Thursday, April 20, 2006

On the ropes

Day 13 - Thursday
Total Account Value: $4808
Available Equity: $2582
Positions Opened: 6
Positions Closed: 4

I'm starting to feel a little queasy whenever 10am rolls around. Opening action continues to devastate me as unpredictable gaps seem to be showing up on every chart. This morning it hit me like a ton of bricks. In my greatest trading tragedy so far, Coca Cola Amatil (CCL) gapped up higher than last Thursday's opening price despite it seeming that its downtrend would continue. Wednesday exhibited signs of profit taking, as the priced gapped lower and rose a small amount on high volume, unable to break the previous day's low. I went short thinking the trend would resume but was wrong. It was much too foolish a move for my risk profile and I paid a high price. I'm a Pepsi man anyway...

But it wasn't just CCL that made me sad. Despite a brief sunny interlude around lunchtime when my balance traced the positive path of the All Ordinaries it was all bad news. WOW burst through my stop loss and taught me why you shouldn't ignore "dark cloud cover" (red candlestick that opens higher and overshadows a black candlestick). It's so much easier to think positively before the falls have happened. Trading is funny in that way - when you look at the chart a few days later it all looks a bit too simple.

PMN was looking a little shaky so I cut my losses, leaving just SUN teetering on the brink of its stop loss. My balance was terrible now at around $4700. The were only two options remaining - give up or carefully rebuild. Since I'm crazy, I chose the latter and bought stock after stock as the signals appeared.

I started off quite well. Healthscope (HSP) had been doing absolutely nothing for the last month and very little since January when it shedded 29% in two days. Reminds me that I'm not the stupidest trader out there. The sellers had to be selling to someone on those days and I'm willing to bet not all of them were shorting profit takers. I read an analyst report on it from a popular newspaper this morning saying the price was not matching the performance of the company. It gapped open slightly this morning following a modest gain on Wednesday so I went long and held on as it jumped 3.5%.

Very wary of gappy openings in the Australian market, I wanted to even up my portfolio with both long and short trades. AXA showed a MACD-price divergence so I shorted once it fell below the close of its decently sized red previous day. Coates Hire (COA) and Excel Coal (EXC) were behaving similarly, with the latter meeting resistance with seemingly strong seller support. Now 5 stocks in the bag. Unfortunately it turned full circle and temporarily broke resistance before the day was done.

On the other side of the coin, John Fairfax Holdings (FXJ) and Centennial Coal (CEY) appeared to have bottomed out. Both looking especially strong with an engulfing and "three stars in the south" (triple weakening bottom) candlestick patterns respectively, confirmed with volume signals. So although my balance was down, I feel I have set myself up for a comeback. If this doesn't work, what will?

Also, I checked out guaranteed stop loss orders. The offering of my CFD provider is quite pathetic. The price is different depending on the price of the stock, which makes little sense. Placing one on a $5 (or less) stock will cost me $2. This price goes up in $5 intervals. Too bad if I want a stop loss for Macqaurie Bank (currently trading at $69). Also the guaranteed stop loss must be placed at least 5% from the current price. Ridiculous! A 5% loss is huge! Especially with an account value as low as mine.

But wait there's more! You must call the trading desk to set one, and who can really be bothered doing that? With the extent they promoted guaranteed stop losses as part of the package it really is a big sham.


Anonymous trading software said...

Great blog.


A Stock Trader
trading software

5:55 pm  
Blogger kuku fashion australia said...

WOW.. Sweet Fashion! Fantastic topics. Liked it., Thanks for the nice Blog. This is really Fantastic. Enjoy online fashion shopping with us! We are- Kuku fashion Australia, with Kuku, Kuku dress, Kuku dresses, Kuku fashion, Mad Love stockist, Mad Love fashion, Toi et Moi online, Toi et Moi jacket, Toi et Moi online. Thanks for staying with us.

9:55 pm  
Blogger Knowledge Plus Australia said...

Thanks for the Great Post. Knowledge Plus is a Registered Training Organisation. training provider australia, certificate iv in business australia, diploma qualifications australia, elearning australia diploma qualifications australia, training provider australia, elearning australia, management qualifications australia, diploma qualifications australia, certificate iv in business australia and many more Training and Supports.

3:15 am  
Blogger karmaloop code said...

russian gift
nesting doll
russian dolls
russian hat

8:48 am  
Blogger mou liton said...

We are the contractor since 1980 for alternations, renovations and extensions. On our website you find more information and you can request a quotation. aannemer, aannemersbedrijf, bouwbedrijf, verbouwen, renovatie, kosten uitbouw,kosten verbouwing
Thank for the Post.

4:16 am  
Anonymous green products said...

Thanks for the Great Post. We want a Green earth for LIVE, why we need- green home, green products, green product, buy green, eco friendly products, environmental products, eco green products, environmentally friendly products. Thank you for staying with us.

11:48 pm  
Blogger oil change va said...

Nice blog. Try to repair engine oil leaks to keep the environment clean. Thanks- oil change and oil change va

11:29 pm  
Blogger stop car engine oil leaks said...

Nice blog. Try to repair car oil leak to keep the environment clean. Thanks- stop car engine oil leaks and oil change va

3:46 am  
Blogger how to remove grease said...

Nice blog. Try to know how to remove grease and how to clean oil spills va to keep the environment clean. Thanks- fix engine oil leaks

9:50 pm  
Blogger joana lui said...

It is great to observe somebody put enough craze towards a matter. I'm thankful that I stumbled upon this process. I am lucky I used the time to read on past the 1st paragraph. You have got a whole lot to say, very much to offer. I really hope guys understand this and look into your page.

safety deposit box
bank safety deposit boxes
mailbox post
residential mailboxes
gold bar for sale

4:00 am  
Blogger best wedding coordinator washington state said...

Excellent & Cool! – I should definitely say I'm impressed with your blog. I had no trouble navigating through all the tabs as well as related info. The site ended up being truly simple to access. Excellent job.. Carry-on. About us..! please visit.
seattle wedding planner
tacoma wedding planner
woodinville wedding planner
tacoma event planner
woodinville event planner
number one wedding planner seattle
tacoma wedding coordinator
tacoma event coordinator
best wedding coordinator washington state
best wedding planner washington state
best wedding planner seattle
best wedding planner tacoma

9:29 pm  
Blogger asif ifteakhar said...

Thank you for the great article I did enjoyed reading it, I will be sure to
bookmark your blog and definitely will come back from again.
I want to encourage that you continue your great job, have a good day

north london business opportunities
london networking groups
london business networking
london business group

3:35 am  

Post a Comment

<< Home