“Never buy a stock because your emotions tell you that you might be missing a chance to make money. This is the wrong reason to buy a stock and is the #1 reason people chase stocks.”
Monday, November 15, 2010
Saturday, November 13, 2010
Blood bath!
The market continued to decline for six consecutive days, losing another 1.63% closing lower at 4076, losing a total of 7.52% within this week. Gainers are mostly third liners while URC, PNB, VLL and BEL are the top losers in yesterday's session.
Technical indicators are now suggesting further decline in the short and medium term, as also suggested by the breaking of 10-20-50 SMAs. However, momentum are slowly building up strength so a rebound would be possible in the short term.
Psychological support at 4000.
Major support at 3896.
AP and AEV continued to simply consolidate, AP closing slightly lower by 1.30% at 30.40 and AEV closing slightly higher by 0.58% at 34.80. Technical indicators for both are still pointing down suggesting further corrective-consolidation in the short term.
React accordingly until proven otherwise.
AP is up by 12.31% within sixteen trading days with doubled up position.
AEV is up by 70 centavos within six trading days. Break-even at 35.07.
Technical indicators are now suggesting further decline in the short and medium term, as also suggested by the breaking of 10-20-50 SMAs. However, momentum are slowly building up strength so a rebound would be possible in the short term.
Psychological support at 4000.
Major support at 3896.
AP and AEV continued to simply consolidate, AP closing slightly lower by 1.30% at 30.40 and AEV closing slightly higher by 0.58% at 34.80. Technical indicators for both are still pointing down suggesting further corrective-consolidation in the short term.
React accordingly until proven otherwise.
AP is up by 12.31% within sixteen trading days with doubled up position.
AEV is up by 70 centavos within six trading days. Break-even at 35.07.
Thursday, November 11, 2010
Still no signs of life
The market continued to decline in today's session, losing another 53.16 points closing lower by 1.27% at 4144.41 with an intraday low of 4090 losing as much as 124 points during the entire session as selling was present across the board and most issues found relatively no support for the mean time.
The immediate support at 4150 was broken down today. If the index continues to break, next support is at the psych 4000 level and major support at 3896.
MACD reading is showing strong downward momentum suggesting further decline in the short term as also being confirmed by continued falling rate of change.
The market is now resting slightly above its 50SMA.
Top gainers for today with relative volume are AP +6.02%, AGI +1.85%, and ACR +1.44%. Top losers with relative volume are MER -7.91%, MPI -5.24%, URC -4.55%,
SM -4.52%, PNB -4.33%, FLI -3.68%, and JFC -3.32%.
Net foreign selling today amounted to P384344606.75.
AP continued to advance today with exceptional volume despite getting sold down during the intraday to a low of 29.25 before recovering at the closing at 30.80 gaining 6.02%. Technical indicators are still showing positive readings.
AEV simply continued to consolidate today, closing slightly higher at 34.60 gaining 1.02%. There is a divergence in its momentum and rate of change suggesting further consolidation in the short term.
Every stock that I put on my watch list this week showed relative weakness and unstable footing.
AP is up by 13.78% within fifteen trading days with doubled up position.
AEV is up by 45 centavos within five trading days. Break-even at 35.07.
The immediate support at 4150 was broken down today. If the index continues to break, next support is at the psych 4000 level and major support at 3896.
MACD reading is showing strong downward momentum suggesting further decline in the short term as also being confirmed by continued falling rate of change.
The market is now resting slightly above its 50SMA.
Top gainers for today with relative volume are AP +6.02%, AGI +1.85%, and ACR +1.44%. Top losers with relative volume are MER -7.91%, MPI -5.24%, URC -4.55%,
SM -4.52%, PNB -4.33%, FLI -3.68%, and JFC -3.32%.
Net foreign selling today amounted to P384344606.75.
AP continued to advance today with exceptional volume despite getting sold down during the intraday to a low of 29.25 before recovering at the closing at 30.80 gaining 6.02%. Technical indicators are still showing positive readings.
AEV simply continued to consolidate today, closing slightly higher at 34.60 gaining 1.02%. There is a divergence in its momentum and rate of change suggesting further consolidation in the short term.
Every stock that I put on my watch list this week showed relative weakness and unstable footing.
continuation of price decline and/or consolidation suggests that one should avoid the stock for the mean time and/or until it shows a clear cut signal/confirmation.
AP is up by 13.78% within fifteen trading days with doubled up position.
AEV is up by 45 centavos within five trading days. Break-even at 35.07.
Wednesday, November 10, 2010
50 Trading Codes and Guidelines
1.Plan your trades. Trade your plan.
2. Keep records of your trading results.
3. Keep a positive attitude, no matter how much you lose.
4. Don’t take the market home.
5. Continually set higher trading goals.
6. Successful traders buy into bad news and sell into good news.
7. Successful traders are not afraid to buy high and sell low.
8. Successful traders have a well-scheduled planned time for studying the markets.
9. Successful traders isolate themselves from the opinions of others.
10. Continually strive for patience, perseverance, determination, and rational action.
11. Limit your losses – use stops!
12. Never cancel a stop loss order after you have placed it!
13. Place the stop at the time you make your trade.
14. Never get into the market because you are anxious because of waiting.
15. Avoid getting in or out of the market too often.
16. Losses make the trader studious – not profits. Take advantage of every loss to improve your knowledge of market action.
17. The most difficult task in speculation is not prediction but self-control. Successful trading is difficult and frustrating. You are the most important element in the equation for success.
18. Always discipline yourself by following a pre-determined set of rules.
19. Remember that a bear market will take back in one month what a bull market has taken three months to build.
20. Don’t ever allow a big winning trade to turn into a loser. Stop yourself out if the market moves against you 20% from your peak profit point.
21. You must have a program, you must know your program, and you must follow your program.
22. Expect and accept losses gracefully. Those who brood over losses always miss the next opportunity, which more than likely will be profitable.
23. Split your profits right down the middle and never risk more than 50% of them again in the market.
24. The key to successful trading is knowing yourself and your stress point.
25. The difference between winners and losers isn’t so much native ability as it is discipline exercised in avoiding mistakes.
26. In trading as in fencing there are the quick and the dead.
27. Speech may be silver but silence is golden. Traders with the golden touch do not talk about their success.
28. Dream big dreams and think tall. Very few people set goals too high. A man becomes what he thinks about all day long.
29. Accept failure as a step towards victory.
30. Have you taken a loss? Forget it quickly. Have you taken a profit? Forget it even quicker! Don’t let ego and greed inhibit clear thinking and hard work.
31. One cannot do anything about yesterday. When one door closes, another door opens. The greater opportunity always lies through the open door.
32. The deepest secret for the trader is to subordinate his will to the will of the market. The market is truth as it reflects all forces that bear upon it. As long as he recognizes this he is safe. When he ignores this, he is lost and doomed.
33. It’s much easier to put on a trade than to take it off.
34. If a market doesn’t do what you think it should do, get out.
35. Beware of large positions that can control your emotions. Don’t be overly aggressive with the market. Treat it gently by allowing your equity to grow steadily rather than in bursts.
36. Never add to a losing position.
37. Beware of trying to pick tops or bottoms.
38. You must believe in yourself and your judgement if you expect to make a living at this game.
39. In a narrow market there is no sense in trying to anticipate what the next big movement is going to be – up or down.
40. A loss never bothers me after I take it. I forget it overnight. But being wrong and not taking the loss – that is what does the damage to the pocket book and to the soul.
41. Never volunteer advice and never brag of your winnings.
42. Of all speculative blunders, there are few greater than selling what shows a profit and keeping what shows a loss.
43. Standing aside is a position.
44. It is better to be more interested in the market’s reaction to new information than in the piece of news itself.
45. If you don’t know who you are, the markets are an expensive place to find out.
46. In the world of money, which is a world shaped by human behavior, nobody has the foggiest notion of what will happen in the future. Mark that word – Nobody! Thus the successful trader does not base moves on what supposedly will happen but reacts instead to what does happen.
47. Except in unusual circumstances, get in the habit of taking your profit too soon. Don’t torment yourself if a trade continues winning without you. Chances are it won’t continue long. If it does, console yourself by thinking of all the times when liquidating early reserved gains that you would have otherwise lost.
48. When the ship starts to sink, don’t pray – jump!
49. Lose your opinion – not your money.
50. Assimilate into your very bones a set of trading rules that works for you.
2. Keep records of your trading results.
3. Keep a positive attitude, no matter how much you lose.
4. Don’t take the market home.
5. Continually set higher trading goals.
6. Successful traders buy into bad news and sell into good news.
7. Successful traders are not afraid to buy high and sell low.
8. Successful traders have a well-scheduled planned time for studying the markets.
9. Successful traders isolate themselves from the opinions of others.
10. Continually strive for patience, perseverance, determination, and rational action.
11. Limit your losses – use stops!
12. Never cancel a stop loss order after you have placed it!
13. Place the stop at the time you make your trade.
14. Never get into the market because you are anxious because of waiting.
15. Avoid getting in or out of the market too often.
16. Losses make the trader studious – not profits. Take advantage of every loss to improve your knowledge of market action.
17. The most difficult task in speculation is not prediction but self-control. Successful trading is difficult and frustrating. You are the most important element in the equation for success.
18. Always discipline yourself by following a pre-determined set of rules.
19. Remember that a bear market will take back in one month what a bull market has taken three months to build.
20. Don’t ever allow a big winning trade to turn into a loser. Stop yourself out if the market moves against you 20% from your peak profit point.
21. You must have a program, you must know your program, and you must follow your program.
22. Expect and accept losses gracefully. Those who brood over losses always miss the next opportunity, which more than likely will be profitable.
23. Split your profits right down the middle and never risk more than 50% of them again in the market.
24. The key to successful trading is knowing yourself and your stress point.
25. The difference between winners and losers isn’t so much native ability as it is discipline exercised in avoiding mistakes.
26. In trading as in fencing there are the quick and the dead.
27. Speech may be silver but silence is golden. Traders with the golden touch do not talk about their success.
28. Dream big dreams and think tall. Very few people set goals too high. A man becomes what he thinks about all day long.
29. Accept failure as a step towards victory.
30. Have you taken a loss? Forget it quickly. Have you taken a profit? Forget it even quicker! Don’t let ego and greed inhibit clear thinking and hard work.
31. One cannot do anything about yesterday. When one door closes, another door opens. The greater opportunity always lies through the open door.
32. The deepest secret for the trader is to subordinate his will to the will of the market. The market is truth as it reflects all forces that bear upon it. As long as he recognizes this he is safe. When he ignores this, he is lost and doomed.
33. It’s much easier to put on a trade than to take it off.
34. If a market doesn’t do what you think it should do, get out.
35. Beware of large positions that can control your emotions. Don’t be overly aggressive with the market. Treat it gently by allowing your equity to grow steadily rather than in bursts.
36. Never add to a losing position.
37. Beware of trying to pick tops or bottoms.
38. You must believe in yourself and your judgement if you expect to make a living at this game.
39. In a narrow market there is no sense in trying to anticipate what the next big movement is going to be – up or down.
40. A loss never bothers me after I take it. I forget it overnight. But being wrong and not taking the loss – that is what does the damage to the pocket book and to the soul.
41. Never volunteer advice and never brag of your winnings.
42. Of all speculative blunders, there are few greater than selling what shows a profit and keeping what shows a loss.
43. Standing aside is a position.
44. It is better to be more interested in the market’s reaction to new information than in the piece of news itself.
45. If you don’t know who you are, the markets are an expensive place to find out.
46. In the world of money, which is a world shaped by human behavior, nobody has the foggiest notion of what will happen in the future. Mark that word – Nobody! Thus the successful trader does not base moves on what supposedly will happen but reacts instead to what does happen.
47. Except in unusual circumstances, get in the habit of taking your profit too soon. Don’t torment yourself if a trade continues winning without you. Chances are it won’t continue long. If it does, console yourself by thinking of all the times when liquidating early reserved gains that you would have otherwise lost.
48. When the ship starts to sink, don’t pray – jump!
49. Lose your opinion – not your money.
50. Assimilate into your very bones a set of trading rules that works for you.
Yikes!
The market continued to slide in today's session, dropping to a low of -92 points before recovering 24 points closing at 4197, significantly lower by 68.88 points from yesterday's closing. Today's decline is accompanied by relatively high volume, decliners outnumbering gainers from 23 to 116, with 36 unchanged.
The huge decline from today came from the sell down in AGI which dropped to a low of 9.80 before recovering up 10.80, recovering half of what it lost during the entire session, closing lower by 5.43%. DMC and MBT are also major contributors in today's decline as they lost 6.53% - closing at 35.05 - and 5.72% - closing at 75 - although on a relatively lower volume. Then most the remaining losers today came from the third liners while majority of the gainers today came from the third liners too, with the exception of JFC gaining 1.61% closing at 94.90.
Profit taking of the foreign brokerage houses is the main culprit in today's landslide, magnified by the lack of support among stocks as seen in their intraday movements.
AP continued to decline today, closing lower by 3.17% at 29.05. There weren't sufficient support seen intraday until closing which has around 2M shares on the bid side. Technical indicators are suggesting rebound in the next two days or so.
Initial target: P35
AEV also continued to decline today, closing slightly lower by 0.44% closing at 34.25. Technicals are still suggesting further decline in the short term. It could also move sideways as there is a clear sideways pattern seen on its chart.
Initial target: P45
AP is up by 7.32% within fourteen trading days with doubled up position.
AEV is up by 15 centavos within four trading days. Break-even at 35.07.
The huge decline from today came from the sell down in AGI which dropped to a low of 9.80 before recovering up 10.80, recovering half of what it lost during the entire session, closing lower by 5.43%. DMC and MBT are also major contributors in today's decline as they lost 6.53% - closing at 35.05 - and 5.72% - closing at 75 - although on a relatively lower volume. Then most the remaining losers today came from the third liners while majority of the gainers today came from the third liners too, with the exception of JFC gaining 1.61% closing at 94.90.
Profit taking of the foreign brokerage houses is the main culprit in today's landslide, magnified by the lack of support among stocks as seen in their intraday movements.
AP continued to decline today, closing lower by 3.17% at 29.05. There weren't sufficient support seen intraday until closing which has around 2M shares on the bid side. Technical indicators are suggesting rebound in the next two days or so.
Initial target: P35
AEV also continued to decline today, closing slightly lower by 0.44% closing at 34.25. Technicals are still suggesting further decline in the short term. It could also move sideways as there is a clear sideways pattern seen on its chart.
Initial target: P45
AP is up by 7.32% within fourteen trading days with doubled up position.
AEV is up by 15 centavos within four trading days. Break-even at 35.07.
Tuesday, November 9, 2010
Color of Money - Finance Manila
Been reading "Trading systems, methods and resources" thread in Finance Manila and found this:
But at the current bull market, it's almost impossible to find someone to compare notes with.
You have to design your strategy, based on your own profile. If you find someone who has the same profile as yours, then you can compare notes, and maybe you can learn from each other.
But at the current bull market, it's almost impossible to find someone to compare notes with.
Personal Disclosure
The market declined further today to 4266.45, closing lower by 29.17 points or 0.68%. Decliners outnumbered gainers, 30 to 81, with 36 unchanged.
Rate of change seems at the bottom already and a bounce is now possible in the short term.
Top gainers with significant volume today are MRC +8.82%, CEB +6.41%, and JFC +2.64% Top losers for today are ALCO -9.72% after gaining 21.35% yesterday, AGI -6.24%, and RFM -4.29%.
AEV finally caved in to further selling pressure, closing lower by 1.71% at 34.40. Declining momentum and rate of change suggests further decline in the short term with possible support at 33.50.
Possibly forming a ranged or an ascending triangle pattern.
Initial target: P45
AP remained strong in the current market condition, closing lower by 0.50% only, closing at 30. However, momentum and rate of change are still both declining suggesting further decline in the short term.
Possible support at 28.65-29.30 (gap) levels.
Initial target: P35
Will write an update on my watch list later.
AP is up by 10.83% within thirteen trading days with doubled up position.
AEV is slightly higher from entry(34.10) within three days. Break-even at 35.07.
Rate of change seems at the bottom already and a bounce is now possible in the short term.
Top gainers with significant volume today are MRC +8.82%, CEB +6.41%, and JFC +2.64% Top losers for today are ALCO -9.72% after gaining 21.35% yesterday, AGI -6.24%, and RFM -4.29%.
AEV finally caved in to further selling pressure, closing lower by 1.71% at 34.40. Declining momentum and rate of change suggests further decline in the short term with possible support at 33.50.
Possibly forming a ranged or an ascending triangle pattern.
Initial target: P45
AP remained strong in the current market condition, closing lower by 0.50% only, closing at 30. However, momentum and rate of change are still both declining suggesting further decline in the short term.
Possible support at 28.65-29.30 (gap) levels.
Initial target: P35
Will write an update on my watch list later.
AP is up by 10.83% within thirteen trading days with doubled up position.
AEV is slightly higher from entry(34.10) within three days. Break-even at 35.07.
Monday, November 8, 2010
Current Watchlist
DMC 6-month Daily chart
Retracement levels:
38.20%: 37.9249
50.00%: 36.9750
61.80%: 36.0251
MBT 6-month Daily chart
Retracement levels:
38.20%: 77.4262
50.00%: 75.5500
61.80%: 73.6738
MPI 6-month Daily chart
Retracement levels:
38.20%: 4.2108
50.00%: 4.1400
61.80%: 4.0692
SCC 6-month Daily chart
Retracement levels:
38.20%: 175.8100
50.00%: 170.5000
61.80%: 165.1900
The red circles suggests possible entry for the said stocks, using MACD and Rate of change as technical indicators to confirm entries.
Retracement levels should not be followed strictly but should only be used as a guide for possible entry. Use technical indicators together with the retracement levels to confirm the entries.
Buy signal maturity ranges from 1 to 6 days max; continuation of price decline and/or consolidation suggests that one should avoid the stock for the mean time and/or until it shows a clear cut signal/confirmation.
Retracement levels:
38.20%: 37.9249
50.00%: 36.9750
61.80%: 36.0251
MBT 6-month Daily chart
Retracement levels:
38.20%: 77.4262
50.00%: 75.5500
61.80%: 73.6738
MPI 6-month Daily chart
Retracement levels:
38.20%: 4.2108
50.00%: 4.1400
61.80%: 4.0692
SCC 6-month Daily chart
Retracement levels:
38.20%: 175.8100
50.00%: 170.5000
61.80%: 165.1900
The red circles suggests possible entry for the said stocks, using MACD and Rate of change as technical indicators to confirm entries.
Retracement levels should not be followed strictly but should only be used as a guide for possible entry. Use technical indicators together with the retracement levels to confirm the entries.
Buy signal maturity ranges from 1 to 6 days max; continuation of price decline and/or consolidation suggests that one should avoid the stock for the mean time and/or until it shows a clear cut signal/confirmation.
Bloody Monday
The market opened up strongly on the opening in today's session before succumbing to profit taking across the board, driving the index lower by 1.23%, closing at 4295. The buy signal on the MACD was confirmed today although it would be wiser to observe the market's movement further before taking up a position as ROC is still pointing to further decline in the short term.
Top gainers for today with relative volume consists of third liners lead by ALCO +21.35%, MUSX 4.05%, and PA +3.51%. DGTL, a second liner, gained 3.12% today closing at 1.65. The majority of the losers came from first and second liners led by RFM 2.10 -4.98%, MBT 78.70 -4.61%, JFC 91 -4.21%, CEB 117 -3.94%, GLO 837 -3.79%, DMC 38.30 3.65%, ICT 43.50 -3.55%, MPI 4.20 -3.23% and AC 398, 3.12%.
That's a lot of significant losers today.
AEV continued to meet strong selling pressure whenever it touches the 36 levels, closing slightly higher by 0.86% at 35.
Rate of change is still pointing up suggesting further upswing in the short term.
Personal Target: P45
AP continued to advance further today in today's session however, it closed significantly lower today as the top buyer from the 28 levels was taking profits from the top of today's price range, inching only by 0.67% closing at 30.15.
Rate of change is relatively toppish in the short term, calling for a correction/consolidation in the short term with a possible support at 28.65-29.30 (gap) levels.
Personal Target: P35
DMC continued to decline significantly today, losing 3.65% closing at 38.30 However, rate of change is relatively at the bottom already, suggesting the resumption of the uptrend in the short term is possible as the MACD is also about to confirm.
Currently at the first line of support. Next possible support at 37.35 if it declines further.
There are a lot of stocks that are providing nice entries this week namely DMC, MBT, MPI, and SCC; all of them are about to give off a buy signal, while RFM has just started to decline.
AP is now up by 11.38% within twelve trading days with doubled up position.
AEV is now up by 2.05% within two trading days, shy by 0.07 cents from break-even point at 35.07.
Top gainers for today with relative volume consists of third liners lead by ALCO +21.35%, MUSX 4.05%, and PA +3.51%. DGTL, a second liner, gained 3.12% today closing at 1.65. The majority of the losers came from first and second liners led by RFM 2.10 -4.98%, MBT 78.70 -4.61%, JFC 91 -4.21%, CEB 117 -3.94%, GLO 837 -3.79%, DMC 38.30 3.65%, ICT 43.50 -3.55%, MPI 4.20 -3.23% and AC 398, 3.12%.
That's a lot of significant losers today.
AEV continued to meet strong selling pressure whenever it touches the 36 levels, closing slightly higher by 0.86% at 35.
Rate of change is still pointing up suggesting further upswing in the short term.
Personal Target: P45
AP continued to advance further today in today's session however, it closed significantly lower today as the top buyer from the 28 levels was taking profits from the top of today's price range, inching only by 0.67% closing at 30.15.
Rate of change is relatively toppish in the short term, calling for a correction/consolidation in the short term with a possible support at 28.65-29.30 (gap) levels.
Personal Target: P35
DMC continued to decline significantly today, losing 3.65% closing at 38.30 However, rate of change is relatively at the bottom already, suggesting the resumption of the uptrend in the short term is possible as the MACD is also about to confirm.
Currently at the first line of support. Next possible support at 37.35 if it declines further.
There are a lot of stocks that are providing nice entries this week namely DMC, MBT, MPI, and SCC; all of them are about to give off a buy signal, while RFM has just started to decline.
AP is now up by 11.38% within twelve trading days with doubled up position.
AEV is now up by 2.05% within two trading days, shy by 0.07 cents from break-even point at 35.07.
Sunday, November 7, 2010
Just an observation
Looks like mining stocks are going to move next week:
PMINI Daily and Weekly Charts:
It has also broke out of its short term downtrend:
AT Daily and Weekly Charts:
LC Daily and Weekly Charts:
LCB Daily and Weekly Charts:
PX Daily and Weekly Charts:
Confirming signals on both daily and weekly charts enough to warrant a buy on mining stocks?
PMINI Daily and Weekly Charts:
It has also broke out of its short term downtrend:
AT Daily and Weekly Charts:
LC Daily and Weekly Charts:
LCB Daily and Weekly Charts:
PX Daily and Weekly Charts:
Confirming signals on both daily and weekly charts enough to warrant a buy on mining stocks?
Friday, November 5, 2010
A trader's job
I was asked by an acquaintance about why I focus to much on losses - which is entirely not true; I focus more on controlling losses rather than the losing itself - the idea which seems to confuse her. So I explained. Well, I tried. I told her that the money you put into the stock market is a losing money, the money you can afford to lose.
Every time you put money into the stock market, you should be expecting it to lose, until proven otherwise by the market. To assume you are right every time you enter a position would only result into expensive loses, as you are going to marry your own opinion. And most of the time, people hate it when their opinion is wrong so they hold on to losing trades instead just to prove they are right. Then the stock starts to recover, they start to feel good because now, they are right. The stock has moved significantly against them though. Or they then realize way later on that they are indeed wrong in their position. Either way, they have already incurred major damage.
Why focus much on losses? What do you think of a trader's job, I asked, answering a question with a question (lol).
I believe that a trader's job is to cut losses. If you let losers hang on, the more damage they do until you finally accept you're wrong. You decide how much you are willing to give the market -stop loss and trailing stop- BEFORE you enter a trade, not when you're in it.
It becomes wrong - looking at the possible loss; fear - alone. We should be looking for the possible upside too so we can compare the potential risk-reward of the trade, then we decide if the trade is worth trading.
Not lecturing or feeling like a guru or something, just picking my brain here. I could be wrong.
So what's a trader's job anyway?
Every time you put money into the stock market, you should be expecting it to lose, until proven otherwise by the market. To assume you are right every time you enter a position would only result into expensive loses, as you are going to marry your own opinion. And most of the time, people hate it when their opinion is wrong so they hold on to losing trades instead just to prove they are right. Then the stock starts to recover, they start to feel good because now, they are right. The stock has moved significantly against them though. Or they then realize way later on that they are indeed wrong in their position. Either way, they have already incurred major damage.
Why focus much on losses? What do you think of a trader's job, I asked, answering a question with a question (lol).
I believe that a trader's job is to cut losses. If you let losers hang on, the more damage they do until you finally accept you're wrong. You decide how much you are willing to give the market -stop loss and trailing stop- BEFORE you enter a trade, not when you're in it.
It becomes wrong - looking at the possible loss; fear - alone. We should be looking for the possible upside too so we can compare the potential risk-reward of the trade, then we decide if the trade is worth trading.
Not lecturing or feeling like a guru or something, just picking my brain here. I could be wrong.
So what's a trader's job anyway?
Quotes!
"Go for a business that any idiot can run - because sooner or later, any idiot probably is going to run it."
- Peter Lynch
"I hate weekends because there is no stock market." - Rene Rivkin
I like the quotes! XD
- Peter Lynch
"I hate weekends because there is no stock market." - Rene Rivkin
I like the quotes! XD
Personal Disclosure
Unbelievable. After global markets gains a hefty 2%(more or less), our market dropped significantly in today's session, dropping by 48.19 points or 1.10% courtesy of the huge sell down of PLDT. Anyway, that was a quick buy signal on appeared on the MACD suggesting buying would be just right on Monday.
Top gainers today with relative volume are BEL +18.65%, SMC +8.37%, AP +5.64%, and RFM +4.74%. Major losers are TEL -8.14% and SMPH -2.35%.
PLDT dropped by 8.14% accompanied by huge volume, which almost completely wiped out its previous gains in the last four weeks. Technically, the drop today is unwarranted. The sell down is unlikely to be a mistake as 7 foreign brokerage houses did the selling namely Macquarie, PEP, UBS, CLSA, JPMorgan, DBP-Daiwa and Deutsche - in that particular order. I highly suspect that are major changes in its fundamentals and/or its earnings report came out as a disappointment.
AEV advanced today by 0.87% after it got sold down when it breached the 36 levels. However, momentum and rate of change are still showing strength pointing to a continuation of advances next week.
No target for AEV as it swings up wildly so I'm simply going to ride it until it shows relative weakness.
AP advanced strongly today, deeming my estimates to be right, gaining 5.64% closing at 29.95. It gaped up today, pointing at 32 as a possible target in the short term IF the gap doesn't get filled. Momentum and rate of change are also both still showing strength suggesting further advances by next week although momentum seems to be at its peak already so there is also a possibility of profit taking early next week.
Personal Target: P35
It would seem that I was right on my decision to sell DMC and buy AEV as DMC continued to slowly decline by 0.50%, closing at 39.75. Meanwhile, AEV continued to advance today, closing slightly higher by 0.87%, closing at 34.70 after it met a strong selling pressure at the 36 levels that pushed the price down at the closing.
Verdict: I am right(sold DMC) and the guy who bought up DMC at 39.95 is wrong, short term speaking.
It seems that I am also right in choosing AEV over AT as AT has only inched up by 0.33% although its rate of change is still pointing up suggesting upward price movement - thus suggesting a bullish divergence. However, there's a bearish divergence reading on the RSI. Having mixed technical readings, I am leaning towards avoiding it as there are more attractive stocks that have confirming signals.
AP is now up by 10.64% within eleven trading days with doubled up position.
AEV is now up by 1.20% within one trading day. Break-even at 35.07.
Top gainers today with relative volume are BEL +18.65%, SMC +8.37%, AP +5.64%, and RFM +4.74%. Major losers are TEL -8.14% and SMPH -2.35%.
PLDT dropped by 8.14% accompanied by huge volume, which almost completely wiped out its previous gains in the last four weeks. Technically, the drop today is unwarranted. The sell down is unlikely to be a mistake as 7 foreign brokerage houses did the selling namely Macquarie, PEP, UBS, CLSA, JPMorgan, DBP-Daiwa and Deutsche - in that particular order. I highly suspect that are major changes in its fundamentals and/or its earnings report came out as a disappointment.
AEV advanced today by 0.87% after it got sold down when it breached the 36 levels. However, momentum and rate of change are still showing strength pointing to a continuation of advances next week.
No target for AEV as it swings up wildly so I'm simply going to ride it until it shows relative weakness.
AP advanced strongly today, deeming my estimates to be right, gaining 5.64% closing at 29.95. It gaped up today, pointing at 32 as a possible target in the short term IF the gap doesn't get filled. Momentum and rate of change are also both still showing strength suggesting further advances by next week although momentum seems to be at its peak already so there is also a possibility of profit taking early next week.
Personal Target: P35
It would seem that I was right on my decision to sell DMC and buy AEV as DMC continued to slowly decline by 0.50%, closing at 39.75. Meanwhile, AEV continued to advance today, closing slightly higher by 0.87%, closing at 34.70 after it met a strong selling pressure at the 36 levels that pushed the price down at the closing.
Verdict: I am right(sold DMC) and the guy who bought up DMC at 39.95 is wrong, short term speaking.
It seems that I am also right in choosing AEV over AT as AT has only inched up by 0.33% although its rate of change is still pointing up suggesting upward price movement - thus suggesting a bullish divergence. However, there's a bearish divergence reading on the RSI. Having mixed technical readings, I am leaning towards avoiding it as there are more attractive stocks that have confirming signals.
AP is now up by 10.64% within eleven trading days with doubled up position.
AEV is now up by 1.20% within one trading day. Break-even at 35.07.
Thursday, November 4, 2010
Up, up and away!
American and european markets are up by more than 1% as of this writing.
Are we gonna get some?
Or are we going to be outside of the kulambo this time?
Are we gonna get some?
Or are we going to be outside of the kulambo this time?
Stock selection
Here are the stocks that I am currently watching:
5-minute chart - six days:
There are four stocks that went up from the starting point namely DMC, AGI, MEG and RFM which stayed neutral for the first few days before catching up with the first three. DMC and MEG just started to move up again in this time frame while AGI started to decline.
The other two stocks went down from the starting point namely AEV and AT while AP still remained flat.
The divergence among the stocks is probably a sign of potential for rotational plays.
The flattening of AP is probably a good sign for positioning.
Let's see how they all go by next week to see if I am correct in my assumptions.
Now, looking at their daily chart - six months:
It seems that RFM outperformed every stock on my list with only DMC catching up with it lately, all thanks to that two weeks or so consolidation.
AP is under-performing amongst the stock selection together with AT. Let's see how they perform this month and see if I am right on betting on AP.
Holding Companies:
Here is a possible rotational play for swing trading as there seems to be a slight divergence with AEV and AGI. Meanwhile, DMC is outperforming both.
Other Sectors:
Here is a possible rotational play for swing trading as there seems to be a slight divergence lately with AT and MEG. Meanwhile, AP is currently underperforming from both stocks although it still trending up but at a relatively slower pacing.
There's nothing to compare with RFM as it outperformed every other stock on the list.
Conclusion:
Swing trading rotation:
AEV-AGI
AT-MEG
Position trading:
AP: moderately conservative, swing-trading would be relatively unproductive as it doesn't seem to decline significantly during corrections. It seems that implementing a buy and hold strategy is best.
DMC: moderately aggressive, swing-trading would be slightly unproductive as cost seems to be only slightly lower from the swings that it produces during its corrections. It seems that implementing a buy and hold strategy is best.
RFM: aggressive and slightly speculative. Swing-trading would be relatively productive as it declines relatively during corrections which is more than enough to cover costs.
*IF AP - the underperforming stock - catches up with RFM and DMC, that would be more than 60% potential upside.
Hope I'm right in this.
5-minute chart - six days:
There are four stocks that went up from the starting point namely DMC, AGI, MEG and RFM which stayed neutral for the first few days before catching up with the first three. DMC and MEG just started to move up again in this time frame while AGI started to decline.
The other two stocks went down from the starting point namely AEV and AT while AP still remained flat.
The divergence among the stocks is probably a sign of potential for rotational plays.
The flattening of AP is probably a good sign for positioning.
Let's see how they all go by next week to see if I am correct in my assumptions.
Now, looking at their daily chart - six months:
It seems that RFM outperformed every stock on my list with only DMC catching up with it lately, all thanks to that two weeks or so consolidation.
AP is under-performing amongst the stock selection together with AT. Let's see how they perform this month and see if I am right on betting on AP.
Holding Companies:
Here is a possible rotational play for swing trading as there seems to be a slight divergence with AEV and AGI. Meanwhile, DMC is outperforming both.
Other Sectors:
Here is a possible rotational play for swing trading as there seems to be a slight divergence lately with AT and MEG. Meanwhile, AP is currently underperforming from both stocks although it still trending up but at a relatively slower pacing.
There's nothing to compare with RFM as it outperformed every other stock on the list.
Conclusion:
Swing trading rotation:
AEV-AGI
AT-MEG
Position trading:
AP: moderately conservative, swing-trading would be relatively unproductive as it doesn't seem to decline significantly during corrections. It seems that implementing a buy and hold strategy is best.
DMC: moderately aggressive, swing-trading would be slightly unproductive as cost seems to be only slightly lower from the swings that it produces during its corrections. It seems that implementing a buy and hold strategy is best.
RFM: aggressive and slightly speculative. Swing-trading would be relatively productive as it declines relatively during corrections which is more than enough to cover costs.
*IF AP - the underperforming stock - catches up with RFM and DMC, that would be more than 60% potential upside.
Hope I'm right in this.
Personal Disclosure: Being wrong and right at the same time.
The market inched another 15.44 points today, closing at 4397 - 0.35% higher from yesterday's session. There could be one more possible movement to the upside before profit taking occurs as being suggested by the signal from MACD. Rate of change also seems relatively toppish at the moment.
AP continued its corrective consolidation today, closing at 28.35, 1.43% higher from yesterday's session. Rate of change has finally turned up suggesting the upward bias of the spinning top candle that formed today. Price advancement is very possible by tomorrow or early next week at worst.
Personal target for AP(initial): P35
DMC continued to advance today by 1.52%, closing at 39.95. Looking at the 5-minute chart, it would seem that the best buying window for this is when it is consolidating. Rate of change has already turn up again suggesting price advances in the short term although it already half-way near its previous peak.
The buy signal that I was talking about yesterday was confirmed today as it closed strongly today at 34.40, up by 2.08%. Rate of change has also continued to increase today, confirming strongly the buy signal that it gave yesterday, also suggesting the start of price advances again in the short term.
With that being said about DMC and AEV, I decided to sell DMC at 39.40 during the middle of the trading session and bought AEV at 34.10. The reason why I dropped DMC is that I believe that it is only capable of gaining another 5% or so in the short term in comparison with what's AEV could gain -in my belief- in the said time frame. I was hoping for DMC to move up significantly today so I could sell it just a bit higher but it was simply range trading the entire session within 39.35 to 39.40 range.
After I sold DMC, I bought AEV immediately although the timing is slightly off as I was hoping for a better timing. I was looking at its 5-minute chart hoping to time it correctly but I was feeling uneasy that it might go up suddenly so I posted a buy at 34.20. Luckily, my broker was acting slower today that it fell at 34.10 before my posting was done so I was done at that price. The 5-minute chart was suggesting a drop to 34 and lower is imminent but emotions got a better hold of me so there. That's what happens when emotions get in the way.
Anyway, buying AEV today was deemed correct by the market as it showed profit right after I bought it.
My selling of DMC is probably wrong as it continued to advance further after I sold it. However, the possibility that the buyer, who bought up DMC in the last minutes of trading, is wrong. Verdict by tomorrow.
AT still looks attractive to me but no more available funds. That's just sad.
Could it also be possible that RFM has already formed a short term peak at 2.12? Please make a corrective-consolidation for the mean time so I can buy you.
A new addition in my trading system seems to be working very well as a sell signal. I still haven't back-tested it yet but it is showing progress in the mean time - specially in this slightly trending-sideways-to-up market movement. Didn't use it on DMC though.
Sold DMC at 39.40 with 8.56% net gain on the seventh day of holding it.
Bought AEV at 34.10, closed at 34.40 (+0.0088%).
AP is currently up by 4.73% within ten-trading days. Doubled my previous position.
AP continued its corrective consolidation today, closing at 28.35, 1.43% higher from yesterday's session. Rate of change has finally turned up suggesting the upward bias of the spinning top candle that formed today. Price advancement is very possible by tomorrow or early next week at worst.
Personal target for AP(initial): P35
DMC continued to advance today by 1.52%, closing at 39.95. Looking at the 5-minute chart, it would seem that the best buying window for this is when it is consolidating. Rate of change has already turn up again suggesting price advances in the short term although it already half-way near its previous peak.
The buy signal that I was talking about yesterday was confirmed today as it closed strongly today at 34.40, up by 2.08%. Rate of change has also continued to increase today, confirming strongly the buy signal that it gave yesterday, also suggesting the start of price advances again in the short term.
With that being said about DMC and AEV, I decided to sell DMC at 39.40 during the middle of the trading session and bought AEV at 34.10. The reason why I dropped DMC is that I believe that it is only capable of gaining another 5% or so in the short term in comparison with what's AEV could gain -in my belief- in the said time frame. I was hoping for DMC to move up significantly today so I could sell it just a bit higher but it was simply range trading the entire session within 39.35 to 39.40 range.
After I sold DMC, I bought AEV immediately although the timing is slightly off as I was hoping for a better timing. I was looking at its 5-minute chart hoping to time it correctly but I was feeling uneasy that it might go up suddenly so I posted a buy at 34.20. Luckily, my broker was acting slower today that it fell at 34.10 before my posting was done so I was done at that price. The 5-minute chart was suggesting a drop to 34 and lower is imminent but emotions got a better hold of me so there. That's what happens when emotions get in the way.
Anyway, buying AEV today was deemed correct by the market as it showed profit right after I bought it.
My selling of DMC is probably wrong as it continued to advance further after I sold it. However, the possibility that the buyer, who bought up DMC in the last minutes of trading, is wrong. Verdict by tomorrow.
AT still looks attractive to me but no more available funds. That's just sad.
Could it also be possible that RFM has already formed a short term peak at 2.12? Please make a corrective-consolidation for the mean time so I can buy you.
A new addition in my trading system seems to be working very well as a sell signal. I still haven't back-tested it yet but it is showing progress in the mean time - specially in this slightly trending-sideways-to-up market movement. Didn't use it on DMC though.
Sold DMC at 39.40 with 8.56% net gain on the seventh day of holding it.
Bought AEV at 34.10, closed at 34.40 (+0.0088%).
AP is currently up by 4.73% within ten-trading days. Doubled my previous position.
Wednesday, November 3, 2010
Riding with the Bulls
Charts of companies' stock performance after their presentation with Citiseconline last October 27:
It would seem that AGI was the best performer after their presentation.
However:
A 6-month comparison shows that DMC has been outperforming the other issues, only seconded by AGI while the other two MPI and ICT were severely underperforming.
With that being said, I am more inclined to buy the stronger issue/s which are DMC and AGI.
It would seem that AGI was the best performer after their presentation.
However:
A 6-month comparison shows that DMC has been outperforming the other issues, only seconded by AGI while the other two MPI and ICT were severely underperforming.
With that being said, I am more inclined to buy the stronger issue/s which are DMC and AGI.
RFM CORPORATION (RFM)
10-Year Daily Chart
RFM has finally taken out its major resistance P2 today with exceptional volume after consolidating in more than two weeks, suggesting the resumption of its uptrend in the intermediate term.
The resumption of the uptrend is pointing out at 2.85 as target in intermediate term.
However, current uptrend would seem to be advancing in a slightly lower pacing from its previous advances as pointed out by the fan lines.
6-Month Daily Chart
It has also broke out of its ascending triangle pattern today, pointing out at 2.27 as an immediate target.
There are still no signs of danger appearing on its weekly chart.
I am trying to be careful in trading break outs, specially when it is their first so I would be still on the sidelines here as it deemed to be much safer to wait for a pull back. I also set a rule in my system to sell the first break out and buy the second one so today should have been a sell IF I had a position.
A pull back to P2 should provide a good buying opportunity, or as close as possible. If it would be possible, below P2 should also provide good bargains.
RFM is also highly obedient of its trend/support line.
Short Term Target: 2.27
Intermediate Term Target: 2.85
Immediate Support: 2
RFM has finally taken out its major resistance P2 today with exceptional volume after consolidating in more than two weeks, suggesting the resumption of its uptrend in the intermediate term.
The resumption of the uptrend is pointing out at 2.85 as target in intermediate term.
However, current uptrend would seem to be advancing in a slightly lower pacing from its previous advances as pointed out by the fan lines.
6-Month Daily Chart
It has also broke out of its ascending triangle pattern today, pointing out at 2.27 as an immediate target.
There are still no signs of danger appearing on its weekly chart.
I am trying to be careful in trading break outs, specially when it is their first so I would be still on the sidelines here as it deemed to be much safer to wait for a pull back. I also set a rule in my system to sell the first break out and buy the second one so today should have been a sell IF I had a position.
A pull back to P2 should provide a good buying opportunity, or as close as possible. If it would be possible, below P2 should also provide good bargains.
RFM is also highly obedient of its trend/support line.
Short Term Target: 2.27
Intermediate Term Target: 2.85
Immediate Support: 2
Personal Disclosure
The market continued to advance further in today's session, gaining another 40 points, closing at 4381 today, higher by 0.92% from yesterday's closing. Major index contributors today are SCC up by 6.23%, VLL up by 6.06%, SMC up by 4.88%, and MBT up by 3.94%. Major losers today are FGEN down by 3.43% and CEB down by 3.39%. CEB is now down by 4.16% from its IPO price.
The market is now seem to resume its uptrend after consolidating for four weeks as MACD is now slowly turning up.
Riding with the bulls is now being led by AGI +10.24%, ICT +9.4%, DMC +9.31% and MPI +7.81% after they played catch-up with DMC after their presentation with Citisec.
AP continued its corrective consolidation today closing at 27.95, higher by 0.18% only from yesterday's closing. Rate of change are looking to turn up that might indicate the resumption of uptrend although it could still end up flat on tomorrow's session. Uptrend might resume from late this week to early next week.
DMC continued to advance today despite of its declining rate of change, indicating bearish divergence with the indicator. The latest divergence that I saw within my watch list was from MEG which resulted into sideways movement for about two weeks before it started to head back up. So there are now two things that are needing attention: divergence in price to volume and divergence in price to rate of change.
Or it could simply move in a boxed pattern.
AEV gave off a buy signal today. A strong opening tomorrow should confirm the buy signal although it still has to sustain its strength upon closing.
Amongst the five stock that I put up in my watch list yesterday, Atlas seems to be the most attractive stock to buy as it's the one that have fallen the most in terms of rate of change. Coincidentally, its price today closed at 61.80% fibonacci retracement level.
RFM has finally woken up from its more than two weeks of consolidation, taking out the heavy resistance at 2 today with exceptional volume, reaching a high of 2.12 before closing at 2.06. Target in the current uptrend in the medium term is now at 2.85. I'm trying to be careful now with stocks behaving like this so I'll wait for a correction for the mean time before taking a position here. Expect the previous resistance at 2 to provide support when it pulls back and it should also provide a good buying window. I'll be posting its chart later today.
AP is currently up by 3.26% in nine trading days. Doubled my position in AP.
DMC is currently up by 8.42% in six trading days.
*AT is looking attractive at current conditions so I am thinking of dropping DMC for it. If AT opens strongly tomorrow and sustains it, closing above the 10SMA, I'll buy it and will drop DMC. Much better if DMC surges up by 5%. If it does more than that, I'm just going to hold onto it.
So much for following your plans.
The market is now seem to resume its uptrend after consolidating for four weeks as MACD is now slowly turning up.
Riding with the bulls is now being led by AGI +10.24%, ICT +9.4%, DMC +9.31% and MPI +7.81% after they played catch-up with DMC after their presentation with Citisec.
AP continued its corrective consolidation today closing at 27.95, higher by 0.18% only from yesterday's closing. Rate of change are looking to turn up that might indicate the resumption of uptrend although it could still end up flat on tomorrow's session. Uptrend might resume from late this week to early next week.
DMC continued to advance today despite of its declining rate of change, indicating bearish divergence with the indicator. The latest divergence that I saw within my watch list was from MEG which resulted into sideways movement for about two weeks before it started to head back up. So there are now two things that are needing attention: divergence in price to volume and divergence in price to rate of change.
Or it could simply move in a boxed pattern.
AEV gave off a buy signal today. A strong opening tomorrow should confirm the buy signal although it still has to sustain its strength upon closing.
Amongst the five stock that I put up in my watch list yesterday, Atlas seems to be the most attractive stock to buy as it's the one that have fallen the most in terms of rate of change. Coincidentally, its price today closed at 61.80% fibonacci retracement level.
RFM has finally woken up from its more than two weeks of consolidation, taking out the heavy resistance at 2 today with exceptional volume, reaching a high of 2.12 before closing at 2.06. Target in the current uptrend in the medium term is now at 2.85. I'm trying to be careful now with stocks behaving like this so I'll wait for a correction for the mean time before taking a position here. Expect the previous resistance at 2 to provide support when it pulls back and it should also provide a good buying window. I'll be posting its chart later today.
AP is currently up by 3.26% in nine trading days. Doubled my position in AP.
DMC is currently up by 8.42% in six trading days.
*AT is looking attractive at current conditions so I am thinking of dropping DMC for it. If AT opens strongly tomorrow and sustains it, closing above the 10SMA, I'll buy it and will drop DMC. Much better if DMC surges up by 5%. If it does more than that, I'm just going to hold onto it.
So much for following your plans.
Tuesday, November 2, 2010
Personal Disclosure
The market gained a whopping 73 points today, with major contributors coming from the industrial and holding firms.
Riding with the bulls are now being led by AGI +10.24%, ICT +10.05%, MPI 8.04% after playing catch up with DMC with +8.02%.
AP is poised for further correction in the short term as the rate of change is still declining. Uptrend might resume from late this week to early next week.
DMC is poised for a correction in the short term as suggested by declining rate of change.
Out of the five stocks I put on my watch list, two of them opened strongly, namely AGI and URC as both gave off a buy signal on the weekly charts. Despite of not opening strongly today, the other three - AT, PX, and PNB also gave a buy signal on their weekly charts, suggesting a buy this week. I'm all tied up with AP and DMC already so I'll just be watching all issues to confirm my ideas. One thing I am uncomfortable with is PX candlestick which is seem to be forming a falling method.
AEV also gave a buy signal today on the weekly chart while AP gave a sell signal in the weekly chart. Besides that, there's nothing much to worry about the Aboitiz stocks. AEV has also a inverted hammer candlestick on its chart so it might advance ahead of AP in the short term.
AP is currently up by 3.07% in eight trading days. Doubled my position in AP.
DMC is currently up by 7.04% in five trading days.
AP 70%
DMC 17%
Cash 13%
*Sitting tight for the mean time. I am thinking of holding either of them till December to reduce stress when trading. I would probably use the remaining 13% or less for swing trading just to cure the itch when watching the ticker or for speculative/high risk stock positions. I think I had my fair share of roller coaster ride in the stock market already. Anyway, hopefully by year end, I have doubled my capital so I'll have a better room for elbow next year! Gotta squeeze everything that we can get out of this bull market!!!
Riding with the bulls are now being led by AGI +10.24%, ICT +10.05%, MPI 8.04% after playing catch up with DMC with +8.02%.
AP is poised for further correction in the short term as the rate of change is still declining. Uptrend might resume from late this week to early next week.
DMC is poised for a correction in the short term as suggested by declining rate of change.
Out of the five stocks I put on my watch list, two of them opened strongly, namely AGI and URC as both gave off a buy signal on the weekly charts. Despite of not opening strongly today, the other three - AT, PX, and PNB also gave a buy signal on their weekly charts, suggesting a buy this week. I'm all tied up with AP and DMC already so I'll just be watching all issues to confirm my ideas. One thing I am uncomfortable with is PX candlestick which is seem to be forming a falling method.
AEV also gave a buy signal today on the weekly chart while AP gave a sell signal in the weekly chart. Besides that, there's nothing much to worry about the Aboitiz stocks. AEV has also a inverted hammer candlestick on its chart so it might advance ahead of AP in the short term.
AP is currently up by 3.07% in eight trading days. Doubled my position in AP.
DMC is currently up by 7.04% in five trading days.
AP 70%
DMC 17%
Cash 13%
*Sitting tight for the mean time. I am thinking of holding either of them till December to reduce stress when trading. I would probably use the remaining 13% or less for swing trading just to cure the itch when watching the ticker or for speculative/high risk stock positions. I think I had my fair share of roller coaster ride in the stock market already. Anyway, hopefully by year end, I have doubled my capital so I'll have a better room for elbow next year! Gotta squeeze everything that we can get out of this bull market!!!