I mentioned that X could be a decent dip buy the other day. I neglected to check to see when earnings were reported. Well...they report tomorrow. So, my outlook changes, since i don't hold into earnings and negative earnings could drop the stock pretty quick.
That said, keep an eye on the lower trend line, which is also around the 50 day ma, about $26.75. It could bounce off this level for a point or two.
~JP
Monday, January 30, 2012
Sunday, January 29, 2012
VZ, HPQ, NLST, X
Hi All, I expect a bit of a pull back in the markets short-term. Therefore, I will be looking for dip-buy opportunities. Its important to not jump right in and buy if the buy targets hit. Consider how the market is acting, how the sector is acting, and how the stocks are acting. If you do buy, don't ignore your stop price. Protect your capital.
Here are a few new ideas that you might buy on a dip.
VZ - All the support and trend lines have me keeping an eye on the $36.50-$37 area. It may take a few days to get there. My optimal buy price is $36.50 with a stop just below $36. The company had earnings on the 25th and sold off a bit on them. I think they may not have been as bad as some would think. Plus, they still have a strong dividend. The daily stochastics, MACD, and RSI are all in the oversold ranges. With a buy at $36.50, I have a target at around $38.50, or $2 (aprox. 5%) profit. Risk $0.50 for $2 potential.
HPQ - I'm watching the $27-$27.25 area for a dip buy on HPQ. The stock broke out of a short-term coiling pattern and tested its 5-6 month highs. It looks like it may test that breakout. The 20 and 50 day moving averages are just below this $27 area for additional support. With a buy at $27, my stop is around $26.25 and a target around $30 (or 200 day ma).
X - I took a trade in X last week as it broke out of its resistance on Wednesday. I bought around $29.10 and sold around $30.25. I still think there is some opportunity in this stock. It pulled back to the $29 area again and popped off that level on Friday. If the stock starts weak and ends strong (red/green) it might be an good sign to get in for a continued move upwards. The 200 day ma is lurking above at just over $33, which would be a good target.
NLST - There has been some good strength in this stock recently. I missed my last call to buy in the $2.79 and $3 areas for the move to $3.50...ugh. But, I'll be watching for this $3.15 area to hold and bounce for a continued upside. The 50 day ma may have to catch up with the price on this one as it seems to be using this average as support.
Please leave a comment!
~JP
Here are a few new ideas that you might buy on a dip.
VZ - All the support and trend lines have me keeping an eye on the $36.50-$37 area. It may take a few days to get there. My optimal buy price is $36.50 with a stop just below $36. The company had earnings on the 25th and sold off a bit on them. I think they may not have been as bad as some would think. Plus, they still have a strong dividend. The daily stochastics, MACD, and RSI are all in the oversold ranges. With a buy at $36.50, I have a target at around $38.50, or $2 (aprox. 5%) profit. Risk $0.50 for $2 potential.
HPQ - I'm watching the $27-$27.25 area for a dip buy on HPQ. The stock broke out of a short-term coiling pattern and tested its 5-6 month highs. It looks like it may test that breakout. The 20 and 50 day moving averages are just below this $27 area for additional support. With a buy at $27, my stop is around $26.25 and a target around $30 (or 200 day ma).
X - I took a trade in X last week as it broke out of its resistance on Wednesday. I bought around $29.10 and sold around $30.25. I still think there is some opportunity in this stock. It pulled back to the $29 area again and popped off that level on Friday. If the stock starts weak and ends strong (red/green) it might be an good sign to get in for a continued move upwards. The 200 day ma is lurking above at just over $33, which would be a good target.
~JP
Monday, January 23, 2012
Trade Review - HPQ, STAA, PEIX, NLST, VLNC
This is an update on my recent actions.
HPQ - I sold my stake in HPQ after it hit my target of $28.50. I took about 7% from $26.67.
NLST - I'm kicking myself because I missed my entry at $3 today. This made a 10% move today and could see more tomorrow. I didn't want to chase it, so I'll just watch it go.
STAA - I put a buy order in for this stock at $10.69 before I left for work this morning. I felt it would bounce off these support levels. The trade triggered while the market was dropping this morning. The stock closed close to its lows today, so if it doesn't hold those levels, I'm going to be out pretty quick.
VLNC - I wasn't seeing any movement in the morning, so I sold on a weak bid at $1.06 from $1.05 add on Friday.
PEIX - I bought into this stock this morning on strength at $1.19 and sold half shortly after at $1.25. I had a stop order placed for $1.19, which triggered while on my way to work. Unfortunately, I sold the second have at the low of the day. The close looked fairly strong, so I took a new position at $1.23....we'll see how it reacts tomorrow.
I also took some stupid trades for losses. TVIX and CONN didn't work out too well. Sometimes, you just need to walk away from the computer to avoid over-trading. Overall, a down day for me...I need to pace myself and stick with the best setups. NLST and PEIX should have been all I needed today.
~JP
HPQ - I sold my stake in HPQ after it hit my target of $28.50. I took about 7% from $26.67.
NLST - I'm kicking myself because I missed my entry at $3 today. This made a 10% move today and could see more tomorrow. I didn't want to chase it, so I'll just watch it go.
STAA - I put a buy order in for this stock at $10.69 before I left for work this morning. I felt it would bounce off these support levels. The trade triggered while the market was dropping this morning. The stock closed close to its lows today, so if it doesn't hold those levels, I'm going to be out pretty quick.
VLNC - I wasn't seeing any movement in the morning, so I sold on a weak bid at $1.06 from $1.05 add on Friday.
PEIX - I bought into this stock this morning on strength at $1.19 and sold half shortly after at $1.25. I had a stop order placed for $1.19, which triggered while on my way to work. Unfortunately, I sold the second have at the low of the day. The close looked fairly strong, so I took a new position at $1.23....we'll see how it reacts tomorrow.
I also took some stupid trades for losses. TVIX and CONN didn't work out too well. Sometimes, you just need to walk away from the computer to avoid over-trading. Overall, a down day for me...I need to pace myself and stick with the best setups. NLST and PEIX should have been all I needed today.
~JP
Saturday, January 21, 2012
Trade Review and New Opportunities - MSFT, X, HPQ, STAA, PEIX, NLST, VLNC
Hey All, Hope everyone had a good week. There were some good moves in a few tech names despite negative earnings by Google.
As I mentioned in prior blog posts MSFT has been looking really strong and has made an awesome move over the past couple weeks. It continued its upward push on Friday. I took an entry when MSFT hit its lower trend line ($24ish), but sold in the $26 range....wish I was still holding this one. Oh well, that's how it goes sometimes.
I mentioned a recent position in HPQ, which had a strong day on Friday too. I'm looking for some continuation in the price movement before it hits some resistance at around $28.5 to $30.
I sold my shares in US Steel, X, last week for about break even. Right after I entered the position, the stock sold off for about 4% I purchased some additional shares around the lower trendline. Luckily, the stock bounded strongly off this level and allowed me to exit without any losses. It still may move up, but the market is moving into a resistance zone and this stock tends to trade with the market. If the market drops, this could follow in a big way. I was a bit worried that it had been lagging the general market and was setting up for a move lower.
Here are some other stocks I will be watching this week.
STAA - I will be looking to buy around the lower trend-line pull back at around $10.69 (which is close to its 20 day ma). This will have a pretty tight stop at around $10.45/.50. First target is back at the recent highs of $11.70. If it breaks that level, it could see $12.50-$13 pretty quick.
VLNC - I purchased this on Friday at $1.05 as it broke out of its flag. I'm keeping a close eye on this one Monday. If it moves up with volume, it could see $1.20/.25 pretty quickly. I'll stop out at around $1.02.
NLST - I wanted to buy this at the lower trend-line around $2.75, but didn't watch it close enough. Its had a nice bounce of that level. A push over $3 could get this rolling. I might look for a lower open and move to a positive level for entry around $3. Stop would be around $2.95. Target $3.25/.45.
PEIX - Keeping an eye on this one. Its coiling up in to a wedge that is supported by its 50 and 20 day ma. If it breaks above the $1.20 level, it could get going and run for a while. First target is $1.50. Stop would be around the 50 day ma, $1.10.
These small stocks can be tough to trade, so I typically take 1/2 size positions on these.
~JP
As I mentioned in prior blog posts MSFT has been looking really strong and has made an awesome move over the past couple weeks. It continued its upward push on Friday. I took an entry when MSFT hit its lower trend line ($24ish), but sold in the $26 range....wish I was still holding this one. Oh well, that's how it goes sometimes.
I mentioned a recent position in HPQ, which had a strong day on Friday too. I'm looking for some continuation in the price movement before it hits some resistance at around $28.5 to $30.
I sold my shares in US Steel, X, last week for about break even. Right after I entered the position, the stock sold off for about 4% I purchased some additional shares around the lower trendline. Luckily, the stock bounded strongly off this level and allowed me to exit without any losses. It still may move up, but the market is moving into a resistance zone and this stock tends to trade with the market. If the market drops, this could follow in a big way. I was a bit worried that it had been lagging the general market and was setting up for a move lower.
Here are some other stocks I will be watching this week.
STAA - I will be looking to buy around the lower trend-line pull back at around $10.69 (which is close to its 20 day ma). This will have a pretty tight stop at around $10.45/.50. First target is back at the recent highs of $11.70. If it breaks that level, it could see $12.50-$13 pretty quick.
NLST - I wanted to buy this at the lower trend-line around $2.75, but didn't watch it close enough. Its had a nice bounce of that level. A push over $3 could get this rolling. I might look for a lower open and move to a positive level for entry around $3. Stop would be around $2.95. Target $3.25/.45.
~JP
Monday, January 16, 2012
Dealing with Losses in Trading
A big part of trading stocks, weather long or short-term perspectives, is dealing with and accepting losing your hard earned money. Since my perspective has been more short-term biased over the past couple years, I've learned that accepting losses is just a part of the game in order to move my account forward.
The key, which is displayed in the table below, is that you limit your losses relative to the gains that you make. Sounds pretty obvious, right? Well, it made a lot more sense to me when I put this table together and played with the numbers to see how the results turned out. The table below show a 50% win/loss ratio, the same average trade size, but the average gains are better than the losses incurred. As a result, the net gains are positive. You can transfer this data to a spreadsheet and play with the numbers to evaluate different scenarios. Maybe your average gains are smaller for your winning trades, but you have a higher win/loss percentage. That also works, if you can stay nimble in taking quicker profits.
Commissions also become a factor if your average trade size drops. You can have positive gains with your trades but as your average trade size drops, commissions stay static and eat into your profits quicker.
Don't get me wrong, win/loss percentage is important, but you are not going to win 100% of the time. However, you can be successful if you only win 50% of the time, even less. Limiting your losses is huge. As your average loss increase, it becomes more difficult stay positive with your overall trading profits. In my own trading, I've gotten into the habit of being more mechanical in sticking with my stop losses between to 2-2.5% of the trade. Also, if the trade is not working in my favor quickly, I'm more apt to accept a break-even trade or less than 1% loss. Instead of looking at a losing trade as a loss, I view it as protecting my capital. There will always be another opportunity in the market. Don't put your money at risk on hope. Protecting your investment capital is key to longevity and success.
~JP
The key, which is displayed in the table below, is that you limit your losses relative to the gains that you make. Sounds pretty obvious, right? Well, it made a lot more sense to me when I put this table together and played with the numbers to see how the results turned out. The table below show a 50% win/loss ratio, the same average trade size, but the average gains are better than the losses incurred. As a result, the net gains are positive. You can transfer this data to a spreadsheet and play with the numbers to evaluate different scenarios. Maybe your average gains are smaller for your winning trades, but you have a higher win/loss percentage. That also works, if you can stay nimble in taking quicker profits.
Commissions also become a factor if your average trade size drops. You can have positive gains with your trades but as your average trade size drops, commissions stay static and eat into your profits quicker.
Don't get me wrong, win/loss percentage is important, but you are not going to win 100% of the time. However, you can be successful if you only win 50% of the time, even less. Limiting your losses is huge. As your average loss increase, it becomes more difficult stay positive with your overall trading profits. In my own trading, I've gotten into the habit of being more mechanical in sticking with my stop losses between to 2-2.5% of the trade. Also, if the trade is not working in my favor quickly, I'm more apt to accept a break-even trade or less than 1% loss. Instead of looking at a losing trade as a loss, I view it as protecting my capital. There will always be another opportunity in the market. Don't put your money at risk on hope. Protecting your investment capital is key to longevity and success.
~JP
| TRADES | AVG TRADE SIZE | AVG GAIN LOSS % | GAIN LOSS $ | COMMISSIONS | NET GAIN LOSS | |
| WINNING | 50 | $ 2,000 | 5.0% | $ 5,000 | $ 700 | $ 4,300 |
| LOSING | 50 | $ 2,000 | 2.0% | $ 2,000 | $ 700 | $ 2,700 |
| $ 3,000 | $ 1,400 | $ 1,600 |
Thursday, January 12, 2012
Trade Updates - X, NLST, HPQ, PEIX
Howdy Folks! The markets have been progressively moving higher and a lot of smaller stocks have been bouncing big for 20, 30, 40% gains per day over the last two weeks. Here is an update on some newer positions I've taken.
I mentioned $NLST a week ago or so ago with a buy price of $2.44. I sold a few days later at $3.05 (25% gain) as the stock met my target of $3. The stock has pulled back a bit since and can make another run. But, I think volume needs to pick up.
I took a recent new position in Hewlett-Packard, $HPQ at $26.64. The stock is currently flagging around its 50 day ma after it bounced off of the lower up-trend line. My short-term target is $28.50, then $30. My stop is around $25.50 or so. The stock had been beat up pretty good over the last year from the $40-$50 range and could get a bounce for value investors. The key is to hold the 50 day ma.
I also took a new partial position in US Steel, $X at $28.74 today. I really like the base that is being created here. There is some lateral and down-trend line resistance that looks like might be broken soon. I mentioned this stock about a week ago and never got in cause of the big gap up on the day. I missed buying on the pull back over the last few days. It looks like its filled the gap and wants to head higher. I'm looking for a $30-32 target. My stop will be pretty loose here and I may add if the stock pulls back to the lower trend line around $25.25. If it doesn't hold that lower trend line, then I will exit the position.
Another new position I took today is Pacific Ethanol, $PEIX at $1.13. There is a long-term down-trend line that is being tested @ $1.20. If it breaks that, the 200 day ma is the next test @ $1.36. My stop is pretty tight here at around $1.10.
Feel free to comment. Have a good weekend.
~JP
I mentioned $NLST a week ago or so ago with a buy price of $2.44. I sold a few days later at $3.05 (25% gain) as the stock met my target of $3. The stock has pulled back a bit since and can make another run. But, I think volume needs to pick up.
Another new position I took today is Pacific Ethanol, $PEIX at $1.13. There is a long-term down-trend line that is being tested @ $1.20. If it breaks that, the 200 day ma is the next test @ $1.36. My stop is pretty tight here at around $1.10.
~JP
Sunday, January 8, 2012
Semi-Annual 401k Adjustments
Twice a year (January/Febuary and August/September), I make a practice of evaluating adjustments that I should make to my 401k. After all, my 401k has a decent amount of money in it and I want to retire someday...so, I think its important to manage the fund allocations according to my perception of market risk over the next few months. I also noticed that the older I get, the more conservative my fund elections get. So, I'll continue that trend over the years.
I plan on making some serious changes in the next month by getting a lot more conservative in my risk exposure. Why, you might ask?
First, I'm looking at where the Dow and S&P500 are currently at and what their trends are (200ma). In my opinion, we are at a high point while the indices are still in a bear market. The potential upside is not as significant as the potential downside.
Second, I look at events that could lead to further downside. European debt is my biggest fear at the moment. There are a number of countries in trouble and, eventually, simple math will force some tough decisions that will lead to a temporary ripple that the markets won't like.
Third, many domestic issues have not gone away. US Debt continues to rise, unemployment has not moved significantly down, oil prices are stuck around $100 per barrel (Iran could make it worse), housing is not bouncing, and we have politics. There is a fair possibility that the US can fall back into recession early this year.
So, my new changes are factoring in a lot of these ideas. If I'm wrong, I will have little growth in my account. If I'm right, I stand to SAVE a lot. Note that by limiting my risk, I'm expecting little to no growth in my account for the next 6-9 months, until I reassess in Sept/Oct.
Anything can happen though. The S&P could move up to 1500 in the next few months. Maybe the Fed issues QE3 to push off the problems for another couple years.
I want to emphasize that I don't like to try and "time" the market, but the last market crash opened my eyes a bit to the hit that my 401k took at the time. If I could have protected 10-20% of the value of my account back then, I would have saved a lot of money. So, this is the first time I'm making significant changes to my account, like the ones I'm proposing.
That said, here's what I'm gonna do...
My last changes were in Q2 2011 and Mid-2010. I plan on making my new allocations sometime in Q1 2012....probably late January or early February. I'll see how the market plays out over the next couple weeks before I make my moves.
Feel free to leave a comment.
~JP
***Please see my update to this post***
I plan on making some serious changes in the next month by getting a lot more conservative in my risk exposure. Why, you might ask?
First, I'm looking at where the Dow and S&P500 are currently at and what their trends are (200ma). In my opinion, we are at a high point while the indices are still in a bear market. The potential upside is not as significant as the potential downside.
Second, I look at events that could lead to further downside. European debt is my biggest fear at the moment. There are a number of countries in trouble and, eventually, simple math will force some tough decisions that will lead to a temporary ripple that the markets won't like.
Third, many domestic issues have not gone away. US Debt continues to rise, unemployment has not moved significantly down, oil prices are stuck around $100 per barrel (Iran could make it worse), housing is not bouncing, and we have politics. There is a fair possibility that the US can fall back into recession early this year.
So, my new changes are factoring in a lot of these ideas. If I'm wrong, I will have little growth in my account. If I'm right, I stand to SAVE a lot. Note that by limiting my risk, I'm expecting little to no growth in my account for the next 6-9 months, until I reassess in Sept/Oct.
Anything can happen though. The S&P could move up to 1500 in the next few months. Maybe the Fed issues QE3 to push off the problems for another couple years.
I want to emphasize that I don't like to try and "time" the market, but the last market crash opened my eyes a bit to the hit that my 401k took at the time. If I could have protected 10-20% of the value of my account back then, I would have saved a lot of money. So, this is the first time I'm making significant changes to my account, like the ones I'm proposing.
That said, here's what I'm gonna do...
My last changes were in Q2 2011 and Mid-2010. I plan on making my new allocations sometime in Q1 2012....probably late January or early February. I'll see how the market plays out over the next couple weeks before I make my moves.
| Year End 2010 | Q2 2011 Allocations | Q1 2012 Allocations | |
| Guaranteed Income Fund | 14.99% | 35% | 20% |
| Bond Fund | 2.13% | 0% | 40% |
| Equity & Income Fund | 23.66% | 20% | 20% |
| S&P 500 Index Fund | 2.89% | 0% | 0% |
| Large Cap Growth Fund | 10.68% | 10% | 5% |
| Large Cap Value Fund | 8.41% | 5% | 3% |
| Mid Cap Value Fund | 10.16% | 8% | 2% |
| Mid Cap Growth Fund | 5.23% | 5% | 4% |
| Small Cap Value Fund | 9.34% | 8% | 2% |
| Small Cap Growth Fund | 5.35% | 5% | 4% |
| Global Strategy Fund | 4.93% | 2% | 0% |
| International Fund | 2.24% | 2% | 0% |
| 100.00% | 100% | 100% |
Feel free to leave a comment.
~JP
***Please see my update to this post***
Wednesday, January 4, 2012
Trade Updates - MSFT, X, NLST
My prior blog posts highlighted Microsoft, MSFT, which recently broke out of a long-them wedge pattern to the upside and leads me to believe that it could reach the $30 mark in the next month or so. Unfortunately, I sold my shares around $26 for a small profit. If the shares pull back to retest the breakout, I may consider buying with a longer term perspective.
Monday's blog highlighted US Steel, X, which had a strong gap up on Tuesday Since I don't like to chase stocks after big gaps, I didn't get in for this move. The stock looks like it might hit the $30 target.
On Monday, I also mentioned NetList, NLST as a potential dip-buy. The stock moved 13% higher today. We'll see if it can get to my first target at $3 in the next few days.
Feel free to comment. I love to hear feedback!
~JP
On Monday, I also mentioned NetList, NLST as a potential dip-buy. The stock moved 13% higher today. We'll see if it can get to my first target at $3 in the next few days.
~JP
Monday, January 2, 2012
Swing Trade Ideas: X and NLST
Hello, Hope everyone had a happy New Year! I'm sure that 2012 will present many opportunities for making profits. As long as the market shows strength this week, I'll be looking to swing trade a couple of stocks. I'm also evaluating my next moves to my 401k. I will write about that in a separate blog post.
First $X, US Steel, looks like it is bouncing off its lower trend line dating back to October. The top of the channel looks to be around $32, which is also price resistance and heading toward the 200ma. So, an entry from around 26.8 would produce around 18%. The stock is currently holding over the 20 and 50ma, which can represent stop points, and is pushing through its long-term down trend channel top. Entry around $26.8. First target around $30, then $32. Kinda loose stop around $25.
Second, $NLST is a stock I bought into with a small position on Friday. The stock had a huge run up in November, pulled back in a bullish descending wedge. On Friday, it bounced off its 50ma and lower upward trend line (from October) with some decent volume. The MACD and Stochastics look like they are setting up for an upward move. Based on previous price action in November, this stock can move. My entry was 2.44, My first target is around $3, then 3.30, then 4.00. Stop at the 50ma.
~JP
First $X, US Steel, looks like it is bouncing off its lower trend line dating back to October. The top of the channel looks to be around $32, which is also price resistance and heading toward the 200ma. So, an entry from around 26.8 would produce around 18%. The stock is currently holding over the 20 and 50ma, which can represent stop points, and is pushing through its long-term down trend channel top. Entry around $26.8. First target around $30, then $32. Kinda loose stop around $25.
Second, $NLST is a stock I bought into with a small position on Friday. The stock had a huge run up in November, pulled back in a bullish descending wedge. On Friday, it bounced off its 50ma and lower upward trend line (from October) with some decent volume. The MACD and Stochastics look like they are setting up for an upward move. Based on previous price action in November, this stock can move. My entry was 2.44, My first target is around $3, then 3.30, then 4.00. Stop at the 50ma.
~JP
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