daily volume > 0.5M Shares
Share price > 20$
Second we are looking for up trending stocks:

Above the 50 day MA
Preferably above the 20 day MA
The 50 day MA must be pointing upward
Third the stock has experienced a recent downturn. Here is what it should look like:



Notice that there are 3 down days. It is very important that the last day be a wide range bar (WRB), meaning, a bar wider than usual, that closes at the low, or very close to the low of the day. You could also look at 2 down days but it is important that the last day be a WRB.

What has happened here? Over the past 2 or 3 days every investor and traders that were not solid have gotten shaken out. The last day particularly has gone down so much more than usual that investors have become fearful and either have, or are on the point of getting from under the stock. Market makers have shorted all the way down as they must make a market in the securities and buyers are getting rare.

The next morning we are expecting a small gap as the market makers make a last ditch attempt at shaking the trees at a good price and the last of the fearful investors get out.. Once the selling is complete, we expect the price to slowly go up as institutions start buying and market makers cover their shorts.

This is when we get in for a move that could last anywhere from 1 day to 8 or more. Hereís what the chart will look like:




We will buy as the price advances above the close of the previous day. Simultaneously, set a stop under the current dayís low.

In this setup, I will trail my stops while letting the stock run as much as possible. How to trail stops is beyond the scope of this article however, your first profit target should be the first previous resistance. Remove at least some of the position at that point. If you have a small account and cannot afford to do too many trades because of the pattern day trader requirements, exit totally or, at the very least, move your stop to breakeven if the move is strong and the market is also going in your direction. Remember that your goal is to make small consistent profits not to always go for a home run.

Now here is my stockfetcher filter:
Show stocks where Close has been decreasing over the last 3 days
and where day point range reached a new 3 day high
and Price is Above MA(20)
and Price is Above MA(50)
and average volume(90) is > 500000
and close > 20
and average volume(3) is below average volume(3) 3 days ago
and OBV(30) is above Average OBV(30)
and 60 day slope of the close greater than 0
and 200 day slope of the close greater than 0
and rsi(2) is below 30

Any refinement would be greatly appreciated. TIA


luc1grunt
622 posts
msg #47303
Ignore luc1grunt
10/3/2006 7:35:03 PM

RSI2 below 30 may need adjusted to 20 or less. I use RSI2 at 90 for shorts along with other variables and the success of (in that case) 90 is far more consistent than 70 or 80. It still returns a good selection as well. My humble $.02


psheridan050
52 posts
msg #47311
Ignore psheridan050
10/4/2006 8:14:31 AM

Wow, this filter seemes to work out pretty good. i made some slight changes to it to suit my needs. Not a huge amount of picks per year (about 100) but has a net change of 1%. I backtested it for 2 years and it did alright. Thanks for posting it.

Show stocks where Close has been decreasing over the last 3 days
and where day point range reached a new 3 day high
and Price is Above MA(20)
and Price is Above MA(50)
and average volume(90) is > 1000000
and close is between 5.5 and 32
and average volume(4) is below average volume(4) 3 days ago
and OBV(30) is above Average OBV(30)
and 60 day slope of the close greater than 0
and 200 day slope of the close greater than 0
and rsi(2) is below 14



killertrader
18 posts
msg #47432
Ignore killertrader
10/12/2006 1:11:36 PM

Thanks for this filter and method. I've had great results with it as long as I trade it exactly as prescribed and don't try to overanalyze or "cowboy" it. Best of luck.

KillerT


ashraf999
33 posts
msg #47447
Ignore ashraf999
10/13/2006 12:07:27 PM

ham1198,

That seems to be a good swing strategy. It is amazing to see alot of greens when you offset your filter 2-5 days. Thanks for sharing.


radovan.arendas
41 posts
msg #47449
Ignore radovan.arendas
10/13/2006 1:45:23 PM

ashraf999
- Ignore ashraf999
- Report offensive post 10/13/2006 12:07:27 PM

ham1198,

That seems to be a good swing strategy. It is amazing to see alot of greens when you offset your filter 2-5 days. Thanks for sharing.
_________________________________

ashraf999
don't forget that market moved up now. Look what was performance during bearish market


ashraf999
33 posts
msg #47454
Ignore ashraf999
10/13/2006 8:43:01 PM

I understand that swing trading strategies can be implemented in all markets - bullish or bearish. Isn't that right?


ham1198
172 posts
msg #47491
Ignore ham1198
10/16/2006 8:03:19 AM

...glad to see some of you have found good results with the filter. I can't take much credit because i was working with someone elses's thought's. i was hoping the master, tro, would throw some of his expert programming into the filter and we'd have truly found our holy grail.

ot: tro, how far is your ranch from that golf course development in brandon? i heard those course's are a golfer's dream. the developer, mike kaiser, built his 1st course by me and it's a 9 hole dream, plays like 18 due to 2 set of tee boxws. it seems his courses might have increased the value of your land.


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