Wednesday, November 17, 2010
Another good trade
Market not right at the present. Daily chart candles suggest move up over for now, 2 days ago big price spike up with close near the low along with lower action yesterday is what had me preserve profits. Percentage wise this is one of my best in months. Click chart for larger image. FYI, these charts are always basic, I follow a few more things like moving averages to decide on trade entry, also some measure of volatility to decide on trade size. I did not follow this strictly on this issue, in fact, when I first decided to enter stock, I proposed a tighter stop for others, and was thinking more like a $21 stop for me, glad it worked.
A few things that I have read about technical analysis and canslim investing suggest that any stock that breaks out of a base and moves 20% in less than three weeks needs to be held for 8 weeks as it might go on to be one of the big market winners. I can look back on my trade history and see plenty of stocks that are higher now than what I paid for them, I will simply just follow this for another favorable controlled risk entry, it has a good story.
Perhaps these short term swing trades should be my specialty? I am doing quite well at them the past few months. I might miss some of the moves at the start and end, but I am banking coin/ringing the register. I want to have the next 3000% stock, but waiting for such a big winner might have me sitting on losses. I need to masticate on my approach to this: go for longer term buy and hold, or stick with short swing moves?
I talked about this stock to two people in my life, not sure how this affected the trade.