Tuesday, May 02, 2006

Yay for happy mornings!

Day 20 - Tuesday
Total Account Value: $5193
Available Equity: $2660
Positions Opened: 7
Positions Closed: 4

Mornings have become a time of fear and dread for me. If you've been reading the blog, you'd know opening gaps are my arch nemesis of trading! This morning the tables were turned. I was greeted with an opening balance $150 greater than when I left yesterday. My long on the oil price made some nice predictable gains and I closed out (temporarily) about US$200 ahead. Commodities are risky for me because I can't monitor them overnight, but hey at least they can't gap!

The All Ordinaries fell considerably then rose again throughout the morning but somehow all this volatility didn't impact me negatively. At one point I had added roughly $500 for the day. This was due largely to the performance of Zinifex (ZFX) which arose from the resources correction with plenty of spark. I have been very wary about gapping of resources stocks like BHP, OXR, WPL, ZFX, RIO, JBM etc. Therefore I will set a stop losses fairly loose and hence take on a small position size. The initial ZFX position was a measily $3500 (on margin that is). I pyrammided after seeing that its strength would continue - by days end I was quite pleased. It showed the I can maintain strict money management practices and still profit.

But that's where my pleasure ended! The tide turned just after lunch as my losing positions grew worse and my winning positions stagnated. Woodside Petroleum (the second of my medium term CFD trades along with BHP ) did little after starting well, ARQ began to slide heavily and PMN could fall no more after tantalising me with temporary profit. Just glancing at the price action on the Promina chart since the 13th of May would fill anyone with frustration. The number of false breakouts and craziness on there makes me wonder why I don't relegate it to the "get stuffed" basket. Santos is another that was (and still is) behaving like this - I haven't traded it since April 6th.

I had long positions in Downer EDI (DOW) and Brambles (BIL) but it seemed they were shackled down. The charts told me to buy, the market depth screen told me to buy. But in the end I sold out with paperthin losses as the overall downward force of the market took charge.

Still positive signs for tomorrow though. Zinifex is shining, Woodside and BHP will only continue to recover and modestly sized positions were opened in Macquarie Airports (after seemingly completing a downslide) and Oxiana (finally I get a chance to see where one of the ASX200 most exciting prospects will take me).


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3:24 am  

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