Thoughts of a Novice Trader

Moving Out

2011-09-28T17:07:00.001+08:00

I have decided to make a new blog called Return to Sender (http://lejendlady.wordpress.com). Thoughts of a Novice Trader is too restrictive to stock market posts. With the market not as encouraging as it was before, I have found myself seeking other activities that I cannot write about in this blog, simply because they are not market related. Return to Sender will not only cover my thoughts on the market but other aspects of my life as well, including my recent interest in Mountaineering.

Monday Shmonday

2011-09-12T14:43:00.001+08:00

Yiiiikes! The market is definitely not looking too well. Breakdown, anyone? The PHISIX was down 52 points today. Considering the Dow fell by 350 points, I thought we'd do worse. I think down 350 is now the new down 100 points. Remember the times we once felt a -100 was already such a disaster? Volatility in the Dow is definitely increasing. I don't think that's such a good thing. Also, this has got to be the longest basura run. These aren't signs of a healthy market. I've been hearing scary predictions of -20% (at least) for the PHISIX next year. Then a -40% for the Dow next year. What do you think?

Today's highlight was the introduction of Philex Petroleum (PXP). It opened at 3 pesos then spiked to as high as 13, dipped to as low as 7.4, rallied back up to 9 pesos then moved sideways from here until it closed the day at 8.6. WILD! I think the move in PXP lit something in the oil industry or oil related issues. OPM tried to breakout today but still closed within its range. BSC? UNI? SOC? Hmmm...

AR vs. UPM. Haaaay! I got in the slower and much weaker horse.

Buttercup

2011-08-17T19:00:00.000+08:00

"Why do you build me up, buttercup baby,

Just to let me down and mess me around?"

I dedicate this song to the so-called jockey of WPI who built it up then let it down. So, what did he do? I didn't follow WPI intraday but I did hear some stuff about it. So, I'm reviewing the time and sales information to match what little info I have. I think he bought WPI from .65 to .68. I remember being amazed when I found out he was able to "secretly" sell all that he bought at .71 to .73. I said "secretly" because I didn't notice that he sold all already. I think he didn't sell it down. Instead, he just posted his selling and people just bought him up. When it failed to bounce back as expected, he sold down his core shares starting from .66 to .64. In a nutshell, its freakin' amazing how he was able to make a market for WPI for his portfolio size and come out of it alive. A true master at work. Hands down! :))

Today was definitely a basura day. Can you just imagine me skipping happily in a pile of basura, if you wanna take it literally? =)) My favorite today was BKD. I was buying it from 1.21 to 1.32. I was able to escape with some profit as I sold at 1.43 and 1.32. I'm finding it interesting figuring out which basura will fly next. I actually still have a position on EVER. I have my fingers crossed. I bought this just last Friday then bought more yesterday and today. BHI was the one that got away.

Domino Effect

2011-08-15T16:13:00.001+08:00

There wasn't much excitement during the first few minutes of trading. LC lang ata ung kumikinang sa mga mata ko nung una. But the thing is, LC gapped up again today and I was very hesitant to try to squeeze whatever money I could. I tried several times last week. The first time, I escaped with a little profit then the second and last try, with a small loss. Knowing LC has been going up for three days now, no way in hell would I re-enter at current levels. I thought it was gonna be a boring day. There isn't much excitement when Dow is up, don't you think? For someone with barely any position, it's very boring when prices gap up. But today was a little bit more special. Someone turned the light switch on and the PWR came on. ;)

Paris Hilton? Haha! I've been hearing noise about her visit here two Fridays ago. A friend of mine bought PWR last August 5 in anticipation of a surge based on such news. Apparently, he bought too early and just when he thought the news was discounted already and there won't be any play anymore, PWR surges today. Anyway, he was still able to day trade it so, congrats! :))

Play. These days, traders are always on the lookout for what the next play is. The play in PWR woke some idle money up and I noticed they hit ZHI next. ZHI was lazily trading within a narrow range from 1.04 to 1.06 after reaching a high of 1.08 by the open. ZHI hit a 1.09 in this run but fell again by the close. I think we could use some comedy so let me tell you what I did with ZHI today. I bought near the open at 1.06. I was already so itchy to sell it down to 1.05 when I saw that it wasn't the time yet. But I decided to hold onto it first and see how it pans out. When the bids were toughening up and PWR started soaring, I kind of knew ZHI was next. I was right. It went to 1.09 but did I sell? Noooooo. I sold at 1.05. Then bought back again at 1.05. ZHI closed at 1.04. What the hell was I thinking?? Hahaha! I really like the intraday chart. I should have thought this would require a little more time since it definitely has no momentum yet and is still moving sideways. Duh, Christinuuuh! Hahaha! Umm, hanggang 1.04 nalang ako. Promise! :))

Today was like a domino effect. First was PWR, then ZHI, then all of a sudden, basura was flying everywhere! MRC, WPI, WIN, ARA...

The Trade that Saved Me

2011-08-12T12:34:00.004+08:00

Whoo! That was one hell of a week. All my positions were stopped out except for LCB. My portfolio suffered a massive decline as I was heavy in AT,GERI and SECB. :( Moving on..

Thanks to Lolo, I made all those lost profits back. Seeing that LCB was holding strong during the bloodbath, I bought more with conviction. Let's see if this trade continues next week. :)

I was also very thankful to a tweet by DarvasTrader
"But remember that you don't need to sell everything as soon as a Downtrend begins. Stick to your stops. Some leaders WILL hold up. $$"

True!

Roller Coaster Stock of the Day

2011-08-01T21:10:00.001+08:00

And this award goes to....

Boulevard Holdings, Inc.

Just the other day, an office mate of mine asked if I was the one who bought "Boulevard of Dreams". I said, no, baka maging Boulevard of Broken Dreams. Well, I believe the dreams are being fixed now. :P Anyway, the daily chart of BHI looks like a weaker ZHI. BHI was consolidating within a narrow range between .192 and .206. When I saw that it even gapped up today, I decided to buy a little. Experimental shares. I started buying at .202. When somebody followed and even ate up the next fluct, I decided to try again. I bought another batch at .204, .205, .206 then .21! It consolidated around .21 then booooom! .22! Then booooooom! .20. =)) I think this stock is also vying for "Heart Attack Stock" on top of being my Roller Coaster Stock of the Day.

MEG

2011-07-27T14:51:00.004+08:00

MEG freaky inverse head and shoulders. 2.30 working as resistance of 10-month downtrend line.

zooming out.. 2.48-2.50 is working as resistance of a double bottom.

Fly high FLI.

2011-07-23T16:15:00.005+08:00

Properties moving and while browsing charts, spotted this one. Perfect time to break its inverse head and shoulders pattern in the daily chart.

If one is to trade patterns, a sample trading plan is to risk .10 cents. That is already about 3x multiple of its 20 day moving ATR at .03.

Buy: 1.28-1.31
Stop: 1.18
Target: 1.6-1.62

Risk .10-.12 for a potential gain of .30-.32 cents. That's 1:3 risk to reward ratio.

Next resistance is at 1.35. Support is at 1.20.

Zooming out is the weekly chart. It looks like a 4yr cup and handle forming. Long term target could be as high as 2.8. That is still a double bagger at current levels.

:)

Agreed is Greed with an A

2011-07-19T15:58:00.000+08:00

This one's a real monster right here. I've been hearing people compare PWR's outburst to BW. Fantastic, indeed! ...And just when everyone thought it can push higher for another day, its week long monstrosity ends today. You know what today's high of 5.66 is called? Greed. This morning, I already had a sinking suspicion PWR will find a peak today. You know why? I used yet another human indicator. He said it with such certainty, that PWR can push for another day. That was it! I heard and felt the greed. But really, gap up to 5.50?? That's really crazy! I'm sure the shorts had some real fun today. ZHI, VITA and BHI also felt the force of gravity today. I won't paste their respective charts anymore. They all look the same with some very mean looking black candles. :P

To the ceiling stocks and stockholders, I dedicate this song for you:

"Well, it was just a dream,

just a moment ago.

I was up so high,

looking down at the sky.

Don't let me fall.

I was shooting for stars

on a Saturday night.

They say what goes up

must come down,

but don't let me fall."

Anyway, let's go general. The PHISIX only gained 9 points today. If you look at the daily chart, you'll see that the index is losing momentum as evidenced by declining volatility. I expect the index to move sideways or correct a little from here. Then hopefully, we can continue our uptrend.

Honestly, I haven't been paying that much attention to the PHISIX. Hindi naman kasama sa index stocks ko eh! =)) Well, some lang. Instead, I try to spot the shift in plays. One play ended today and I think another began. It's the play that started it all.. LOLO is back! And it tagged AT and PX along with it.

Let's focus on LC. I like its chart best. Check it:

Do you see what I see? LC now looks like it's accelerating to the upside. I can't adjust the chart but I did some manual computation and I arrived at a 1.3 target for LC. Up, up here we go! Good luck, traders!

Solid!

2011-07-18T20:14:00.000+08:00

Actually, may mas solid pa pero SGI lang ung may tawag na Solid... Hahaha! Joke time na post. =))

New High Plays!!

2011-07-16T14:44:00.004+08:00

Industrials
FGEN

MWC

URC

Service - ICT

New High Plays!

2011-07-16T14:17:00.008+08:00

Properties

GERI

ELI

Financials
MBT

SECB

Holding - DMC

.. excluding the mining plays.

Mining Play

2011-07-13T17:09:00.001+08:00

What's up?? The "A"s were surprisingly stronger than the "B"s today. Could LC be accelerating to the upside already and could MA finally breakout from its two-month range? Mining stocks remain to be in play. PX, SCC and AT look poised to head higher. Let's see...

Momentum, Volume, Price

2011-07-12T19:00:00.000+08:00

Today's superstars were definitely PWR and LC. I don't know what's wrong with meeeeee, hindi ako makaporma kanina sa PWR and LC. I saw several buying opportunities in PWR but I felt a bit uncomfortable since it went up significantly already. I boxed the buying windows in PWR that I saw but didn't take. :( Who would have thought PWR would turn out to be such a monster!

LC, on the other hand, barely corrected intraday. Well, considering it only started moving around 11:15am, I guess that makes sense. The pushers couldn't afford to waste any time. Check this:

GERI tried to be on the limelight but was outshone by PWR and LC. Ang hina kasi sa follow through, GERI. Nakaporma na eh! Maybe tomorrow! Last level of support is at current levels.

You know what I'm doing right now? I'm shaking myself!! Hahaha! Wake up! Wake up! I need to be in tip top shape tomorrow. I've been waiting for this kind of market and it's finally here!! Act faster! Tsupita mode ON!

Anyway, I'm fascinated with trying to figure out the right timing in the lightweight basuras. See, I have a lightweight portfolio too, where I tsupita stocks with low volume. Yesterday, I mentioned plays like the one in BC. :P I spotted another one but, I dunno, there's something about today.. hindi ko nasakyan ulit. Waaaah! I'm talking about TDY. =)) Exotic stocks!! Near the open, I was eyeing at around 4.82 this but I got distracted by PWR. The next time I drew my attention back to TDY, it was already above 5.

I have a theory on how to spot which lightweight basura stock will move next: Volume plus breakout-ish kind of move in price. Volume is important because this raises your probability that the stock will not continue to move sideways because someone is possibly accumulating. To get the timing right, though, you need to pay attention to price so you won't be shaken out just like what happened to me in RFM. To illustrate, here's the chart of TDY. This caught my attention as I was reviewing charts last night.

Right now, I see a good setup in MAC and...EVER! :-ss We have this office joke (half meant) that when EVER moves, that's the end. It's like the ultimate basura so when it moves, that's it for the whole market. :)) Anyway, just speculating... =))

Benguet Corporation (BC)

2011-07-11T18:49:00.001+08:00

Yes, I'm back to basura. HAHAHA! Being a tsupitera is a hard habit to break. Once bitten by the tsupitero bug, there's no going back. Anyway, BC is just a cheap thrill. Ever since I bottom picked RFM, I can't shake out the feeling that basura plays are back! In fact, when I do my post market notes, my watchlist is dominated by basura stocks... Hmmm...

Anyway, my story for RFM is, I bought at 1.14 because I thought there was accumulation going on. But I was suddenly shaken out because of the fear that it can consolidate forever!! So, I sold at cost then after a few days, BOOM! Bye bye! Hello, 1.28. Naman... But BC is another story. I bought last Friday at 20.30. Teehee! Look at the chart. I don't know if you see what I saw last Friday but to me, that was a breakout and today it had momentum and I sold! BC is prone to one day spikes... If it still does go up tomorrow, it's okay. Take your profits and run. I was lucky enough that BC behaved according to expectations. What fun! :) More, please! :)

EURUSD Trade Setup #3

2011-06-10T07:03:00.004+08:00

Trade #2 was stopped -32 pips. Reversed trade to short!

EURUSD Trade Setup #2

2011-06-09T11:43:00.003+08:00

Sold the earlier setup at 109 pips. :) New long entry using H4 charts last night. Off to work!

EURUSD Trade Setup

2011-06-02T19:15:00.003+08:00

Broke 1.4445 resistance. hope the trade continues :) I am a boring fx trader. I do this to keep my TA sanity in place. :D
Performance of my practice account here: http://harleywong.mt4stats.com

MER Trade Setup and PX Trend

2011-06-02T16:04:00.006+08:00

Can't resist the signals...

PX looks like has bounced from its support at 20.2 and high probability of resuming trend. BUT ex-date tomorrow so let's see.

Starting the Month Right

2011-06-01T23:03:00.001+08:00

Can you blame me for being confused? Check this out:

Can I get a "What the hell"? One day extremely bullish, next day extremely bearish, then now, extremely bullish again?! Let's hit it, Britney! ♫♪ "You drive me crazy..." ♫♪

Anyway, the market closed 42 points higher today. At some point during the day, it was up by as much as 65 points. I guess with the forced closings during yesterday's session, today's green shouldn't be surprising. But anyway, great way to start the month. ;)

Hmmm...Well, we all know Mark doesn't know how to follow through. If you look at the chart above, the index has been swinging wildly...down one day then back up the next day (refer to the boxed areas). After a small bodied candle, it takes a dive. Since April, the market has done this two times with the third time happening now. If we follow the same pattern, tomorrow should be an uneventful day as far as the index is concerned. Then a nosedive should follow suit. :-? If I recall correctly, my deja vu scenarios have also been failing. Haha! So, I expect that the market will do something different this time. But let's assume Mark is guilty until proven innocent. :))

ISM Weekly

2011-06-01T14:35:00.004+08:00

I put ISM on my watchlist last week when it closed at 3.11. Yesterday's and today's movement tells me that something is brewing with the group. I am now convinced that the trend has changed. Bought today with an average of 3.74. I'll be more than happy if this bull closes above 4 this week. :)

I'm Back...

2011-05-31T19:14:00.000+08:00

...and all the more confused. :)) But I think Credit Suisse (311) deserves a hat tip. He was today's sweetheart, buying up aggressively stocks like AP and most of all, EDC. Anyway, This is my second day back from my vacation and I'm missing my freedom already. I don't understand how the market works anymore. Hahaha!! Short-term signal are definitely not working. Case in point, ICT. Bullish yesterday, bearish today. What the... Hmm, I thought before I needed a greater tolerance for drawdowns but that's very uncomfortable for me so I still need to find a system that works. Momentum, most definitely, is no longer working. You need to be smarter nowadays. Haha! :P It's like, when you like someone, you can't just keep on chasing that person or else you'll be left hanging, just like the 10% drop in DMC and ICT a few weeks back. ;)) Mark doesn't know how to follow through. He's a very difficult lover.

The usual setups I look for are failing. But I did notice something recently that works. It's a setup that would usually scare the pants out of me but why fight it if it seems to be working? It's a sort of bear trap scenario. I confirmed it this morning when CEB rallied. I found it in AP, possibly in DMC, MBT, and AGI. This setup is characterized by an acceleration of the downtrend coupled and/or a bearish candlestick after a bullish one. A rally follows soon after.

Check it:

2011-05-24T22:59:00.003+08:00

Speculative Bottom Strategy

2011-05-10T22:43:00.001+08:00

I noticed, the longer I've been trading, the shorter my holding period becomes. When I was still starting out, I was a full fledged position trader. My maximum holding period was three months. I never day traded or held a stock just for one day. Well, things have definitely changed. The setups I like now were setups I didn't even dare trade. In momentum trading, I generally believe it's better when the price is located at the highs, and shallower corrections are preferred over deep ones. These days, such a belief system is no longer ideal. In fact, they can just get you killed. You can't just hit anything that moves nowadays because momentum is not always sustained.

I was trying to remember the setups I looked for when I was a position trader. I remember my "low risk" speculative bottom strategy. (Contraditory ba? Low risk but speculative? Haha!) Basically, I look for stocks that have corrected already. Then I look for signs of a slowing downside momentum. I have two buying opportunities:

1. On a small bodied candle (buy as low as you can);

2. When it looks dried up already.

I practiced this yesterday on MPI, EDC and FGEN, to which I got interesting results.

Following this setup, MEG, SECB and PNB looks bullish to me. Now, I'm trying to figure out the ideal holding period in this kind of setup...

All Eyes On You, SMC

2011-05-05T23:32:00.001+08:00

Because I haven't posted anything until today, let me make it up to you by posting a second entry. Aside from the breakdown, today was something special because of SMC. After three weeks, was it? SMC resumed trading today. The shares that were offered at 110.33 were also available for trading. Last week, my officemates and I were thinking that SMC would trade above 110. Oh boy, were we in for a surprise! I noticed SMC during the pre-open when I saw Pau's tweet. He said it was retail vs. the big boys. True enough, the postings only bloated up by the open.

Watching SMC intraday was stressful. It felt like a roller coaster ride. After fighting it out at the open, SMC was able to open at 110 but was immediately met with resistance and was sold down to as low as 108.10. It was then able to rally back to 110 but half an hour later, it was back to 108.10 and even took on a new low of 106.10. Just when you thought it has bottomed out as it was able to rally back to 108 there abouts, it was met with resistance yet again. It broke 106.10, reached a low of 105.70 then boom! It was bought up to close the day near the highs at 109.50.

Of course, the bulls and the bears battled it out at the pre-close too. I wasn't able to take a screen capture of it but around 11:57 am, the bears threatened to close SMC at 106.50! SMC looked like this just before the close:

So, SMC holders, okay pa rin ba mga puso nyo??