Tuesday, December 05, 2006

Deconstructing my GROW trade

Here is how my GROW trade turned out:

As pointed out by SimplyOptions, I bought GROW before the break of the OR high, which I admit was higher risk (because it could and often does, just reverse at the level of the OR high). The reason that I did that was because I noticed that the volume started to pick up, and the bid was starting to move up as well. Compare this with a lower risk entry (copied from the Dec 04/06 edition of the HighChartPattern newsletter, with their permission of course):
My purchase was one of those candlesticks before the break above the yellow line (@51.31). Yes, it would have been lower risk to wait for the break above 51.5, and yes, it would have been better to be just a little bit more patient, but I'm not going to beat myself up over that.
I will say, though that I clearly did not have an exit strategy with GROW, and I'd much rather beat myself up over this instead - LOL!
I sold today @57.53 but again, I had the bad habit of watching just the ticker instead of trading the chart. Had I been watching the chart instead , and pasting up a moving avg line (2 clicks of the mouse on the IB TWS), I could have easily and realistically extracted another $1.40 from this trade (the MA would indicate a sell just below $59). An extra $1.40 of profit was left on the table - that sucks !!

Trade the Chart and not the Ticker !!

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