Type 2 Express LCS
Before perusing Type 2 Express LCS, it should be
remembered that this LCS is as effective in profit yield
as the positive and powerful direction of AI software.
The role of the AI trading software is like the satellite
in the sky which directs the drivers on the earth on speed,
path, and traffic situation. Just imagine driving on paper maps.
The execution of LCS is when the trading is in 'Day Trading' mode.
The amount of LCS which AI computes and displays for
the trade, let us name it as loss tolerance, keeps changing
as the stock price changes.
In addition, the loss tolerance is usually big, because
its purpose is to allow reasonable degree of price reversal
for covering price change, so that AI suggested price
direction can begin to take effect. In addition,
it allows the trader to have the time to enter manually
the LCS amount right after entering the trade
of 'buy' or 'short'. This is one way of LCS use
It is Type 1 LCS use.
This method has one distinct advantage of having
few LCS fires on price reversal. The disadvantage is,
when LCS fires, the loss amount is usually big,
its process is slow when the trading system is very fast.
Because the trader usually take the input to LCS from AI
calculation and enter it manually.
Express LCS is another way of LCS use.
The famous trading software, "thinkorswim"
of Schwab is quite suitable for express LCS.
What is it and what is the benefit?
It depends on the use of so-called
"Acive Trader ladder screen with trading template"
And the software of 'thinkorswim'
allows the LCS to follow the trading order at the same
time of order placing to the stock exchange,
without manual intervention, when the order is placed,
using both screens below and the template section at left top.
Stock symbol TSLA
Date & Time: 12/22/2023 7:43PM(EST)
1 minute per candle. Extended market
Active Trader's screen
Section of interest is at right top -shaded in black.
within black shaded are:
1st heading at far left:-Qty (show buttons with quantity).
2nd heading at far left -Template:(1$ stop) and auto send with a check off box.
Right below the 2nd line - heading(Ena.. | Qty Link | Offset)
(2 lines below) Please look at 2 lines below 'Offset'.
1st line (+.50 Limit). This button of 1st line is always checked off.
2nd line (-1.00 Stop) means:
if TSLA price falls from purchase price by $-1.00
The system will sell 100 share (bought a couple seconds ago) for LCS.
No manual intervention here.
4 Stocks in Active Trader platform & Choice to Trade per AI Direction
This is the CBO Trading Active Trader platform.
When AI messages hint the profitable choice among 4 stocks -TSLA, LRCX, AMD and META,
then, that stock is selected by clicking on the top line where stock symbol is
and the line is highlighted in blue color, and the trader uses 'click on the price
in buy or select column of the selected stock, and executes the trade. Then,
LCS follows and is entered simultaneously. Very fast and reliable.
No manual typing of price, LCS and other trading instructions.
This is different from traders' manually entering LCS
after placing trading orders. In this case, the process
is naturally slow. At the stock market which is
notoriously fast, such manual submission of LCS Is
ineffective and prone to loss.
What benefit has the express LCS?
It is concurrently submitted as the trading orders do.
Fast and protective from any loss coming from lack of
timeliness. It also allows the trader to take
advantage of unexpected big price reversal.
exprssLCS such as .50, 1.20 and 2.40, helps the trader to
stock price encoraches LCS by -/+ .35, cancel the existing trade.
This permits water testing of AI direction without any loss.
Such trading strategy generates big opportunity of mega profit.
Example is:
Send $0.50 together with the trading order.
Say, order is shorting stock A $110.00. Then,
its companion LCS is $0.50.
expressLCS ranges from .50 to 2.40. the calculation
of the amount of expressLCS depends on the stock price,
the strength of chart signals and the trader's decision.
The stage of intial stock price move to a direction (as hinted
by AI software) will be 'testing water' kind very small volume
of shares with reasonably large expresLCS such as .50,
1.20, or 2.40 in case of high price stock such as TSLA
$457.51 (10022025 10:01 NYT zone).
This express LCS can repeat to be used
until the AI suggested direction begins to be
effective. Say, AI price direction is 'price fall'
and the trader takes this information as 'shorting'.
One(1) express LCS fire or more, but deliciously
profitable results even though it is used many times,
as long as AI price change direction comes true.
Sample Trade
The trade consists of two parts:1 - Exploratory trades;
2 - profit search trades.
Exploratory trade:
Please remember the trade is following AI software direction.
The direction now is the stock price is going to fall.
So, the trade activity be 'short'.
Lets say the stock price is $100.00 and LCS .50.
The goal of this trade to find out if the stock price fall now,
but the big buyers may buy a big volume, raising the stock
price until they exhaust their fund.
The question is how much price they will raise?
Shorting the stock by 1 share with .50 LCS.
The stock unit price be 100.50 = $100.50,
Please remember that stock price enters first and in less than
a second, the LCS is entered to the stock exchange
via stock broker.
Say, the price passed 3 times the LCS limits.
price LCS unit cost share Cost Cumulative
100 0.5 100.5
1
100.5 100.5
100.5 0.5 101.0
1 101.0 201.5
100.65 0.5 101.15 1 101.15 302.65
The cumulative exploratory cost is now $302.65
As described before, the trader can use 'cancel'
when the first LCS fire near firing. That is, the stock price
rose to 100.35(LCS = 100.50 to fire). Instead of allowing .50
LCS to be fired, cancel the order' and nothing is lost.
This process can repeat three times until AI direction
has been issued.
Using 'cancel' to avoid LCS fires, it is another profitable
trading strategy.
Back to the prior exploratory trade.
Now the chart signals indicate that AI direction will start to
take effect. And the AI direction seems trust worthy.
The current stock price is $100.80.
Please review trade carefully. It has been upgraded to
profitable trade like:
LCS $1.5 and unit stock price becomes $102.3; shares
to buy 1,000; and the total purchase cost is $102,300.
The trade detected the chart signal to exit now.
So, the trader has covered the short like:
The short cover price is $98. At that price, 1,000
shares unloaded, resulting at $98,500 cash take.
Summing the trade result, final shorting total was
$102,300. The cash recovery with short covering was
$98,500 and this gross margin is $3,800.
In a detail calculation, a small amount of profit
from the expletory trade was made and be added to the final
trade profit.
Cost Short Cover = profit
100.50 98 2.50
101.00 98 3.00
101.15 98 3.15
total 8.65
The trade net profit becomes $3,800 + 8.65 = 3808.65 And
this is only from one trade. How great feeling the investor
will have!
Thanks for your reading technical jargon.
