ASX Momentum Trade Book - Part 2

[Wyatt]

Wyatt: Nicely done presenting the RCG chart for comment (post #480). That was a very timely post (before today's news) and I'm thankful for your contribution. (*)
I did consider including a trade in RCG for the thread, but declined as it was more of a reversal setup rather than a trend continuation.

(*) We need a "cheque's in the mail" smilie.

Gee thanks Peter2, pity I wasn't on it, although I was earlier in the year, but the capital raise put a spanner in the works, just as it did to EML and NTC which ended up being losers 4 me. The latter 2 may get a 2nd chance if they behave. EML is respecting support @ $1.20 and NTC is similar @ $2.20 ish

I note that in your system, stocks experiencing a C/R are shown the door immediately. I may have to follow you on that one, which is unfortunate as I was eyeing VOC until the recent C/R. Great chart tho.



Cheers,
Wyatt

 

[Nortorious]

Gee thanks Peter2, pity I wasn't on it, although I was earlier in the year, but the capital raise put a spanner in the works, just as it did to EML and NTC which ended up being losers 4 me. The latter 2 may get a 2nd chance if they behave. EML is respecting support @ $1.20 and NTC is similar @ $2.20 ish

I note that in your system, stocks experiencing a C/R are shown the door immediately. I may have to follow you on that one, which is unfortunate as I was eyeing VOC until the recent C/R. Great chart tho.

View attachment 67358

Cheers,
Wyatt

I was in NTC too but sold out just before the big run

Did the exit conform to my trading strategy?

Pretty big lesson on lost opportunity with my friend NTC

 

[peter2]

Trading update: New trade and we take profit on another.

S2R: Bought the break-out today (0.315), iSL is 0.26.

ADA: Sold today at its +2R target. Our other option is to let it go and employ a TS, but as the market conditions are volatile we'll grab the above average profit now. Personally I've sold 1/2 and will let the remainder run with a loose trailing stop. We can't sell 1/2 in this portfolio as the parcel sizes are too small and the extra brokerage will be an added drag.

 

[peter2]

One of the difficulties in trading. The hot sectors at the moment are the very dog sectors up until 4 weeks ago. It's often hard to adjust your mindset to buy with confidence when you are so used to seeing it dropping week after week. There has been quite a few false starts but they were just that... so one normally waits for confirmation which sometimes ruins the R:R. ...

Saw this while looking for a old post. It's so right. There are periods when we're in sync with the market and there are times when we're not. I agree with the idea that we get out of sync because of our recency bias. Another reminder for the chartists, to trade what we see, NOT what we think.

 

[peter2]

The old post I was looking for mentioned my problem (bias) that I can't buy stocks after a sustained price rise. Some of them continue higher and some of them don't. The chart I mentioned at that time was CIM and I couldn't buy the new break-outs even though they complied with this thread's TP because imo the reward:risk wasn't acceptable.

I love it when the market shows that we've made another good decision. A decision that was based on opinions about probability and whether the RR is acceptable at that time.

Every moment in the market is unique. Thank-you Mark Douglas (rip).

 

[peter2]

Trading update: New trade

AZY: Bought today's BO at 0.061, iSL 0.054

Yes, this was on my list as well and it might be a quick one.

 

[peter2]

Trading update: New trade (cfd)

CCP-cfd: Bought today's BO at 12.51, iSL 11.70.
Used a cfd to reduce cash required for trade.



I'm watching another one as well (MND).

 

[VSntchr]

Trading update: New trade (cfd)

CCP-cfd: Bought today's BO at 12.51, iSL 11.70.
Used a cfd to reduce cash required for trade.

Entered this one today also, but with a tighter stop, hoping for a quick spike.
MND I got brexited, considering second attempt...

 

[peter2]

EOW 71 update: ASX Momentum Portfolio +25.3% ( 79% invested in 6 stocks ) SPAX2F15 index -4.5% (past 71wk)

Our portfolio fared well this week as demand for some of our stocks continued.

This weeks sells: ADA sold at T2 target. result +2R or +$1255. An above average result that helps raise our ave win.
The limit sell order has been in the market for a while anticipating a spike and as the price rise was steady I considered replacing at the next level T3 (3.34). I decided to leave it at T2 because the market is still quite volatile and the daily up trend is weak (hasn't made a new high).

This weeks buys: S2R, AZY, CCP (Note: we didn't need to use a cfd for this trade as there was plenty of cash. )

AZY: We got a bit lucky with this purchase at 0.061 this afternoon as price spiked to 0.065 soon after our buy. It returned to 0.062 as someone was playing with their sell order. Basically the supply of stock was pulled higher after the BO. It will be interesting to see what happens on Mon. morning. Our TS has been raised already as today's BO was quite strong. I would be concerned by a close below 0.06 and that's why our TS has been raised.

Outlook: Anything can happen. If there is a pull-back in gold next week, we'll be looking for a PB setup in a gold producer to join the trend which has been quite strong.

 

[VSntchr]

IPD chart looking pretty good for a BO trade. A couple of HL and a break above recent resistance..


With a 4C out at the end of the month, there is no messing around with this trade and it either goes up now, or it doesn't stay in my trade book. I took the close at $1.05 and have a tight stop at $0.985. There are some clear levels for other longer term traders who might want to give it more room.

 

[VSntchr]

Didn't get a chance to post in market hours and it has already popped so could be seen as hindsight trading - in any case I'll post the chart up of WBA.
One of craft's favourites in the agri space. Cotton futures tearing up recently have helped to turn the chart. Potentially a good candidate for the tax-loss list too...


Entry at 1.22 with a stop at 1.09. Lots of overhead resistance so may not suite everyone.

 

[peter2]

Trading update: New trade.

A2M: Bought the BO-HR today at 1.82, iSL is 1.71.



IPD, WBA: Nicely done Vsntchr. Both spiked higher quickly (jumped the creek). I'm seeing a lot of that lately due to the thin depth.

APX: Limit sell order in at 3.15 (+3R)

 

[peter2]

We're running out of cash (only 1K left, can't do much with that) and with plenty of opportunities we are going to use cfds which don't require as much cash up front.

To free up some cash the first thing we do is get rid of any losers. This portfolio doesn't hang on to any losers, but I know you do. Get rid of them and use the money to buy stocks going up. We're going to raise a few TS's which reduces our portfolio heat and if any prices start going down we'll sell to realise some cash for other opportunities.

APX: A small error, the +3R price target is 3.18 but I'm tempted to wait until closer to their next news update (Aug?) as the demand is strong.

 

[peter2]

EOW 72 update: ASX Momentum Portfolio +28.2% ( 98% invested in 7 stocks ) SPAX2F15 index -1.3% (past 72wk)

Our portfolio continues to go up with the market and hits a new equity high this week. We'll celebrate quietly and continue on.

This weeks sells: nil
This weeks buys: A2M

We've raised our TS's higher on all trades to reduce our downside exposure (portfolio heat) and to ensure we quickly exit any trade that doesn't continue higher. We want to re-use the cash to buy something going up. We don't want to hold on to any losers for long.

We've just worked our way through a seven month draw down. How good does that feel? Everybody gets into a draw down. It's a natural occurence in trading and we spend most of our time in one.

What did we learn seeing this happen in real time?
We didn't panic. We didn't change the way we traded. We showed patience. We followed our TP when it indicated that we should protect the portfolio during the down draft in Jan/Feb. This is the key point. We didn't let the DD get too big. We limited the DD to -7% which is only three more losing trades away from our goal to avoid a DD of -10%. How easy is it to have three losing trades?

We knew the market would rally eventually and we knew our TP would profit from it. Working through every DD builds confidence, in ourselves and in our TP. Next time it happens, we'll know how to handle it and we'll know that we can work through it.

That's what I meant by celebrating quietly. Pat ourselves on the back. Learn the important lessons and continue on. We haven't conquered the market, we conquered ourselves.

 

[Boggo]

That's what I meant by celebrating quietly. Pat ourselves on the back. Learn the important lessons and continue on. We haven't conquered the market, we conquered ourselves.

Bingo

Have you had a look at weekly charts peter, that's where my winners are coming from at the moment.

 

[peter2]

Thanks Boggo, I love weekly charts (ASX equities). They keep me out of the daily volatility. I buy break-outs and pull-backs in strong weekly trends. Trading the weekly charts requires a lot less work during the week and that allows me plenty of time to look at other markets during the day/evening/night.

 

[peter2]

Trading update: Taking more profit. :

APX: Sold at T3 (3.18) which is +3R or +$1802.
Personally I've sold 1/2 at 3.15 and will let the remaining half go with a looser stop.

We've closed the last two trades at price targets (discretionary exits). ADA at +2R and APX at +3R.
Why not let them get bigger like all the text books say? Well, in the case of APX, our entry was a little late and whenever I know I'm late I'm happy to take what I can get. In this case +3R is excellent.
Our entry into ADA was better and perhaps we could have let it get higher. It has hit T3 since our exit. I decided to take +2R as the market hadn't yet made new highs and there was always a chance that the market would stall at 5400 again.

Larger parcel sizes allow some flexibility (like selling 1/2) while smaller accounts must be wary of the erosion by brokerage ($54K is a small account).

 

[Nortorious]

RMS on the move again and a fairly tight stop can come into play. I've backed this horse some more based on the action recently and the fact my position was already free carried. Other stock to look at for this portfolio would be MGX.

 

[peter2]

Trading update: New trade.

AYS: Bought BO-HR at 2.04, iSL 1.80

A classic chart setup and if price fills the gap to 2.40 it will be an acceptable RR. Today's BO coincides with an announcement that the company will introduce a broadband service.

S2R: Don't like the close <0.30 as it indicates the upward momentum has reversed, but today's trading halt prevents us selling. We can only hope the news keeps price >0.30 when it's released.

 

[VSntchr]

Hope that the S2R halt works in your favour Peter. I see the announcement is out now.

A few candidates in the hospital space at the moment:
SHL


LHC


Also, HSO and PRY (t/o rumours) look pretty good too.

Outside of healthcare there are some other opportunities such as AAC