Ragin Cajun Saves my Bacon

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I took 7 trades today: 2 wins for +7.1R, 4 losses for -4.4R, and one scratch. The only reason I came out ahead today was a setup called out by Ragin Cajun for ISRG on Wallstreak (his blog is here, go check it out).

He noted that ISRG should explode today. I looked at the daily, and I thought that the base looked good:

Yesterday there was a single tick that traded at 237-ish that might have been bogus (TD’s datafeed blows). So I watched it. ISRG sold off big at the open, all the way back down to 233, where it spent most of yesterday. I set an alert for 234 and went on to other things. I lost -2R trying to scalp BIDU and got +1R back from it, and decided to leave it alone. My alert went off, so I entered from this 5-min chart, with a stop 1 point away at 233:

ISRG went to the moon! When we were at 238, near the pre-market high, and we stalled, I sold half. When we blew up to 243, and began to retrace I sold 1/4. There were two big wide range bars on the 15 min, so I thought that would be the end, but I wanted to keep 1/4 of the position on as a swing. At about 2:00 ET, the markets began to sell off, so I moved up my stop and sold the rest at 240.51, for a total of +6.2R on the trade. Thanks for the setup, Ragin!

I went on to lose another -1R and scratch in CSUN and JRJC, trying to chase China names. Sloppy!

My final trade was in LDK, a solar stock that Wallstreakers have traded in the past. Apparently, their CFO left or something. I don’t see the news out there yet, but some on Wallstreak said that was it. In any case, they were running for the exits! Look at the carnage on the daily:

I immediately thought SS parabolic long. I watched this 1-min chart, and as downward momentum diverged and we broke a green hammer, I went long with a 1 point stop:

I held on too long, but I stuck with my original stop at least and only lost -1R. I shouldn’t have stuck around more than that first red candle. A parabolic trade should launch back up. When it failed twice, I should have bailed at my entry. Despite my mistake, I think it was a good play, but we just got another wave of selling in. Stuff like that happens! I’m more upset about my gunslinger trades in BIDU and the China names from the afternoon. Skyb0x from Wallstreak actually went short in LDK about the time I was stopping out. Here’s his notes on his trade, and a chart that I annotated:

Wild day out there. I traded more than I intended to!

EDIT: Here’s a tick chart of the day’s action in LDK. Notice that the first decline of the day was met with much more volume on upticks than downticks. I was really surprised that the volume wasn’t more unbalanced on the big drop at the end of the day. What does this mean, if it means anything at all? Still thinking. Comment if you have any ideas:

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com