The Oxen Group: Trading Results and Strategies

David, of The Oxen Group, has been giving us high-probability trade recommendations that have been a terrific addition to our trading strategies – simple stock selections, great for single day trades. If you haven’t been following, or wish to see David’s updated results, there’s a summary of results table below. As you can see, out of 23 trades, 20 were breakeven (two) or profitable (18), and only three ended in losses.

In our experience of a little over one month, we’ve identified a dynamic factor to keep in mind: market moving news. News that can change the premise of a trade may come out between the time of David’s recommendation and the opening of the equity markets. This has occurred with TYH – the Direxion Daily Technology Bull ETF. A similar situation occurred recently when the trade was an either-or trade, but a specific pre-condition changed.

On the day of the TYH trade, in pre-market comments, Phil suggested passing on the trade due to news that came out prior to the opening. Phil wrote: "Well I’m generally worried and David is bullish so that’s a "no play" to me. Also, note that he took that position around midnight, when the Hang Seng and Nikkei still looked good and oil was pumped up to $73, all that collapsed with the World Bank report. If we do hold our floor, then it can be a fun trade but I sure wouldn’t be jumping right into a 3x bull tech this morning." In this case, TYH drifted down all day – the premise for the trade was over powered by the intervening World Bank report.

We will try to notify readers when we know of events prior to the open that may affect a pending trade idea. However, even if you don’t see anything specific, remember that over-riding and unforeseeable market forces may come into play after David’s analysis.

The second incident was last Thursday. David’s premise didn’t change, but the number he was initially looking at was preempted by other numbers. The jobs report was worse than expected, resulting in the actual trade being ERY (not ERX).

While we work on ways to get information to traders quickly, please be sure to check The Oxen Group’s site for trading updates – bookmark the page.

Table: David’s Trading Results (since we’ve been posting them)

Date	Stock	Entry	Exit	Change
5/29/09	GPS	16.99	17.67	4.0%
5/30/09	TM	80.77	81.72	1.2%
6/2/09	SRS	18.06	18.6	3.0%
6/3/09	DUG	16.68	17.35	4.0%
6/4/09	TLAB – SS	5.95	5.84	2.0%
6/5/09	XOP	35.84	35.85	0.0%
6/8/09	BLK	164.76	168.87	2.5%
6/9/09	USD	20.3	21.12	4.0%
6/10/09	SINA	30.17	31.07	3.0%
6/11/09	SRS	18.39	19.3	5.0%
6/12/09	NSM	13.23	13.56	2.5%
6/15/09	ERY	18.32	19.05	4.0%
6/16/09	SKF	41.21	42.85	4.0%
6/17/09	SRS	20.17	20.97	4.0%
6/18/09	DIG	28.36	29.21	3.0%
6/19/09	RGR	11.88	12,35	4.0%
6/22/09	TYH	86.42	81.85	-5.3%
6/23/09	ADI	23.32	23.34	0.0%
6/24/09	SONC	9.26	9.63	4.0%
6/25/09	FAZ	5.13	4.93	-4.0%
6/26/09	RIMM	69.15	71.22	3.0%
6/29/09	VIA-B	22.8	23.37	2.5%
6/30/09	JTX	6.31	6.15	-2.5%

FAQs

1. Does David use a stop loss?

David previously didn’t use a stop loss and would simply sell at the end of the trading day, whether or not the stock reached his price target. More recently, David has added a stop loss on all trades.

2. How does David decide when to enter the trade?

David watches the tape, in real time. When he sees a pullback, with prices declining, he watches for a sign that the downward momentum is letting up. In David’s words: "The way it works is that I watch technical indicators to look for a pullback and overselling. When a stock had bullish fundamentals and is being oversold, it is a good time to enter. We look for when fast stochastics have hit a bottom and are showing an oversold indicator. For stochastics, we use standard settings, with real time charts."

We hope this review helps you maximize your results trading David’s stock picks. If you have additional questions or ideas, please share those here in comments. Thanks!