I've been out of sorts. First off, the rookie mistakes (not that I'm not one), and then the buying of wrong tickets. So I'm going to take a short break to calm the mind, maybe play some chess and get the thought processes in order.
Before we go though, I've got a lesson from Shifu Ang to write down - the Seesaw.
Previously I asked how to identify if the next day's a seesaw. Shifu Ang answers: "When the 3-day and the 15-day Force Index are showing different results."
Now, a few days and I'll be back. I hope.
Sunday, May 2, 2010
30 April 2010 - Yanlord
Last night Shifu Miyagi Ang messaged me and told me to cover as soon as I reached the office. He gave me a quick lesson the Force - when it's at zero, there's a POTENTIAL that it will bounce off strongly.
That means I'm in trouble. And when you're in trouble, you think of an exit strategy.
Then it hit me - if it turns off strongly, then I can convert my short position to a buy and ride the wave up. Unfortunately for me, the key word is POTENTIALLY.
Let's get a lesson:
Most of the time we trade within the ATR. That means we're looking at volatility and take the movements within a small range within a ranging trend. That also means we'll hopefully be taking in many small wins that add to good month. Lastly, that means seldom is the big up or down going to come and hit us.
For a run to happen, we'll need all the Force Index on all of the day periods to be at zero (3-day, 15-day and 250-day FI). Even then we'd expect a few days of shaking to get a pure market ready and hungry to capitalize on the first hint of interest.
So with that in mind, let's see what happened on this day.
The Breakdown:
Chart from Yahoo Finance
Fig. 1. Yanlord Intraday Chart, 30 April 2010
So the day came and I covered at a good price - $1.71. Taking a look at the volume, the chart showed a good volume which to me meant that the rebound might have come. With the whole market green, the reasonable decision then would be to switch positions.
Mr Shifu Miyagi Ang told me the evening that it's wrong to have to make a decision right after a bad one (or if you just rescued yourself from a disaster). Position switches should come after a successful run where you ride the corresponding waves up or down.
Let's remember the kinds of traders featured in Shifu Miyagi's earlier post.
So another bad decision - buying at $1.71. Volume soon slowed and then I had to cover again. This time at $1.71.
An observation though - the day's price got higher as shortists covered at the end of the day, which told me generally that if shortists are to cover on Friday, the price will typically rise towards the end where they turn desperate sellers.
Yanlord
Opening Price: $1.71 (+$0.03)
Previous Volume: 8,200 (VPH: 1,265)
Closing Price: $1.72 ($+0.01)
Closing Volume: 9,860 (VPH: 1,517)
Price Acquired: $1.67 (Shorted)
Lots Acquired: 11
Break-Even Price: $1.68
Price Covered : $1.71
Transaction Cost: $104.11 ($51.44 + $52.67)
The Loss: $544.11 (-$0.04)
Price Acquired: $1.71
Lots Acquired: 11
Break-Even Price: $1.72
Price Sold: $1.71
Transaction Cost: $105.34 ($52.67 + $52.67)
The Loss: $105.34
The Score So Far: -$3,154.90
That means I'm in trouble. And when you're in trouble, you think of an exit strategy.
Then it hit me - if it turns off strongly, then I can convert my short position to a buy and ride the wave up. Unfortunately for me, the key word is POTENTIALLY.
Let's get a lesson:
Most of the time we trade within the ATR. That means we're looking at volatility and take the movements within a small range within a ranging trend. That also means we'll hopefully be taking in many small wins that add to good month. Lastly, that means seldom is the big up or down going to come and hit us.
For a run to happen, we'll need all the Force Index on all of the day periods to be at zero (3-day, 15-day and 250-day FI). Even then we'd expect a few days of shaking to get a pure market ready and hungry to capitalize on the first hint of interest.
So with that in mind, let's see what happened on this day.
The Breakdown:
Chart from Yahoo Finance
Fig. 1. Yanlord Intraday Chart, 30 April 2010So the day came and I covered at a good price - $1.71. Taking a look at the volume, the chart showed a good volume which to me meant that the rebound might have come. With the whole market green, the reasonable decision then would be to switch positions.
Mr Shifu Miyagi Ang told me the evening that it's wrong to have to make a decision right after a bad one (or if you just rescued yourself from a disaster). Position switches should come after a successful run where you ride the corresponding waves up or down.
Let's remember the kinds of traders featured in Shifu Miyagi's earlier post.
So another bad decision - buying at $1.71. Volume soon slowed and then I had to cover again. This time at $1.71.
An observation though - the day's price got higher as shortists covered at the end of the day, which told me generally that if shortists are to cover on Friday, the price will typically rise towards the end where they turn desperate sellers.
Yanlord
Opening Price: $1.71 (+$0.03)
Previous Volume: 8,200 (VPH: 1,265)
Closing Price: $1.72 ($+0.01)
Closing Volume: 9,860 (VPH: 1,517)
Price Acquired: $1.67 (Shorted)
Lots Acquired: 11
Break-Even Price: $1.68
Price Covered : $1.71
Transaction Cost: $104.11 ($51.44 + $52.67)
The Loss: $544.11 (-$0.04)
Price Acquired: $1.71
Lots Acquired: 11
Break-Even Price: $1.72
Price Sold: $1.71
Transaction Cost: $105.34 ($52.67 + $52.67)
The Loss: $105.34
The Score So Far: -$3,154.90
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