QQQ Trading - Newbie Question
Q: There appears to be a number of companies which provide timing advice for trading the QQQ. Examples are: TimingCube - www.timingcube.com TripleQTrading - www.hypertracker.com QQQ Trading System - www.qqq-trading-system.com Nemy Partners - Timing the QQQ - www.easytradingsystem.com Does anybody have any experience of using them, either good or bad?
A:
First off, let me say, I have never used any of the service you have
listed. I am not a professional trader, but I have been trading
stocks for many years, first for profit and now as a hobby. I watch
the market almost every trading day, and make probably 200 to 300
trades a year.
Now that you know who I am, here is my advice. You
subscription would cost) would be better spent on some good books, i.e.
Technical Analysis, or a good book on Hedging, or maybe Risk
Management.
Over the years, I have looked into several of the so called "Guru" get
rich quick schemes. These people are masters of double talk, they put
it to you in such a way, that regardless the way the stock goes, you
will think they were right and you placed the buy (or sell) wrong.
"If they are so good, why do they need to sell subscriptions." Why
not just put their money in the market and get rich.
Now, the QQQ's: I am not quite sure what you are looking for in
timing the QQQ's. Short term? Long term? Hourly? Day Trading?.
Anyway, the QQQ's are an ideal investment for a beginner, as well as
some of the pros. Many "Daytraders" play it Short and Long.
There must be 100 ways (technical) to time the QQQ or any other
stocks. One of the most popular is "Bollinger Bands", go to "Big
Chart" which is free, select Bollinger Band, for the chart criteria.
If it is close to the upper band, it is overbought. Conversely, if it is
close to the bottom band, it is oversold.
Just as a matter of observation, since it is a derivitive of the
NASDAQ, it generaly follows the trend of the NASDAQ market.
Thru one of my brokers I receive a complementry news letter from one
of the so called "experts" on predicting the market. He has been dead
wrong on two out of his last three predictions - and he wants $89
mo for a subscription - no way!
The US markets are attractive to me, because you have much lower transaction
costs than the UK with the QQQ being particular interesting since the spread
is minimal.
I have a couple of books on Technical Analysis (Trading Systems & Methods,
Encyclopaedia of Trading Strategies, Encyclopaedia of Technical Market
Indicators, etc). The problem I face is which series of indicators is most
appropriate for the QQQ if I intend to trade both short and long over a
short time frame. By short time frame, I would suggest days/weeks but
certainly never day trading.
I have a basic background in mathematics and some knowledge of computer
programming. Unfortunately, there are many hundreds of Technical indicators,
and I can't see the wood from the trees. My initial attempts failed as
anybody can get indicators to give good results using in sample data but
then fail when faced with out of sample data. That I would ideally like is
some hints on which indicators show promise.
which of the two do you prefer, and at which trading frequency?
I understand that stochastic doesn't always work ;-) but since you said
to have experience gathered over the years please tell how you
successfully interpret those stochastic, if you don't mind. Why did you
choose 21,13, and 8? Does that have to do with FIB ratios, or what?