The XJO (Aussie 200) has broken through the trading range I mentioned last week and finished the week at 4640. With the international markets finishing higher as well, it looks more and more likely that we are in for a nice rally towards Christmas. Having said this one of things I have learned reading “Trading in the Zone” by Mark Douglas, is that everything is possible in the markets. It all comes down to probabilities and at the moment the probability of a rally is higher than the chances of another steep drop.
Our portfolio profit for the open positions rose from 3.08% to 4.87% with only 6 positions in the red. Other than that there was no movement in the portfolio as we have reached our maximum of 20 open positions. Technically there is one new buy for the week. I have CPA (Commonwealth PPTY Office FD) fulfilling the rules according to the HSC. However I consider the stock to be in a sideways movement and therefore having limited profit potential. Read more…
Categories: Portfolio, Trading Lessons, Trading Updates Tags: awc, ben, bld, boq, bxb, gff, lei, llc, map, SUN, tol, wor
I had a couple of people contact me via email asking why I sold NWS (News Corporation Ltd) and I thought I will quickly post some charts to illustrate this. The first chart is a weekly bar chart and shows the history of NWS as far as the portfolio is concerned.
You can see the initial buy was the 27th of April 2009. This is where we had two closes above the downtrend band and all the other buying rules (according to the HSC) were met as well. We held the stock until 7th of December with two closes below the uptrend giving us the sell sign. At the same time we had a nice flag pattern forming, and we bought back into the stock just a week later.
And finally another two closes below the new accelerated uptrend and we sold it on the 17th May 2010. This may not be clear when looking at the chart, but the outside bar on the 7th of May, made the red bar before a valid trough for the trend band. I have included the gann swing chart as well, which clearly shows the trough. Read more…
A couple of weeks ago I started to have some problems with my desktop that I am using for my trading activities. I just finished setting up all charts and environments that I need for intraday trading, when suddenly the computer wouldn’t boot up anymore. Ok I thought and rebooted the machine several times again, until finally my Windows installation came back up again. Great I thought all is good again, when the dreaded blue screen of death appeared.
Luckily for me I have another laptop, where I was already in the process of installing all the necessary trading software I need. And for some unknown reason the desktop decided to be good again after a few reboots. The desktop then continued to crash and then work again after several restarts. Having an unstable system I decided to call the Extended Warranty Provider (the system was purchased with 2 years extended warranty from one of the major electronics retailers in Australia). Up until then all my prior warranty issues with computers were for Dell computers and I was used to have 24 hours on-site service.
Not this time, the call got logged with the Call-Centre advising me they will assign the job to a suitable repairer within 2-3 working days. I didn’t hear anything back after 2 days and thought I give them another call. After my reminder they finally assigned the job and let me know the repairer will get in touch with me regarding the job. Pro-active me, I rung the repairer and the receptionist told me to be patient they will send out a letter advising me of pick up options for the computer. Through a bit of googling I found out that other people usually waited between 1 and 2 months to get their computer fixed with this repairer. This was something I couldn’t afford and I would imagine no one that trades for a living can afford.
Read more…
One of the greatest challenges for traders is to keep detached from their trades. Just recently I got caught out again and I wrote about it briefly in the Portfolio Update 26. I got attached to Paladin Energy (PDN). I initially bought PDN years ago when it was still around the 1.20 dollar mark, way before it rose up to 10.00 in 2007. This was in the days where I didn’t know much about the share market and Paladin was one of the few stocks where I actually made some good money (at least on paper).
As your average bloke that buys shares here and there, I obviously held on to it even when it came down from its highs and went down back below 4.00. Firstly I wasn’t too interested in the share market (back then) and didn’t check the market on a regular basis. Second I thought, well the stock rose sharply in the years before, I can’t see a reason why it won’t reverse again and shoot past 10.00 dollars. I still saw it as a winning stock then. I bought it for 1.20 and quadrupled the initial investment. Interesting the way the mind works, I didn’t see that I actually lost more than 50% on it in less than a year.
I finally sold it when I did the Home Study Course and realized I didn’t know how much further it would fall. I always saw them as a great buy and I still see them as having a lot of potential. Unfortunately the chart is saying otherwise. Read more…
When I did my charts on the weekend I saw another perfect example for a breakout of an flag pattern. I have been watching CSL for a while now and was amazed how it really narrowed in towards the tip of the flag. This made me wonder when the breakout will occur and in which direction it will go.
Looking at today’s further rise the stock has risen by more than 10% since last Monday. From an HSC point of view you would only use a flag pattern as a re-entry in the market if you had previously sold the stock.
For anyone trading on a shorter timeframe, this could be a nice entry to hold the stock for a couple of days or weeks. Two more examples of flag entries can be found at one of my previous posts. NWS (News Corporation Inc) rose for three more weeks after breaking through, and gave up the gains in the following 4 weeks before rising again.
Read more…
Yesterday I promised another post on CSR. A mentioned CSR is currently fulfilling all the buy rules (according to the Home Study Course) and I will add it to the blog portfolio. For anyone considering to buy the stock there are a couple of other pointers, that might influence the price, to consider.
First CSR received an offer from Shanghai based Bright Food Group for $ 1.5 billion to buy their local sugar and renewable energy assets. This caused the share price to jump up by more than 8% during the week. Since then it has retraced quite a bit. From a technical point of few there are a number of reasons for this: Read more…
