When does seesaw becomes a whipsaw?

It is when you are whipped for putting chewing gum under a public park seesaw in Singapore.

Today is a day to be cautious.  I sold all my swing trades pronto at open without thinking much.  All for small losses. I even reduced position size on $SZYM with the intent to buy them back cheaper.

So far, all mini-rallies are being countered with a bear attack; therefore if you are thinking about bargain hunting, you may want to put a tight stop “just in case”.

Below is the 1m $SPY chart:

Be safe!

My 2 cents.

 

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Market opened up today and it slowly climbed its way higher till closing time.

Meanwhile, my “current” favorite trading vehicle $AAPL was not participating in the bull trend but instead played defensive all day.  I bought $AAPL twice and twice I stopped out for breakeven.

$DDD was tracking lower all day until a late stage rally brought the candlestick to look a bit better; thus, I jumped back in with a starter position.  I’m preferring to play $DDD over $XONE because with $DDD there are more cluster of bids in the vicinity while with $XONE I had to look further down to see the bids which often times give me vertigo just to look for bids to get out.  You may see a nice paper profit on unrealized gain on $XONE but the moment you try to get out, you can forget that nice paper gain you see if you just want to get out at market.

$FB was trading around the support area so I bought a starter position with a GTC stop below the low of the day.  My stop did not hit so I’m still in.

$PACB was exhibiting some stability so I decided to buy back some position.

Upon browsing through my favorite stocks to trade, I came upon $CHK which looked like it was bouncing off the previous minor correction; so I bought a starter position and later added some more by end-of-day because I felt the price action was strong.

Take a look at $CHK daily chart below and you know what I mean.

Once I was in $CHK, I naturally checked in $WPRT since it was all related to natural gas.  $WPRT also exhibited a possible bottom so I bought a small starter position to test the water.  See below $WPRT daily chart:

I was tempted to dump $DCTH today but since it was still sitting on the support line, I would give it a bit more time.  See where the closing price just sat on the support created back on early Feb?

This was pretty much a slow day actually even though DOW screamed 110 points higher.  The elephant in the room was that $AMRN continued to trek lower.  Since I already covered this subject on my previous post, I’ll just chalk up today as an uneventual day for me.

Current holdings:

LRAD, AMRN, SZYM, TINY, CHK, FB, DCTH, DDD, IMUC, PACB, WPRT and 29% cash.

My 2 cents.

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Some of you may wonder why I’m so stubborn on my $AMRN trade and have chosen to sit through an ugly downtrend instead of abiding by my own discipline of cutting my loss and buying them back cheap.

Well, there is a reason why I call this a “position trade” from the get go.  Remember, I made that decision at the time I decided to load up (averaging up) when I was still in-the-money on the trade.

From the past, I had made similar calls to some of the stocks I believed to be “game-changer” or “visionary” but without the kind of conviction I’ve right now with $AMRN; thus, I loaded up BIG but sold too soon and missed the whole “game-changer” and “visionary” uptrend because I was either too busy or waiting for a retracement that I forgot to follow-through.  So, this time, I said to myself, “I’m not going to make the same mistake with $AMRN.”

Below were the trades I left quite some money on the table:

1) Loaded up on $SNFT (before they changed their name to $NUAN) because I believed their voice recognition software was a key component of technology trend at the time.  My average price was around $3.xx and price gyrating between $2.xx and $7.xx for a long long time and it began to wear me out.  Finally price went back up to high $7 and I threw in the towel by selling all my shares at mid-$7 because I didn’t want to go through the pain of watching it falling back below $7 which I had witnessed so many times.  Price then proceeded to head higher after I sold.  I was too “yellow belly” to buy back at $8 because I didn’t want to give back my gain after a long-period of frustration.  $NUAN is now trading at $20.00.

2) Loaded up on $LNG when it was trading at $3.xx.  At the time, I believed in this stock and its fundamental so much that I literally had a large stake on this one.  I had about 13% of my portfolio betting on this stock and I told myself I would hold this one long-term.  Price shot up to $6 and promptly fell back to $4.  The volatility was insane!  Instead of sticking to my conviction, I sold out when price went back to $5.00 for a decent profit.  While price continued to spike up and down in great speed either way, I lost my appetite after swing-trading $LNG for some quick profit here and there.   $LNG is now trading at $26.00.

3) Loaded up on $BIDU when it was trading at $110.00 before the split.  It was during one of those anti-BIDU sentiment and $BIDU dropped in price from high $300.00 to low $100.00.  Because my conviction wasn’t there, I sold at $130.00 and forgot about the stock.  $BIDU is now trading at $86.12 after split (pre-split would be $861.20).

4) Loaded up on $AMRN when it was trading at $3.xx.  After it went to $7.00, I got nervous and sold it for profit.  Since then, I began to swing trading it for profit.  Then one day, it so happened I did not have any position at the time, $AMRN gapped up to $16.xx and headed to $19.xx before heading back down.  I knew I would have sold it b/w $16.xx and $19.xx if I had held my full-size position.

Now, if I don’t learn from the lessons above, it will be all for naught.  So I told myself that, this time, I’m not going to let this volatility on $AMRN get the best of me.  Therefore, I’m holding this one through the end.  The one thing that allows me to hold this one through thick and thin is that I did not average down along the way.  I set my worst case loss scenario at my original investment (I doubt I will lose the whole thing since they do have a patent on pure EPA (icosapent ethyl); thus, I’m not faded by current $AMRN downdraft.

One more thing, because I made money back then with $AMRN when I loaded up with more shares than I’m holding now, this drawdown is simply my paper loss against my previous realized gain.  This fact does ease my mind in a way giving the current price of $AMRN is in a deep malaise.

Remember folk, this is strictly for position trade, I hold no such tolerance and conviction when it comes to my swing trades.  Swing trade is strictly for profit-taking when you see it.  Since the position size is much smaller, missing the runners here and there is part of the game.

My current position trades are: $LRAD, $AMRN, $SZYM, & $TINY and I intend to hold these as long as their technological fundamentals remain intact.

My 2 cents.

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Look at the daily $FB chart below.

Today is an up day after landing on the support zone.  When I see price action acting positive on a support zone after a downtrend, I consider it a low risk trade in trading a bottom.  I buy with a stop below the day low which often gives me a low risk trade.

 

Needless to day, I bought a starter position on $FB with a stop below intra-day low.

My 2 cents.

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This morning the market had one of those day where it woke up with wood but was quickly dampened by noise of a crying baby next door owned by an European family.

“Waa! Waa! Waa! Give me my f***ing milk or I’ll cry till you…”

Anyway, $AAPL opened up and I added some more for the ride.  I wanted to get back on the uranium sector so I thought today would be the day.  I bought a starter position on $CCJ and $URA after seeing the charts were all pointing up like they were going to break out to the upside.

$BBRY gapped down and I did not have any regret for closing out my short position on Friday because $BBRY was known to bounce violently from time-to-time.  I was quite content with my profit from Friday so I didn’t see the need to gamble that win on an overnight roll-of-dice.  Seeing more than a point down at the open, I watched the chart to look for some stability and bought a starter position looking for a dead-cat bounce.  Using my trusty 15m, 3m, and 1m charts, I bought when these three charts aligned together to yell out “It’s a GO!  Buy now ZEN!”.   Hearing the signal, I bought and was fortunate to catch the dead-cat bounce.  I used a trailing stop to follow the price action and was later stopped out for profit.

$CGEN looked like it was bouncing and despite my better judgement, I bought a starter position thinking that it could run up fast on thin volume and I would be quick to dump it for a tidy profit.  However, after some times in the morning, I looked around and couldn’t find the patsy running up the price.  “Oh Sh*t!  I’m the patsy!”  Without thinking twice, I dumped my position for a small loss.  I deserved this loss for being such a smartass.

Then the market started to turn.  Before $SPY price action became a waterfall, $AAPL was struggling at the top so I decided to sell my lot to lock in profit before giving back the gain.   Then the next down bar happened on $SPY on a 3 min chart and I had this bad feeling that it might become a waterfall price action.

Not to deny my intuition (or feeling of impending waterfall scenario), I started to unload my swing trade positions.  I checked $CUR and it was not pretty so I dumped it to cut my loss.  $CDXS was showing the same unpleasant picture on the chart so I dumped it as well.  $DDD had been struggling since the open so I decided to sell it too to take the small loss before it became a big loss.

$PACB was hitting Friday low and I sold it too.  With the $SPY continuing its trek down, I was scanning my portfolio to see what other swing trade position I had.  I saw $GLOG and out it went.  Then I saw my newly minted $CCJ & $URA; nope, they had to go too.  I stopped at $DCTH and I still saw that massive bid sitting there at the low.  I was very tempted to hold but then I was in the “firing” mood; so I said, “You are fired too!”  Bang! Out it went.

By the time I had fired all my swing trade positions, I had 50% cash along with my core position trades- LRAD, AMRN, SZYM, & TINY.

I was feeling good to sit on the cash and  I went away from my desk for awhile.  When I came back I saw $DCTH was trekking higher.  “Darn! I knew it!  That large bid was there for a reason.”  Not to be denied a rally, I decided to buy back my $DCTH position.  Then I saw RC post in which he mentioned of holding $IMUC.  I checked the chart and it looked pretty good giving a down day today.  I had $IMUC before and I was actually thinking of buying it back when the chart looked better.  And there it was, a better looking chart when all others were taking a dump.  So I bought a starter position on $IMUC.

During the slow grinding state-of-being the rest of the day, I made one long $AAPL trade for a bounce but sold it for small profit when my 3m  & 1m charts started to act up.  From then on, I sat on my hand and stopped watching the market.

Overall, I had a good morning banking coin on $AAPL and $BBRY.  I also “fired” a lot of swing trade positions but was convinced to hire back $DCTH.  I’m giving $DCTH one more day (tomorrow) to prove itself.

AMRN continued to give me heat but LRAD was being a great pal by blowing ice cold air to balance out the portfolio.

Current holdings:

LRAD, AMRN, SZYM, TINY, DCTH, IMUC and 45% cash.

My 2 cents.

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Take a look at the 15m $SPY chart below:

The market opened and rose up nicely and then had a waterfall price drop to show for the day.  If you are not annoyed then I take my hat off for you.  But my internal radar alerted me to move to cash; therefore, I spent all morning liquidating all my swing trades position and raised my cash to 50% as well.  (I said ‘as well’ because I just read The Fly posted that he was also at 50% cash.)  Thus, in a manner of speaking, I fired all my swing trade positions today.  However, due to an incessant pleading from $DCTH, I hired it back for a temporary basis to see if it can prove itself to make me some dough.

Take a look at the daily chart below, if the bear has its way, price action may just as well drop below the GW1 support.  Sometimes, it is better to be safe than sorry.

Be safe!

My 2 cents.

 

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I’m sure most of you know what it is like to be a boss or an employee.

If you are not the boss, then all your effort goes to please  the boss.  And if you are the boss, all your effort goes to manage the employees.  And if you are the middle manager, then you have to please your high up and manage those below you.

Well, guess what, investing is pretty much about the same thing; but there is one big distinction.  It is YOUR money you are investing: therefore, YOU “should be” the BOSS.

Aha!

I added the “should be” not for effect but to reflect how we let the employees (aka stocks) get away with not doing what they are hired to do- to make you money.

For those who are or were bosses, you know what I’m talking about.

On one extreme, if you are a tough boss, you pretty much have a strict guideline for the employees to follow.  And if your employees don’t follow those guideline, you write them up and inform them of their deviation from the guidelines.  And if they ignore your written warning, they are setting themselves up by providing you with reasonable ground for termination.  Simple at that.

Now…

On the other extreme, if you are an amiable boss who care more about the employees than your company’s mission, you may become too lenient to your employees who are not productive, not fit for the job, not being a team player, and worst of all, do not have integrity.  You become more susceptible to manipulation by the employees who are good at kissing your behind…

Before I go on, to be fair, there are excellent bosses out there who are both amiable and tough at the same time.  And these are the bosses all companies are lucky to have.

Well, I think you have a pretty good idea of where I’m going here.

It is interesting that while most of you are/were tough bosses in the business world, you become quite an amiable boss with your stocks.  Hmm…

Why do we, as an investors, tend to become the amiable boss who let our stocks get away with non-performance?  Why don’t we just fire the stocks the way Donald Trump does it in the video below?

Come on now, if your mission as a trader (aka your organization) is to make profit from swing trade/short-term trade, your job is to fire those stocks that don’t perform.  In other words, you need to be an extreme tough boss if you are a swing trader or short-term trader.  Otherwise, you are letting your employees (aka stocks) do what they please as your company’s expense (aka your portfolio’s expense).

Hence, firing nonperforming stocks = cutting losses.

Here are some thought that may help:

Scalper: stocks are like temp; if they don’t perform, replace them immediately.

Swing trader: stocks are like new employees on probation; if they don’t perform, let them go before the probation period expires.

Position trader: stocks are like project managers; if your have sufficient evidence that the project manager is not working out after a period of time, replace the project manager.

Whatever you do as a boss (investor/trader), do NOT become the boss as shown in the video below…

In other words, do not fall in love with your employees (aka stocks).

My 2 cents.

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Today trading was quite thrilling in a manner of speaking.

Let’s started with the market open.  Market opened higher and I was tickled to see my prediction came truth because I told myself that SP500 would open higher when it was printing a negative 2.50 last night.

Immediately I checked $DDD to see where it was.  It gapped higher and I placed an order to add more and got filled at $31.7x.  Then I checked $BBRY and saw the it was printing strong.  I added a bit more and got filled @ $16.5x.

Lo and behold, right after I bought $DDD, price began to fall off and I was going, “You’ve got to be kidding me!”.

Without thinking, I sold 40% of my $DDD holding to lock in profit just in case the downdraft became a waterfall price drop.  Remember, I came in the morning with profit from yesterday run-up.

I checked $DCTH and saw it was not acting well, so I sold half of my position to lock in some profit and minimize my exposure.  Since my position size was no longer large enough to threaten me when price was gyrating around in the negative territory, I left it alone.  I was also comforted by the fact that there was a large bids sitting at the support price level.  This told me that a big whale is trying to accumulate for the next leg run-up.

$PACB was trading the same way $DCTH was and since my position was not large, I left it alone as well.

Price began to bounce up again on $DDD so I bought back half of what I sold earlier.  At the same time, $XONE was also acting well so I added to my position.

Then $BBRY began to hesitate on its price movement, I sold immediately to capture the small gain.  After I sold, $BBRY began its trek up.  Not to miss the rally, I went back in with a tight stop but it was for naught since I was stopped out not long after I got in.

$DDD continued to head higher and took out the intra-day high in the process; so I added some more.  But then, by mid-day, $DDD broke thru the 3-min uptrend line with a sudden drop in price.  I immediately sold my whole lot of $DDD to lock in profit.  I sold $XONE also to lock in profit as well since it also exhibited a sudden drop in price.

Then $AAPL captured my attention.  It began to trek up while others were correcting.  Sensing a coming rally, I immediately bought $AAPL and was glad I did.  Price took off not long after I bought.

$DDD began to stabilize so I bought back the position size I came in this morning.  This time I let it ride without further interference since I wanted to hold it over the weekend.

$BBRY, meanwhile, was behaving defensively the whole time while $AAPL was climbing higher.  Price began to go under the 79 & 89 ma so I shorted a starter position with a tight stop above the ma lines.  Prices bounced back up and I was stopped out for small loss.  Then prices fell off below the ma lines again but I did not try to short again because it was trading near the $16 which I saw as a strong support line.  Why chase when the profit potential was minuscule (being so near the support line)?

Then the unexpected scenario happened; $BBRY broke below $16 support line and all hell was released.  I immediately shorted $BBRY because the $16 support was gone and it took out yesterday low.  This time I shorted a larger position than earlier and used a trailing stop to protect profit.  The fall was incredible fast and my trailing stop was not hit even though I kept moving it down to track the falling prices.  By the time I was stopped out, I locked in over $1/share in profit for the run.  I tried a few more re-entry shorts with a much smaller size position afterward and ended with a small loss and win which pretty much offset each other.

There there, although I missed the gap up on $BBRY only two days ago, I was made whole with today action.  So you see, if you miss the boat, there is always another one waiting for you if you know where to look.  So, don’t sweat it when you miss opportunity because you cut your loss quickly.

$AAPL meanwhile, kept going up but because I moved my trailing stop too close, I was stopped out with profit near the high.  I waited for the minor correction at the top to settle down and by the end of the day, the mini-rally near the close convinced me to jump back in for the overnight hold.

While I had a good day on my swing/day trade; my portfolio kept on taking heat from $LRAD & $AMRN downdraft; but I wasn’t a bit faded by this portfolio balance change.  The way I look at it, as long as I keep up with a net win on my swing trading, I should be fine.  I simply don’t mix my position trades result with my swing trades result because, in my book, one has nothing to do with the others.

Why wouldn’t I take my loss on the position trades and buy them back cheaper, you may ask.  It is because I’m making a heavy bet based on an unexpected news that could drive my position trade up with no warning.  That is the kind of play I’m waiting for; therefore, I’ve to suck up any heat I may be taking now.

E.g. With $AMRN, any surprise news regarding NCE, takeover prospect, positive prescription demand, etc can drive the price up overnight with no warning.

And thus end another week of trading…

Current holdings:

LRAD, AMRN, SZYM, TINY, DDD, CUR, AAPL, DCTH, GLOG, CDXS, PACB and 33% cash.

Btw, I log-in my trade activities within a reasonable time in my twitter account, you can see them here: @tradingmy2cents

My 2 cents.

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With $AAPL restoring back to its darling status, who needs $BBRY?

I saw weakness in the $BBRY all morning and failed one short attempt; but when $BBRY breached the $16 level, that had to be the tell.  So I shorted $BBRY again.

Look at the 3m $BBRY chart below.  Did you see the waterfall price action?  I love waterfall price action when I’m trying to short; and I loathe waterfall price action when I’m long.

Take a look at that beautiful waterfall from the courtesy of $BBRY:

I guess rumor of $AAPL launching new iPhones in the summer isn’t helping the Blackberry trees…

My 2 cents.

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Today $SPY bounce confirmed the solidity of Giant Wall One as a support.  Thus, price action is now consolidating inside the two Giant Walls.

I see this as a confirmation that the bear is not winning the war here; otherwise, $SPY would have fallen under GW1 and created widespread panic.  Last night before I went to bed, SP500 was printing negative 2.50 but I told myself that I would wake up to see a positive SP500; lo and behold, I was right.  Why would I think that?  That is because I see the GW1 as a huge support.  You see, these two mythical walls from 2007 and 2000 hold a lot of psychological power among us simply because of its historical significance.  Thus, each of these two walls can either be a powerful resistance or support.  It just so happen that these two walls are in the vicinity of each other that we have a twi-wall zone that holds such unfathomable power.

Consider ourselves lucky to be witnessing such historical price interaction inside these two mythical walls.  Due to the steeper angle of this current rally, my money is that we are taking out GW2 shortly.

Take a look at the daily chart below and you will understand where I’m coming from:

My 2 cents.

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