Swing Trade Ideas for the coming week
1 year ago
Entries and psychology
Observations
I am noticing a tendency in me to enter a trade as soon as I exit one. Especially if I take a profit. Looking at cash seems to make me want to trade. As if some thing needs to be done. I start looking for trades and usually do not do well in such a frame of mind.
I did not make a trade immediately after exiting a position. Instead I am looking at stocks to enter either short or long tomorrow or later.
I need to have some stocks on hand to enter when cash is available and the market trend supports my trade.
Entered a short position (PDLI) after six down days in the market. The stock bottomed and then rose along with the market. It looks like the stock gives out a big dividend which is attractive for the longs. Holding it short means I could take a loss for the dividend.
Entered a long position in HL after it crossed the 50 MA for a day trade.
I entered the trade late in the day since I was not at the desk when market opened.
The stock went up and then stalled with the market. A good opportunity to exit and re-enter at support.
The stock then rallied towards the end of day making my exit sub-optimal.
Entered a long position in COGT since it was acquired by 3M for $10.50.
The reason for entry was that the acquisition price sets a floor and the upside is another company offering more (3PAR by Dell and HP is an example).
The exit was reasonably good. A better exit would have been to set it above pre-market high by a couple of
cents. The stock rallied towards the close similar to HL in the previous trade.
The challenge in trading today was that the Dow was tanking through the day so not much conviction in the buyers.
Entered a trade in SKS on rumors of takeover. Mentally I was really tired and did not have the alertness to trade so made a mistake of trading in the wrong frame of mind. I did not look at the daily chart to see a bearish trend. On the daily chart the trend was going down since open. The futures were down before open and the market tanked for most of the day and recovered in between. In all it was a bad entry and a poor trade management since there was no stop in place and I did not place an exit both towards the down and upside.
Review:
I reviewed the trading performance over the past year and saw that:
1. Losses are much larger than profits.
2. I held onto to losing positions longer than required. Exiting the same day would have decreased the losses.
Lessons:
- Do not enter into a short position when the market has been down for multiple sessions.
- Find out whether a stock is giving out a dividend soon since this is a risky short to hold till dividend date.
- Cut losses short and close a losing trade the same day. The trend assessment was wrong so its better to close it and move to another trade.
- Follow steps of entering a trade: Futures, stock chart, financial, news in that order.
Entries:
The short entry was not really required since there were long opportunities in strong stocks. Entering into a short when the stock had tanked a lot makes less sense since the risk is high that the stock recovers. The downtrend should continue into the next two days else it means the stock has bottomed and could rise in the short term.
Exits:
My exits need to cut losses when positions go against me after a 30 minutes of entry.
Exiting when the market is strong does not make sense.
Exit when the stock and the market stalls.
Exit at Fib levels.
ESCA
Monthly chart
Weekly chart
Daily chart
The stock is in an accumulation phase.
Buy signal: When stock breaks $5.00.
Upside target: $8.00
Business: Escalade, Incorporated engages in the manufacture and sale of sporting goods and office products in the United States, Mexico, Europe, and Asia.
Risks: Products are consumer discretionary. Earnings outside US should be good while earnings in US could be at risk in a slow economy.
Insider purchases: Director purchased shares in June 2010.
Insider own: 41% (+)
Institutions own: 5% (-)
JASO
Entered JASO at 5.18 with a market order. I did not look at signals or 1-min chart. Just put a market order since it was moving up and I wanted to catch the move. The stock moved up a few cents and I was looking at 200 in profit. Put an exit for 400 profit (when all I needed was 200) and then watched the stock go down the entire day. I took a loss a few months ago in this stock and I knew that the stock was not strong in its up moves. Either I should have exited immediately with a profit or entered a few cents lower to exit with my profit goal. Did not do either and I am holding this position over the weekend. Looks like I would have to take a loss next week simple to get out of this position and protect my capital.
Lesson: Do not trade when you are not in right mindset and with all the process in place.
read financials before entering a trade
Read, read, read. RPRX is insolvent. Why enter such companies?
RPRX bad entry
I entered RPRX during a pump at 1.02 and set the exit at 1.25 which it did not hit. The entry was bad since the chart does not show a accumulation of any sort.
The follow up on this entry was to either exit at end of day and take a loss or set a sell limit just above the buy price of 1.02 and expect it to hit when it rallies. It did rally a few days later but my sell order was not set and I am still bag holding.
BLC short
Shorted BLC at 6.75. The chart and the market looks to be going down.
Exit placed at 5.54.
2/9/10: Shorted BLC at 6.50. Set exit at 6.32.
2/9/10: Shorted BLC at 6.50. Set exit at 6.32.
Shorting
Today I took a short position in XIDE due to its loss of the Walmart contract and the chart showing downward movement. Shorted at 5.90 but did not cover at 5.55 which was my target. The stock has since rallied back and I ended the day negative. I should have set a stop loss and also set up my initial exit as soon as my entry was filled.
Lesson: Enter a sell order as soon you enter a position.
Follow up: Placed a cover order at 5.55 which triggered today. Not repeating this mistake again.
Watch DOW and S&P charts
On Friday I entered a position in PMCS and saw it break supports and head lower before rebounding at the end of the day. I then pulled up the DOW chart and saw that it mirrored DOW minute by minute. The entry was impulsive and fortunately I am not a huge amount with such lazy entry. My charts were not set up and I didn't follow any method but just took a position.
In hindsight it would have been better to watch the DOW and figure the day's trend and either stay out or short when it was going down instead of blindly jumping in when most of the stocks in my watch list were heading down.
trading blues
The past few days I haven't been on the ball. Slept late one night and the next morning and the day after that I could not be active and focused. I let trades get away from me. Expecting too much from a day (RPRX), not covering optimally (BLC), and not setting a good exit today (EK). Looks like I need to take a break for a few days and then be back. For now I am holding RPRX which is down 20%. Exited BLC sub-optimally, and looking to exit EK by EOD.
Charts
Notes: A good stock that moved up on a down day for the DOW. Should have re-entered the position.
Follow up: Look for a short opportunity.
Notes: ISR was a day trade. Did not take the full run up of the trade but the intra-day movement was choppy so decided to exit with a 20 cent gain.
Follow up: Need to keep on watchlist for consolidation and move up.
Follow up: Need to keep on watchlist for consolidation and move up.
Notes: I did not follow after my exit. The candles on the next two days were not convincing.
Follow up:However, it took off on the 14th for a good run. Opportunity for a short at 13.5.
Notes: Entry and exit was good for a day trade. Chart approached 70 RSI and hence the exit.
A follow-up short was on since the market had sold off.
Notes: (TGB) A follow up short should have been put since the RSI turned down with volume.
Notes: The exit while not optimal was good enough.
Follow up: Should have followed up with a short since RSI was crossing 70 downwards with MACD decreasing.
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