# CFD Diary



## Lachlan6 (8 May 2007)

Gday all. Its been a while since I have posted on this forum. Well going to make a new thread similar to a trading diary and would appreciate feedback etc. 

Looking at opening up new trade Long (DOW) today. Waiting to enter at $7.68. It has formed a breakout pennant like formation. My target is $8.00, stop loss, $7.44. Closed out of (PBL) today for 5.8% profit. Also closed out of (CSM) for 2.4% profit and (AWC) for 3.8% profit. I am currently Long (NAB) getting in yesterday at $44.34, Long also (WPL) getting in at $40.34 (current stop, $42.24) and short (ALL) after getting in at $15.15 a few days ago. Also looking at short position in (TTS), probably get in at $4.93 if it gets down there today. (TOL) is another prospective Long. My trigger is $22.85, stop at $22.12.

The market may be finding its feet at the moment, crucial support at 6294 on the AUSSIE200 needs to hold. If so the market will not fall further today. Let's see.


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## CanOz (8 May 2007)

Lachlan6 said:


> Long also (WPL) getting in at $40.34 (current stop, $42.24) .


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## Lachlan6 (8 May 2007)

Sorry that should have read got in at $40.34, stop at $42.24.


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## CanOz (8 May 2007)

Lachlan6 said:


> Sorry that should have read got in at $40.34, stop at $42.24.




Sorry Lach, but do you mean 42.24 is your target price....or you've gone short and its your stop loss?

Cheers,


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## Lachlan6 (8 May 2007)

No $42.24 is my trailed stop. Cheers mate.


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## R0n1n (8 May 2007)

Lachlan6 said:


> No $42.24 is my trailed stop. Cheers mate.




Lachlan, how do you shortlist stock ? I am new to CFDs and creating a shortlist and further handpicking is quite difficult and timeconsuming for me.. Hope you can shed some light on it.


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## Lachlan6 (8 May 2007)

G'day ROn. Well what I do is limit my short list to the top 100, as this will give you the greatest opportunities, i.e less outlay (typically 3-5% margin rate). I check pretty much every stock then look for trading opportunities during the day such as a break of overhead resistance (opposite if going short), a bounce off a trendline or an ominous candlestick pattern emerging such as a bullish/bearish engulfing pattern, or doji reversal candle.

For example, I have short listed a few candidates for tommorow's trading. On the long side, I have (CTX) which is currently in a large triangle like formation. I would look to go long on a break to the upside of that pattern, probably around $24.65-70. (CGF), may be about to break either way as in holding pattern at the moment, maybe double top? Probably sell below 15 day MA. Similar situation for (CPU) although may be triple top, may be just consolidating for move higher, i'll watch tommorow. (OSH) similar pattern to (CTX), I'll watch tommorow. (LEI) I will look for a break to new all time highs to trade long, as well as (CSL).

Short candidates, include (TTS), I will look to go short around $4.93. (TEL), short around $4.25-6. Bias is definently short the market at the moment, (how long can we go up like this?), so will scan for short opportunities in line with market performance. Hopefully that helped you out a bit .


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## R0n1n (8 May 2007)

Lachlan6 said:


> . Hopefully that helped you out a bit .




helped me out immensely. 

I am also trying to work out my entry and exit strategy. I use an EMA 20 and SMA 20 with RSI14 and CCI14 to give me an entry. Do you thing its allright ? 

I am also experiminting with SMA 20 and EMA9 with SMA50 as support line. Do you think its allright ?

Your help and anybodys suggestion to tweak my strategy would help us noobs a lot.


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## Lachlan6 (8 May 2007)

Whatever works for you is fine. Remember trading is not an exact science, so I tend to predominately look at raw price data within the chart itself. I favour the 15 day EMA for picking short term trends and generally place stops below/above this line. RSI can be very effective for picking up on divergences and is one of my favourite indicators, for picking up on possible imminent weakness/strength of a stock. In terms of intra-day trading the stock off the daily entry, I use 5 minute candlestick charts and ONLY trade in those that are strongly trending during the day and fine tune my entry/exit strategies. In many ways this is crucial, as when I first started trading, I used to get occasionally stopped out of trades intra-day.

I STRONGLY recommend a book called 'Trade your way to financial freedom' by Van Tharpe, it is a bit of a bible for those wanting to trade derivatives. The most important thing is the entry is only a very small part of the overall trade, the most important thing is how you manage the trade. 

An example of the above, is I entered two long trades during the day. One in (TOL) at $22.85, it trended strongly up intra-day all day and also (DOW) at $7.68, same story.


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## R0n1n (9 May 2007)

thankyou very much for helping me out and clarifying a lot of stuff..

Continue with your Diary... it will be an interesting read.


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## Lachlan6 (9 May 2007)

Gday all. Pretty directionless day so far. Looking at a few potential trades. The best of which I think is a long position in (BXB). My trigger is $13.30, so should hit that today. Missed out on (CTX), probably a little conservative with my entry. Not to worry, NEVER chase a trade. Was a little nervous about (DOW) earlier in the day. Seems to be consolidating now, have to watch carefully, my stop is at $7.44. I have also trailed my stops on the (ALL) short trade and (TOL) long trade.


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## R0n1n (9 May 2007)

Lachlan6 said:


> NEVER chase a trade.




This is absolutely true.. cos at the most u get is the tail...if at all. Missed money is better than lost money...


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## Lachlan6 (9 May 2007)

Well what an amazing day on the markets. It seemed a little lacklustre until the (XMJ) bolted away with both (RIO) and (BHP) having HUGE rises, especially the former. Anyway, went long (BXB) as alluded to earlier in the day, at $13.30. Looks like forming nice little double bottom, and bounce off trendline support. Got out of (ALL) today at $15.3 for small loss (short trade), and entered long trade in (WOW) at $28.05. (WOW) has been punished a little lately and today's action alludes to possibly higher prices in the near future. Stop loss is $27.5. 

Went short (TEL). Feel like with the market looking like may reverse relatively soon, that a short trade will be wise. Entered at $4.23. It has broken the short term uptrend, my stop is $4.33. Raised the stop on (TOL) to $22.54 and (WPL) to $42.88. I expect to be out of the latter soon. Looking carefully tommorow at (MIG) to go long and a possible long in (TTS) and (SGP).


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## moxy (9 May 2007)

Lachlan

Just wondering on average how long do you stay in your trades. And what percentage risk do you use and position size? Thanks for posting...plenty of us cfd traders out there and great to be learning from each other!.

moxy


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## Lachlan6 (10 May 2007)

Hello Moxy. The position sizing is CRUCIAL for controlling risk and I cannot emphasise that enough. You may get tempted during the day when you see a trade that might look too good to be true. In my opinion it doesnt matter, never change your percentage risk per trade. I currently risk 3% per trade of my entire portfolio, so that if a trade goes bad I tend to only lose a small amount. I have had trades (RMD the other week) dramatically gap against me, but there is nothing you can do really about that, short of having a guarenteed loss something I dont do.

I tend to stay in trades from two days up to 10-12 days. It really depends on how far the trend goes. Hope that helped you out a bit.


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## Lachlan6 (10 May 2007)

Gday all. Today was a busy day trading. I started off by selling my (WPL) longs at $43.02 for a 6.6% gain. This stock has had a dream run and i decided to lock in profits. Also sold (DOW) at my initial stop $7.44 for a loss. I dont like exiting at my initial stop, prefer exiting at a trailed stop for a smaller loss, but if the stock does nothing, you cannot trail the stop. 

I entered (SGP) at $8.87, but it trended lower all day, I have set my stop at $8.63, so will have to watch that carefully tommorow. Entered long position in (LEI). Got in at $37.51, after it hit new highs today with one of my favourite patterns, the ascending triangle. A little nervous about (TEL), but didnt hit my stop so sticking with trade. Meanwhile it was a good day for (TOL), (WOW) and (BXB), so I have trailed my stops on all three to be in a money making position now. 

I exited (NAB) below my trailed stop at $43.43. One thing which I forgot about was it reporting earnings today. My promise to myself is never hold a stock when they are reporting earnings, have AGM or other important potentially moving stock price information coming out. Ah well, I will be more attentive in the future. 

Tommorow, watching (TTS), (CCL), (JHX) and (TCL). Cheers.


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## Lachlan6 (11 May 2007)

As expected our market is responding to the big fall overnight in the US. I just went short (CSM) at $3.65, broken short term support and trending down today.  One trade I am looking at carefully, is a long in (TAH), it looks like it may be forming a bullish engulfing reversal pattern today which corresponds to strong support from the early March highs. Watching carefully today. Will probably get in around $17.82. Having trailed any stops today yet, but (LEI) may be trailed from yesterdays purchase later.


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## Lachlan6 (11 May 2007)

Another week over. As I alluded to earlier in the day was watching (TAH) closely waiting for an entry. Got a little excited so I jumped in prematurely at $17.82, the exact high of the session. I had the memory of missing (CTX) the other day in my mind and didnt want it to happen again. Closed at $17.65, so still a valid trade. I also went long (FGL) at $6.58. It seems to be bouncing off short term trendline support and is actually approaching completing a nice little double bottom pattern (I love these). Closed the week at $6.62, will watch with interest next week. 

Closed out of my (TOL) trade today for a slight profit (1.5%), and trailed my stop higher on the (LEI) trade. Still in (SGP), but may be out Monday. Closed at $8.68, still above the 15 day EMA though. Enjoy the weekend!


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## Lachlan6 (11 May 2007)

Sorry a small correction, the earlier message in the day should have read short (CSR) at $3.65.


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## R0n1n (11 May 2007)

Lachlan6 said:


> Sorry a small correction, the earlier message in the day should have read short (CSR) at $3.65.




Lachlan, FGL is just about to cross its SMA40 line, do u jump in early or do u use another indicator as well.. just trying to learn off your experience... hope its allright...


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## Lachlan6 (11 May 2007)

Gday RoN. Personally I dont use the 40 day SMA, but this does not mean that it is not a valid indicator. I tend to look at the lesser 15 day EMA for picking short term trends in a stock. Ie, if its trending up, the short term trend of the stock is generally up and vice versa. I find this EMA an excellent indicator to place stop losses, below or above. Personally I think the perfect time to have entered (FGL) was yesterday when it bounced off its short term trendline. Today was fine though because the stock trended up strongly all day, a clear intra day buy signal. It may have some resistance at around $6.70 being close to the 50% fibonacci level from the February downward movement. 

I have set my stop at $6.40 below the uptrend line. Also there is a bit of positive divergence in the RSI with the corresponding April and May lows another positive signal. Remember RoN, dont worry about overanalysing stocks, because the entry is only a small part of the trade. It is how you manage it that will make you money. So use whatever indicators you feel works and mix and match and go with the stocks that feel right from the charts. Cheers, Lachie


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## R0n1n (12 May 2007)

I see your point. 
I did my third CFD trade on friday. Jumped into (QBE). I am still trying to get it right, maybee getting too cautious. I did pick QBE the way u recomended.. by quick eyeballing asx100.


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## moxy (14 May 2007)

thanks lachlan

You must be doing nicely out of the lei trade!


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## Lachlan6 (15 May 2007)

Gday Moxy. Yes the (LEI) trade went well but just remember there are losing trades as well, all part of the fun. Just a quick note, because out of Melbourne till Wednesday. Only in 4 positions now. Long (BXB), (WOW) and short (TEL), (CSR). Not going to enter anything new till WED/THU. Cheers.


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## vert (15 May 2007)

hi lachlan6, was wondering do you use a pecentage or a set difference from the 15 ema above or below for your stop losses? which way for long or short? and does this differ for different price ranges. eg $0-$0.10, $0.10-$1.00 etc. thanks your imput is valued.


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## Uncle Festivus (15 May 2007)

Howdy CFDer's,
Anybody interested in online chatting about CFD trades during trading hours?
There seems to be a growing interest here for CFD's and methods of trading them. If anybody is interested, I'm looking at using Yahoo Messenger, or if anybody has a better suggestion then let me know.
UF


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## professor_frink (15 May 2007)

Uncle Festivus said:


> Howdy CFDer's,
> Anybody interested in online chatting about CFD trades during trading hours?
> There seems to be a growing interest here for CFD's and methods of trading them. If anybody is interested, I'm looking at using Yahoo Messenger, or if anybody has a better suggestion then let me know.
> UF




Here's a suggestion UF- ASF has a chat facility set up for just these types of things


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## Uncle Festivus (15 May 2007)

professor_frink said:


> Here's a suggestion UF- ASF has a chat facility set up for just these types of things




Yep tried it - pretty buggy software, sometimes works. Looking for a more advanced chat/conference app with ability to post charts & comment in real time while day trading sort of thing.


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## Lachlan6 (18 May 2007)

Gday all. Looking at few positions today. Possible short (SIP), (JHX), (TTS) and long in (CCL), (UGL). Still have short position in (TEL).


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## AJ_ (18 May 2007)

hi,

uncle festivus and i are using yahoo instant messanger to chat during trading.. its pretty good. PM us if you want to join in.


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## Lachlan6 (18 May 2007)

Gday AJ. How does the messenger work. I am currently on MSN Messenger can u use it interchangeably?


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## R0n1n (18 May 2007)

Lachlan6 said:


> Gday AJ. How does the messenger work. I am currently on MSN Messenger can u use it interchangeably?




yes you can.. your hotmail email id will be able to chat up with Yahoo messenger, may not be able to use all the features but regular text chat will work fine.


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## Lachlan6 (18 May 2007)

I took a few trades today on the back of a weaker market. Went long (CCL) at $9.81, only a cent off the high, hopefully it doesnt turn out like the (SGP) trade which I entered prematurely. Also went short (TTS), it has broken short term support and may start trending down. Went also short (WAN) after a little bit of hesitation (In such a strong overall market too many short positions can be difficult to trade), at $15.77. It closed the day in the money slightly.

Exited my short (TEL) trade at $4.29 for a small loss. The market may just be pausing for a fresh run higher, next week will help clarify this a little, or it may be toppy. Anyway not here to predict, just to trade the trends.


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## Lachlan6 (18 May 2007)

Gday Vert. Yes I do trail my stop differently for different priced stocks. Smaller priced range stocks require a little more to move around so that you dont exit early etc. For example a stock worth $19 will have a railed stop different to one worth $3. Anyway its best to just work out a good trailing stop loss strategy and work around these differences.


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## flinders (18 May 2007)

happy to join in this chat.
I use CMC atm.have entered BLD @ 904 with sl @ 896.also running with MAP this am in at 409  sl  @  399.
know lot of flack re MM.as compared to DMA. but also run with sanford to check prices etc. have not had major prob with CMC re market price etc so far.started with them when "deal for free"


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## Lachlan6 (21 May 2007)

Still short (WAN) and (TTS). Watching both carefully but still valid trades. Market just consolidating atm in very tight range. Just entered (LLC) long, monitoring (UGL), (SGB) and (SUN).


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## Lachlan6 (21 May 2007)

Just took the one trade today, going long (LLC) at $19.89. It had a big bounce off resiistance turned support from the February highs, and seems poised to travel higher. Still short (WAN) and (TTS). Liked the late inaction in (WAN) today despite a very strong market, signalling possibly further weakness. (TTS) on the other hand will be watched carefully tommorow as my initial stop is $5.03. 

Was close to going long (SGB) today but needed to break $37.50 convincingly for me to enter. Was also considering (ABS) but the lack of buyer depth at the time turned me off. Market still within a short term consolidation range, a breakout either way will either signal a resumption upwards or a fall back.


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## Lachlan6 (22 May 2007)

Down day today was good for my shorts. (TTS) and (WAN) came back with the market. I have trailed my stop on (WAN) now to $15.69. No new trades today, was out for most of day. Contemplated going long (QAN) with a tight stop and even (AMC) long, but decided against it. 

(LLC) came back also but because of my good entry yesterday, still a very valid trade. It closed around the halfway point of yesterdays bullish candle, so still positive. Have to watch (CCL) closely tommorow as may hit initial stop of $9.50.


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## born2win (23 May 2007)

Hey, i'm still currently learning my CFD trades, just wondering when i start, could i join you guys. I'm still a newbie in learning =)

Thanks


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## dlineinvestor (23 May 2007)

Welcome born2win

How are your CFD trades going.
What are your entry parameters and which stocks are you looking at.

Moving averages 4 and 8 will get you in and out of short term trades accompanied with volume. You are aware of trading trends I hope, even seasoned CFD traders sometimes break the rukes on that one. 

Best Trading
dline


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## R0n1n (23 May 2007)

dlineinvestor said:


> Welcome born2win
> 
> 
> 
> Moving averages 4 and 8 will get you in and out of short term trades accompanied with volume.




Can you elebrate on that a bit more... thanx.


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## Lachlan6 (23 May 2007)

Gday all. Welcome born2win to the CFD racket. Another interesting day on the markets. Early rally stifled by late selling (is it sign of fund managers unloading into strength?). Took three new trades today. Went long (PBL) early at $21.20. It has corrected a bit since the early May highs and todays bounce corresponded almost to previous resistance turned support. Also went long (ANN) at $12.20. Spotted a short late in the day in (BSL). It closed for the first time since March underneath the 15 day EMA and it looks due for a bit of a correction after falling through short term support. Got in at $11.56. 

I exited (CCL) today on my initial stop. Was never a good trade and was just holding on. However both (LLC) and (WAN) had very good days. So trailed stops on both of these. All bodes well for a busy day tommorow.


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## Lachlan6 (24 May 2007)

Gday all. Just did the one trade today. Exited (LLC) for 1.1% profit. Very weak day today so shorts are looking good. Trailed the stops on (PBL) and moved the stops on (WAN) and (BSL). (TTS) still at initial stop but if it trades below $4.86, will trail stop lower.


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## Lachlan6 (28 May 2007)

OK then. Started the day by buying back (BSL) shorts for 2.4% profit. Entered into three new trades today, however my entry levels were not so great. Went short (MGR) at $5.13, posted chart earlier regarding this chart. Also went short (WDC) at $20.25, after it broke through 200 day EMA only to close the day relatively strongly at $20.37. 

Went long (TAH) right at the end of the day at $17.65. It is currently in a rising channel and the last couple of days is bouncing off the lower trendline of this channel. A possible target around $19. Moved stop in (TTS) short trade to nice little earner. Currently short TTS, WDC, and MGR, and long PBL, ANN, and TAH. Still think the market is looking short term sick, so happy with my shorts.


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## ozymick (29 May 2007)

*Re: CFD Diary - yahoo chat*

Hi 

I downloaded Yahoo Chat

Username  tmmick642000  -- add me

Looking forward to chatting sometime soon

Michael


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## Lachlan6 (29 May 2007)

Busy day today. My shorts were all stopped out due to the strong market. Got out of (TTS) at $4.78 for a 2.2% gain. However my (WDC) and (MGR) trades hit my initial stops which made a bit of a dent to my overall P/L. Ah well, also exited (ANN) for small loss.

Went long three new stocks today namely (MBL) (a great bullish engulfing reversal candlestick pattern, by far my favourite to see). Furthermore, today's action coincides pretty closely to the 50% fib retracement from March to May highs. Looks like about to enter Wave 5. Also went long (OXR) which may have already entered Wave 5, it had a nice bounce off short term uptrend support and looks set for higher levels. Finally went long (BHP) after it broke through short term resistance today. Lets hope its up in the States!


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## moxy (30 May 2007)

lachlan

Is it too rude to ask your actual figure of profit and loss thus far....your trading frequency is what I'm aiming for and am just curious how it is working for you. Also, do you use Profitsource?

regards
Moxy


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## >Apocalypto< (30 May 2007)

Lachlan6 said:


> Busy day today. My shorts were all stopped out due to the strong market. Got out of (TTS) at $4.78 for a 2.2% gain. However my (WDC) and (MGR) trades hit my initial stops which made a bit of a dent to my overall P/L. Ah well, also exited (ANN) for small loss.
> 
> Went long three new stocks today namely (MBL) (a great bullish engulfing reversal candlestick pattern, by far my favourite to see). Furthermore, today's action coincides pretty closely to the 50% fib retracement from March to May highs. Looks like about to enter Wave 5. Also went long (OXR) which may have already entered Wave 5, it had a nice bounce off short term uptrend support and looks set for higher levels. Finally went long (BHP) after it broke through short term resistance today. Lets hope its up in the States!




Lachlan6,

I read your post around this time last night and would have said somthing but thought not my place.

I thought you were a little two preemptive in your longs on BHP and experientially MBL, as I look to trade MBL with cfd's a fair bit.

I really felt for you today mate just hope you had tight stops.

Regards
Joseph


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## Lachlan6 (30 May 2007)

Yep Trade It. Got slammed today. The one thing I have probably learnt about yesterday's longs is that it completely contradicted my overall bearish belief of the market at present. I still think that both longs were still valid trades and I can't resist bullish engulfing patterns (MBL), but when your heart says the market is weak and you go long a whole heap of positions, it is slightly contradictory. Ah well, we all learn from trading and I learnt that the hard way today.

Was stopped out of (BHP), (MBL) and even (OXR) at my initial stops. Having this happen in one single day REALLY hurts your overall P/L and has wiped out all my profits made in the last month. The good thing though was todays rally in (TAH) so I trailed the stop now to a break even level. I suppose the other lesson is that this is a drawdown, and I have to stick to my trading plan (and not be so Bullish when your heart is telling you otherwise!!!!!). Cheers, Lachie.


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## Lachlan6 (30 May 2007)

Gday Moxy. Overall down a little because of today however have been in the black all month. I spose the other lesson to learn is, don't overtarde. Sometimes I cant help it, my finger can be trigger happy.


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## thevadd (31 May 2007)

Lachlan6 said:


> Gday Moxy. Overall down a little because of today however have been in the black all month. I spose the other lesson to learn is, don't overtarde. Sometimes I cant help it, my finger can be trigger happy.




Hi 
 When you put a stop loss, do you put guaranteed stop loss?


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## Lachlan6 (31 May 2007)

Gday The vadd. 99.9% of the time I don't put on a guarenteed stop loss. Answering this is multi faceted, however it stems from the costly nature of placing g/stops in the first place. I think if you placed one on every trade, it would actually cost you more in the long run rather than just copping the occasional big downward/upward gap against you. Furthermore, now I only trade in the direction of the trend, and generally, the gap will be in the direction of the trend. Very nice if you are on the right side of it.


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## Lachlan6 (4 June 2007)

Howdi all. Took three trades today in a market defying all my short term bearish beliefs. It may take a little longer for this to play out, but today was definently a significant one with a break to the upside of recent consolidation. 

Hence I went long three stocks. (GPT) at $5.26, (OXR) at $3.33 and (MAP) at $4.21. All are showing nice signs of rising, but I especially like (OXR) which has entered a Wave 5 and I have placed a wide stop with projected target at $3.74.


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## Lachlan6 (7 June 2007)

Howdi all. Sorry been a little distracted of late, studying frantically for uni exams. Have the three open positions at the moment. Long in (JHX), entry $9.56, long (OXR) entry $3.33 and long (SRL) at $4.17. Market looking jittery at the moment, with DOW falling out of short term uptrend channel from March and below 15 day EMA. Cannot ignore diverging RSI forever. Our market was very resiliant however today on back of weaker DOW. 

Interestingly, it seems our market is really only being supported by the (XMJ) and lesser extent (XEJ) at the moment, and the (XFJ) has gone sideways since mid-April. In fact interesting chart the old (XFJ), sitting at precarious levels at the moment. 7200 is crucial support, if this breaks, then it will certainly pull our market lower.


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## reece55 (7 June 2007)

Lachlan6 said:


> Gday The vadd. 99.9% of the time I don't put on a guarenteed stop loss. Answering this is multi faceted, however it stems from the costly nature of placing g/stops in the first place. I think if you placed one on every trade, it would actually cost you more in the long run rather than just copping the occasional big downward/upward gap against you. Furthermore, now I only trade in the direction of the trend, and generally, the gap will be in the direction of the trend. Very nice if you are on the right side of it.




Lachlan
I trade CFD myself and if holding an overnight position, I ALWAYS take out a guaranteed position. I don't know what % your gearing is as % of your trading capital, but trust me, if your stock gaps by more than 10% out of your favour, .3% extra commish on the entry will be the last thing you are thinking about mate.

Seriously, I suggest you have a really good think about not using the derivative protection.... Just my opinion however....

Cheers
Reece


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