Finally- green moves across the board with everything climbing higher- except USO- down slightly. Can Friday give a repeat higher performance? I certainly hope so- Looks green across the waters today as well- and while the markets are skeptical -perhaps- this consolidation range will not push back to the recent lows. I have some freed cash in the IB account-and I am considering adding some positions- and - since today's bullish price action in many stocks leaves another swing low behind- I will consider tightening some stocks - likely just below the recent pullback lows- HEDJ may be a good example of attempted market moves higher, 1st reversal attempts that fail, go lower- and then put in a lower reversal. At some point- and the wider time frame view may be the most valid at this juncture- How much of a pullback can one sit through- particularly if higher attempts fail to gain traction? With recognition that i am at a higher % risk on most trades- I think it's appropriate to reduce some of that Risk- What looks weak? Using the prior HEDJ chart for this example- updated- A 'pullback' from an uptrend often will give a retracement- and -on a faster chart- that 1st attempt to move higher looks bullish- but may be premature- My HEDJ CHART EXAMPLE The 2 hr faster chart illustrates the intraday price action much more clearly than a daily chart view- Recognizing that you don't want to react on any impulse reaction higher- On the initial 1st reaction, followed by a period of several days with price ranging above the swing low- The 2nd reaction was a gap open higher - a bit of a decline- but a higher close- This looked like a resumption of the uptrend was in the works- Price then sold off- dropped back into the horizontal support for 1 day- broke lower, and provided a new lower 1st reversal- That failed to hold- a 2nd - 2nd reversal looked very similar to the initial reversal-but it then went lower the next day- In the past, I would have raised the stop-loss on the close below the ema- and would have stopped out as price opened lower. Using the major lower swing low - I modified and set a stop-loss below that level at $63.00 The May 13 pullback becomes a higher swing low on the fast chart- Today's May 14 move closes higher- but the trade no longer deserves the wider initial stop-loss- at $63.00 I will raise that stop to under the more recent swing low- and raise the stop to $64.00- Why does it no longer "deserve' the wider stop? Because price action is weak on both 2nd reversals- This is a possible sign of lack of value buyers stepping in with any conviction- And- a drop in price below the recent swing low suggests that the trend is more likely lower than higher in the short term- $64.00 becomes a higher level stop-loss than $63.00. The higher stop-loss assumes price will start trending- higher highs- higher lows. Well, at least not violating the recent swing low that was higher- than the 5.6. low- If price goes below this swing low- It would appear to be time to be short.....or to step aside .
XBI is basing sideways in a relatively narrow range- My buy-stop to add to my position is price at $228.25 - $229.00 on a breakout move higher. Stop-loss on this higher move is below this consolidation range- Will use $216.00- below the range- I'm tightening stops on this market up move- cautiously- I don't want to get too close to the actual trade- but I do not want to allow price to break down to a new lower low. Hack I raised the stop from the wide $28 to $29.00 The simple decrease of a $1 lesser loss per 100 shares position changes the % of loss -reducing it 3.5%. tHIS is important that I understand this - as well as those that may read this- I took a wider position Risk this past week- but it feels like it should be showtime on the market's end- so making logical modifications that lessen the Risk make sense to me. All gradually- FXE looks stong- with a stop under 109 makes it a narrow Risk under -3% BRKB- buy it at $146 with a stop at $143.00? That's about as tight a stop as one could look for- possible upside spy- closing at a new high! or recent high- Coming out of a recent sideways range- let's see if it makes a nother new high- FXE pushing higher stop-loss under $109.00 Buy-stop 112.25- limit $112.75
Friday 5.15.15 update Crunch time for me on the day job for the next few weeks- Extended hours - Work Saturday as well- I would like to update some charts as illustrations, but i simply have a lack of time to do everything I would like- The Day job pays the bills and allows me to pursue my trading /investing interests only as a secondary pursuit- Got to keep things in focus- and practical. USO hit my raised stop-loss- executed at $20.14- Price gapped down on the open lower and took out my stop- then rallied and closed higher- but the rally was not considerably higher- Essentially making a double bottom with today's open lows- In terms of the chart- price made a lower high and is now making a recent low- This should be viewed as a possible top / break in momentum. A lower close under $20.00 would suggest that price could drop further. The macro information is based on future Oil pricing- still in flux . FXE my Buy-stop order filled $112.26 and closed 112.51. HEDJ closed weakly- I'm not sure of the relationship between the two positions- Perhaps FXE is more about currency while HEDJ includes some European stock exposure? i hate to display my ignorance and limited understanding of what some of these ETF trades may be based upon. But the charts suggest that the two do not trade hand in hand. XBI failed to move above the present range- but is continuing to hold within a relatively very narrow sideways range- This is a price consolidation on the upmove after it recently put in a lower low-from April- It is important that the recent swing low not be retested- JMHO_ I think we have had some decent moves lower, since the march high, and this recent move higher the past week or so - which started as a gap move higer- needs to push higher- and exceed the recent range high- fill my buy stop- and get on with making some money- Get past that prior 235 swing- and retest the prior high- The Buy-stop order is designed to get filled when price breaks out beyond the recent sideways range. Remaining positions are holding
Understanding that the environment is fluid - it changes- Day by day- Hour by hour- Week by week..... But there is a relationship in the moves that occur on the market's dance floor. http://stockcharts.com/freecharts/sectorsummary.html#&S=P1
5.17.15 Had a new granddaughter born to my youngest daughter yesterday. When you put everything in perspective- What motivates us to spend the time we spend in the pursuits of profits and trading success? Are we seeking a better quality of financial success to improve the lives of those we cherish? Or would our time be spent better- we personally involved with our loved ones and not absorbed with price charts and the goal of some future level of "success"? gained by our trading prowess...... I find that I am not prepared to modify positions for Monday- Go Figure- LIFE HAPPENS- glad to be a participant.
Our time would be spent better- we personally involved with our loved ones and not absorbed with price charts and the goal of some future level of "success." Definitely! Congratulations! Swift
Thank you- for the congratulations! Seeing another newborn (2nd in 2 months) come into the Family causes you to think in wider terms..... I posted that thought as one can spend an inordinate amount of time in this pursuit--I know I have- over the past years - and I allowed it to take up a large amount of my free time-more for the challenge at this point- but I'll take any gains that come out of this - I would expect that for those that make their living by trading- and that's where the bread is buttered.....you gladly expend the amount of time and energy necessary- For myself- it was a choice I made- ........ When i consider What I would like to be doing with my free time- eventually- it would likely not be locked behind a computer screen-most of the day- that's a solitary endeavor- Ahh- but the lure of trading is to be able to make enough money to be free of the day job- or to earn extra monies to be able to afford that Family Disney vacation- or the cruise - or the summer vacation on the beach for the entire family- or to retire more financially secure..... A good starting point is by having a specific goal in mind- and the purpose behind that goal. I think my final thought on this subject would be- While it may be important to have the desire and a focused goal to 'succeed' - at any thing one tries- not just trading; But, If the effort takes away significantly from sharing quality time and moments when they present themselves- The eventual future financial gain one seeks may not be worth the delayed reward of all the things missed along the way for a future goal- It's like making that cross country trip with blinders on- not noticing much along the journey- just wanting to get to see the Golden Gate Bridge- .Once you are there- that's it- The greater satisfaction would be in the stops one made along the way..........Be nice if the rest of the family was enjoying the trip as well......... Just a commentary on a momentary self-check. Back to trading:
5.18.15 Markets making new highs! Slight upmoves- but higher none-the-less! We'll take it because we need it. It's about time! Mostly green in the account with FXE being in the red and underwater- stop-loss is $109.00 -under 2 prior price pullback swings- on the 2 hr chart. I feel good that the market made this bit of upside move- because it affirms that holding with the wider stop-loss - at least at this point in 2015- kept me in the trades- but at what % Risk did I make that choice? I was likely 2x wider than I normally would be- Was that worth the Risk? The trades withstood the market uncertainity - market moves higher- this will allow me to ratchet up the stops a bit higher- Ideally get everything moved up this week to break even or higher- The IB account is still down about -3.5%- I'm holding 7 trades in IB and 3 in Scottrade (It's a long story-funding separate Roth's in different accounts over the years to test different approaches) LLSP, XLF,PJP; I was out of free cash and went into the Scottrade account- I mention this because I intended to post a screenshot of the IB account and LLSP, XLF will not be in that account- "Diversification" can also be called "dilution" - because every position will not be moving the same- and will not provide an equal return- or demand the same RISK. I have accumulated a fairly large position in PJP- with total share count at 60 shares - Nice to see it moving into the green.....I am also overweight in HACK- a very narrow tech segment that deals with Cyber security. As with my added Buy of XBI mentioned further- I modified an order in IB and overlooked the auto-fill feature- I did not intend to buy 100 shares of HACK- and just moved the stop up to $29.50 greatly reducing the Risk from the $29.00 stop I had. OK, $50.00 may not seem like a lot- but it adds up. Add insult to injury in making ordering mistakes: I wanted to add to XBI (smaller cap biotech) so last week i had placed a buy-stop to purchase an additional 5 shares at a buy-stop higher- and set a wider stop-loss- I then realized that it was confusing to own 5 shares and to add to buy 5 additional shares- so I modified the Buy-stop order and increased it to 6 shares to buy- Price dropped lower, I allowed the buy-stop order to remain active- In the process of modifying the order to 6 shares- the auto-fill sell order changed my initial sell & autofilled a $1 stop-loss -well above my desired stop-loss- and i totally overlooked that change- Thus, I received an e-mail that my buy-stop had filled this am and 45 minutes later received an e-mail that my stop had executed. A careless oversight- I intend to increase the XBI position- particularly since my entry cost is $223.00 on the initial position- and $220.00 remains a valid stop-loss now- I will be increasing my stop and reducing my Risk- Since i had set that order last week, and it had been pending for several days- I could have reviewed it , caught the mistaken auto-fill, and made the correction. Yes, i could offer excuses- but a daily review of pending orders is not asking too much. I was feeling that sector rotation was leaving Pharma & Biotech on the sidelines- but I want to believe that these sectors have sustainability- as long as the market holds up. As for my present positions- PJP, xbi,HACK, tan, DXJ,XLF, llsp are all above my entry- I will be considering raising stops to try to ensure a break-even or higher stop-out this week- I certainly hope and trust that this market finds the rationale to go higher- HEDJ and FXE are both down slightly. LLSP is higher- but i have to get out of this leveraged 1.25x SPY that has no volume- and instead go to the SSO for liquidity- and price transparency. Here is a thought - an order mistake - inadvertent sell or Buy- could have a big impact on one's account- Well worth reviewing before the market opens- This is a simple mechanical double check. Is the order what was intended? Evaluating volatility and percent of Risk- As the market enters into periods of consolidation- An appropriate response would be to reduce the RISK- by reducing the position size- Since we do not know where the outcome of the consolidation will turn- we assume a trend continuing- but what if we are wrong?.........After the initial; thrust in our direction- add to the position- A buy-stop-order is an excellent way to ensure that price is headed in the correct direction- It does not guarantee that the direction will hold- Just that it starts out in one's favor...... Active trading is not everyone's desire- Many are inclined to have an investment account- but simply trust that their advisor has their best interests at heart- and will go decades under that assumption- As greater awareness and opportunities come into the market- commission free ETF trading, low cost etf investing, robo investing- These are all benefits available to workers that traditionally do not have much awareness of what they should be having to pay out to have someone take their hard earned dollars and suggest a market ALLOCATION- MODEL - i think the conventional brokerage accounts with the 5.75% commission are dinosaurs. The investing models will change in the future- Robo investing makes sense with automatic diversification and reallocation. Personal hand holding and reassurance is a thing of the past. I was prompted to this line of thinking by a fellow co worker from another company that actually is unaware that he has any options available- and they were being charged through their local banker to manage/guide the account! and pays the higher commision charges on top of those charged on individual accounts. I think we are in a "wake-up" America- time- The Old is out the door- There is no reason to lay back and feel victimized. For those that may be reading this thread- you have an interest in investing/trading- but you likely already have investments through your employer- look it over carefully for fees, expenses and performance. Do not be passive- look at what your net costs and expenses are being charged-Compare it against a passive investment- SPY for example. It's your money! Not theirs- You earned it-You worked for it They simply Use it. Because most investors drink the Kool Aid. They assume they are being led down the correct path by professional advisors. Wake up- Smell the dandelions. Fight for reduced fees- if you do not seek to go elsewhere's- There is a very large outflow from mutual funds active management into passive management- at a much lower cost. Active management brokers- have seen fund outflows- They should be willing to negotiate better terms if your HR person has the balls to tell them you are considering a shift to a Vanguard type of passive investment in ETF's. Stir the pot of discontent- Your fellow employees have nothing to lose by an accurate appraisal of what costs you are presently paying by the professionals for their guidance. A little cross check with Vanguard Funds comparative calculator would prove interesting... I was surprised that the individual I spoke with today had such little knowledge of what was offered within his retirement account. He is totally reliant on a something that was initially set up by his company for allocation . This is an important Step Guys and Gals- that actually hold tradable IRA accounts- Are you paying a commission? What is your allocation and where is it diversified? How does the historical returns compare to the market returns/ What is the expense ratio? 12-b-1 fees? What is the turnover % ? What is the Morningstar evaluation of the funds ? Cinderalla time
In the trading account, I am all long- I did add 6 XBI today. In the retirement account - I am large CASH- money market fund- Doesn't earn anything , but doesn't Risk anything. FXE looks close to the stop-loss -While HEDJ moved up an equal amount higher- I asked EuroD- on his thread to clarify the relationship between the two- I'd hate to think I owned both sides of essentially an inverse correlation!- DXJ moved up nicely, while tech- TAN ,Hack, were both lower- As the market is pushing to new highs- articles such as this make one wonder if the smart money is not exiting and selling in their positions., reducing exposure- " http://www.cnbc.com/id/102690329" Unfortunately, as I am inclined to be bearish -often to my financial detriment- recognizing what my bias is, I held some of these positions with wider stops- and this recent move higher after a period of flat/decline- needs to gain some traction. My position in Energy- OIl- USO stopped out and today as USO broke down lower- A correlated trade to this sector of higher oil prices was the solar sector- TAN- With Oil going lower , Solar has more challenges to be price competitive- and it is also declining. I will raise my TAN stop to $47.35 lock in some gains if the stop is executed there. DUG would be the appropriate inverse oil trade to enter on this breakdown- I have some cash in the IB account that has not cleared - If it does tomorrow, I may take this inverse Etf trade based on USO breaking down from the recent range- It would have to be a longer term position I think- and I would have to expect a pullback higher towards the recent consolidation range. Raising DXJ stop to $58.75 just under today's open- It's a momentum move- and an aggressive stop- trailing just under price. Locks in a small gain if it is hit here- I'm getting defensive- and want to improve my present loss status of -3.5% The "Value Canary" is alive and well- BRKB- closed higher today- That's a positive IMO for where stocks may be heading- XLF position also moved higher, LLSP, and PJP-included. hmmm, UNABLE TO UPLOAD THE CHART OF DUG. Summary of the chart- following a longer decline, saucer rounding bottom, upmove and a breakout higher from an ascending price wedge- Price closed weakly above the recent top of the range- The buy-stop order expects price to move higher- with a $2 stop-loss (-4%%) below the top of the range and under the line of the wedge. I will try to upload the DUG chart separately