Today was a choppy, boring day where I could find few opportunities, despite being fully awake for once. :-) I would have dwelled on it, but the Trading Goddess said to get over it, so I did.
If you track my twitter feed, you already know that I took one trade today, on CVS Corporation (NYSE: CVS). Let’s take a look at it:
What did I see?
- A failing gap up that was finding support above the OR low.
- It was starting to make higher highs and higher lows, and the 5MA had caught up with it.
- Lots and lots of volume (it finished with 302% of its normal volume).
What did I want to see?
- A re-test of the OR high
Unfortunately, I got in a little late. I’d have ideally gotten in at 32.68, but at my actual entry the risk was still well under 1% of the stock price (which is my rule of thumb for how much is too much). And, even more unfortunately, the price did not rise as fast as I had envisioned. When the action started to get a bit dicey about halfway to my target, I bailed. Flat, choppy, friday markets are not the time for blind faith in some trade’s follow-through.
As you can see on the chart, I didn’t get out quite at the top of the move (it topped out about 5 cents higher), but I was correct in assuming we were going to be stuck in that range for a while. Turns out, the stock never ran. So, I am very happy with this trade, overall.
I tossed out a couple other ideas via twitter, but didn’t take any of them, myself. If you were more brave than I was, and quick to take profits, you could have made some nice money on CDWC, for instance. I just didn’t think this was a good day for speculation against the trend, even for a scalp.
I hope your day was profitable! Be careful out there…
| Stocks Mentioned In This Article | |
|---|---|
| Stock | Links |
| CVS |  |  |  |
March 9th, 2007 at 5:19 pm
Richard
I traded FSLR under the same sort of action, but I failed to bail. I learned something I suppose, but your post added more for me to what I deduced… No mans land, time to bail… or more importantly: FRIDAY… Thanks again BP
March 10th, 2007 at 1:26 am
When FSLR failed to push past round number 53.50, and then started making lower highs and lower lows, I’d have bailed around 53.25. Before that, it was obviously struggling with round number 53.00, but it was still making higher highs and higher lows, at least. That’s just what I would do… I’m not an investment advisor!