Early on, it looked like I might break through my undertrading barrier today. Several of my watchlist items were sending me alerts. But, as it turned out, most were not tradeable. Let’s see ‘em…
First, National Oilwell Varco Inc. (NYSE: NOV) gapped through my target of 64 on the open. If it were a small gap I’d consider my trading options, but it had gapped all the way to open at 65.50, and approached 68 within the first 20 minutes of trading. So, so much for NOV… I’m noting now that it closed at 64.20, so if it bounces off 64 tomorrow I may get in. Then again, it may be trying to close that gap…
Next, Ceradyne Inc. (Nasdaq: CRDN) tapped the highchartpatterns target of 50, but didn’t trade in a way that triggered the trade. It made a couple half-hearted tries to re-reach 50, but gave up by noon. So, again, close, but no cigar.
Next, Garmin Ltd. (Nasdaq: GRMN) fell through highchartpatterns target of 95, and triggered the trade. However, it fell so fast my order did not fill, and I’m convinced I would have been screwed on a market order in that action. So, I had to sit this one out. That’s a ten-minute candle, where it falls from 95.65 to 92.07 and climbs back to 94.12. That’s volatility!
Seeing that Akami Technologies, Inc. (Nasdaq: AKAM) gapping up, I changed my view of it from short to long, chosing an entry point above 37.40 based on the weekly charts. When I was out at lunch, I got the email that said it traded at my price. Man, I could not get a break! But, I checked with my blackberry a few minutes later, and saw that it had already fallen to 36.20 again. So there wasn’t even a trade to miss! What a frustrating day! But, I’ll note that it closed reasonably strong at 36.83, so any kind of healthy follow-through tomorrow has a chance to get me into the trade.
So, after I got back home from lunch I made one trade, in United States Steel Corporation (NYSE: X). I got 1.5R out of it. You can see my sloppily scratched blue lines marking my entry and exit.
Unlike yesterday’s 1R loss scenario, I tried to be very aware of whether I felt a need to take profits, or if I feld that the trade was turning against me. You can see that the exit candle closed near its high (I think these are called Doji’s when they close at their open prices, but I don’t believe in the named candle patterns intraday). So, when it was steadily climbing, I decided the stock could reverse. The markets where positive/negative/positive see-sawing in the afternoon. Eventually, you can see that the stock made lower lows by the close, but I would have stopped myself out at breakeven before that, in the candle after my actual exit. So, I am pleased with my choice.
I hope everyone had a good trading day!
On Pivots
After seeing a note yesterday on Trader-X’s blog, I was reminded that I have been meaning to see what pivot points can do in sideways markets. I had read about a pivot strategy for flat markets in a book a few months ago. So, last night and during today’s session, I kept the standard pivot points overlayed on my charts. At first glance, it does appear to be uncanny the way they line up with the actual price action. I know the formulas for the pivot levels, and I can’t think of any reason why they hold so well. One explanation, obviously, is that enough traders use those pivots to make them a self-fulfilling prophecy. Another explanation, is that my eyes are drawn to spots where the prices and the lines match, and I unconsciously ignore all the places where there is no correlation whatsoever. More investigation is needed.
| Stocks Mentioned In This Article | |
|---|---|
| Stock | Links |
| NOV |  |  |  |
| CRDN | | | |
| GRMN | | | |
| AKAM | | | |
| X | | | |
July 30th, 2006 at 2:16 pm
You are Great! A honest person. You are not alone. I have made every mistake you habe written about.
July 30th, 2006 at 3:36 pm
@Joseph: Thanks for the kind words. Over time I’m sure we will all be making less mistakes. Or, at least, different ones!