Monday, 25 February 2008

Trades 25/Feb/2008

Before looking at some charts and trades, just a few words about today. Sometimes you have days where it seems 'easy' : it is easy to find stocks to trade and they follow your patterns nice and tidily. On other days however, it is a struggle, you get chopped around and nothing seems to go for you. Today was difficult in my view. But if you keep very very disciplined and patient and focused then there are opportunities to make a profit.

YUM (gap up)

After the gap up, we retraced in first two candles before reversing in a bullish manner with a long tailed doji type. The 4th candle is a bullish candle which opened at its low and closed at its high and at the same time broke out of the OR high. This is our trigger candle to go Long.

Entry: 35.80 Stop: 35.47
Fib Ext:36.34
1R=36.13 2R=36.46 3R=36.79

The price didn't follow thru with a convincing break once above the OR. The 8th candle closed below the OR and so I closed my position for a loss.

BCS (gap up)

After the gap up, we retraced in first two candles before reversing in a bullish manner. The 4th and 5th candles both close at their highs and the latter also breaks out of the OR High. This is our trigger candle for going long.

Entry: 39.82 Stop:39.50
Fib Ext: 40.49
1R=40.14 2R=40.46 3R=40.78

Then over the course of the next 2 hours we go sideways just above the OR high. It was during this time that the market was coming down after a strongish open. Patience and keeping your stops is the key to this trade. See how the candles 17 thru 19 fall below the OR. But the important point is that they all close above it. If there was a red candle which closed below the OR high then we are entitled to close our position. We are then rewarded later with an evening rally. Closed at eod at the Fib Ext for a nice gain.

AUO (gap up)

After the gap up and an initial weak candle we resume out uptrend over the next two candles. The 3rd candle is green and closes above the OR and at its high. This is our trigger for going Long.

Entry: 18.94 Stop: 18.69
Fib Ext: 19.24
1R=19.19 2R=19.44 3R=19.69

The stock can't maintain its break however over the next few candles. The 6th candle closes red and below the OR high forcing us to exit our position for a loss.

ERTS (gap down)

Gap down at start then did nothing by just going sideways over the next 6/7 candles. Candles 9 and 10 cross the OR. Then the 11th candle is a gravestone doji type with wick bouncing off EMA above. It is also a NR3 bar. This is our trigger to go short.

Entry: 47.34 Stop: 47.65
Fib Ext: 46.62
1R=47.03 2R=46.72 3R=46.41

We had a bounce back up after entry and the 14th candle was worrying, but it never closed back into the OR. Then the price started to fall and we closed 1/2 our position at the Fib Ext. Closed the rest after the bullish bar 20 which closed above the EMA.

1 comment:

bl said...

Nice analysis. Knowing that erts was entertaining a bid for ttwo I would have considered shorting it 2/5" as no one wants like the word debt at the moment.