Tuesday, January 09, 2007

Closed out my HANS trade

The same problem is occurring again - I sell too soon....

Read Full Post.....

1. Why did I take this trade?
Because every momo trader and their grandma's pet amoeba was watching a certain price level, and I wanted to front-run that action.

2. What was the initial stop?
I bought @33.55, initial stop was @ 33.24.

3. Why did you exit where you did?
Because the market was selling off.

4. Is there anything you would do differently?
Individual charts trump overall market conditions.
This is starting to get a little discouraging. I will really need to work on finding a way to learn how to ignore my own market biases, and listen to what the individual chart is saying.
First thing is to start using the intraday trendlines more often - it hasn't become a habit yet, and today that cost me some profits that I left on the table.


Simply Options Trader said...

Why did i take this trade: lol, but seriously what made you decide to enter this trade, 2 days ahead of the the big surge? Insider info (lol!), technicals??

Phileo said...

Hi SimplyOptions,

In their newsletter, the group at identified 36 as the level to watch for HANS. I knew then that everyone would be watching the 36 level, so I was frontrunning the pending breakout @36. The triple (intraday) bottom from last week (Jan 3-5/07) gave me a stop loss point to work with.

It was admittedly a guess, but a calculated and educated guess, as I reasoned that based on HANS prior history, there was a high probability that HANS would run-up to the 36 level (as opposed to languishing @34 for a few more weeks). Once it got to the 36 level, there would be enough momo traders to push it up for a true breakout.

In my mind it was a low risk, high probability setup.

Simply Options Trader said...

Great insight Phileo, thks. Are you using some sort of free trial service or subsribing to HCP? I've heard some positive feedback about them. How's your experience so far?

Phileo said...

Hi SimplyOptions,

I originally signed up for the 3-week free trial, but found it so useful that I am now a paying subscriber to the HCPG newsletter. It cost $30/month when I first joined, but I think it's a little bit more than that now.
However, that still works out to less than $2/trading session, and it's so easy to make up for that in just one trade.
I really enjoy their service. They provide a very good analysis of the markets and their selections, and occasionally throw in a very enjoyable lesson on how to read and spot specific chart patterns, much like what I've been doing with my pattern catalog.
Their picks are basically a breakout momentum type of trade. This is a specialized type of trading, and may not be for everyone. My HANS trade here does not fit into their style. Probably the best thing to do is try them out for 3weeks and then decide for yourself.