This video by Clay from claytrader.com provides a straightforward day trading strategy. Clay uses a simple yet powerful method to find stocks to trade, focusing on the S&P 500 ETF (Spy) as a baseline. He suggests that traders should look for stocks that are either above or below this baseline to determine whether they are strong or weak compared to the overall market.
He explains that if a stock is above the Spy, it is relatively strong and could be a good candidate for a long position. Conversely, if a stock is below the Spy, it is relatively weak and could be a good candidate for a short position. He emphasizes that this is not a guaranteed strategy, but it can help traders make more informed decisions by providing a context for their trades.
Clay uses his desktop as an example, demonstrating how to identify stocks that are above or below the Spy on a given day. He uses a platform called Lightspeed, which provides a list of "risers and fallers" - stocks that are experiencing significant price movement. He highlights the importance of the percentage column, which shows the change in price for each stock compared to the Spy.
He walks through several examples of how to use this strategy, including stocks like Beyond, Netflix, Boeing, and Microsoft. He explains why some stocks might be more attractive for shorting (selling) or going long (buying) based on their performance relative to the Spy.
In conclusion, Clay's strategy involves identifying stocks that are above or below the Spy and using this information to inform your trading decisions. He emphasizes that this is not a guaranteed strategy, but it can help traders make more informed decisions and potentially increase their chances of success.
1. Clay Trader, from claytrader.com, demonstrates a straightforward day trading strategy.
2. The strategy involves identifying stocks based on their performance relative to the overall market, as measured by the S&P 500 (the "Spy").
3. Stocks that are performing better than the Spy are considered relatively strong, while those performing worse are considered relatively weak.
4. The strategy suggests going long (buying) when a stock is relatively strong and short (selling) when a stock is relatively weak.
5. The example given includes stocks like Beyond, Netflix, mRNA, Boeing, Apple, and CVX.
6. However, the video emphasizes that this strategy should not be applied blindly. Additional factors should be considered in a comprehensive trading plan.
7. The video ends with Clay suggesting that the viewer should be interested in potentially shorting Boeing, CVX, and going long on Beyond, Netflix, and mRNA.
8. The video also warns against going long on a stock like Microsoft just because it's performing better than the Spy, as it's still relatively in line with the market.
9. The video concludes with a reminder that this strategy should form part of a comprehensive trading plan, and not be the sole basis for trading decisions.