What the Novice Investor Has Learned this Year Submitted by teamonfuego (2158 comments) on Tue, 08/31/2010 - 10:05 #68204 1.) When it looks like prices will fall off a cliff, they rally. 2.) When it looks like prices will explode higher, they nosedive. 3.) Everything is technical > technical analysis is the way to profits. 4.) If short, take profits ASAP. 5.) If long, take profits ASAP.
My take going forward: none of these will work. The average investors is scared sh*tless to hold anything long for anything longer than a week. This makes me more bullish than I have been in almost a year.
Someone asked me the other day why I thought the market was fluctuating on a daily basis, when I told them I thought it was due to computer trading they thought I was talking about retail traders trading from their homes.
cheapybob - don't let your emotions get the best of you. even though the system sucks, it can reward contrarians. when things are bad and everyone knows it, it's probably not a bad time to be buying.
A while ago, I figured that gold is my only high-conviction long for the next 5 years. However, instead of just holding it, I figured I would swing trade a little around my core position. I added 50 shares during the pullback a month ago at $117.40, and today, when gold has reached its previous high, I decided to take profits and just sold those 50 shares at $122.04. Will reload during the next 5% pullback.
Nice trip except for the 2 straight days of rain and the fact that I was unable to come close to my goal, namely parring the tiny little Chatham Seaside Links course.
I have missed you guys and also I missed the really nice runup in EXK last week. It made something of a retest of a low, and maybe a bit of a bulish spring as well coming back into the range after threatening down.
Also, I made a small amount of money on a PAL long earlier today.
No dating stories unfortunately. My best one this year was a really cute Phillipino woman I met at the car dealer; we went out one night and sucked face 'till the cows came home.
She gave me a little bit of hemming and hawing on the phone the next day ("I had an awesome time last night, and you're really cool and nice but I think we should probably be just "friends") and I honestly didn't feel like trying to talk her into anything even though I bet I could have. Actually I'm thinking of inviting her back to the beach one of these nights for a repeat performance and it'll be interesting to see if she says yes.
Also a woman I knew back in college got in touch with me but she isn't really right for me and I haven't seen her. Kind of a lonely shark I is:)
2nd_ave, TOF: a rally in equities has to be supported by a rally in bond yields, just like it happened on Friday. I am a cautious bull at this point, as I think the market *might* stage a nice rally soon, but being burned so many times while buying in the way down, I decided to use my recent day trading experience and play this rally as a trader. That is, I want to enter it on the way up, and as soon as I will enter, I'll place a sell stop order at the entry price to make sure that I "don't let a profit turn into a loss." If I get faked out a few times -- that's OK, my Ego will survive it, and my portfolio won't suffer at all. :)
Right now, the intraday charts over the past 5 days suggest (to me) that a "breakout" level for TBT would be $31 and for INTC it would be $18. So I have just placed a buy stop limit order for 300 shares of TBT at $31.08/$31.10 and for 300 shares of INTC at $18.05/18.06.
CI, I do have a small long-term position in PNP.TO. I had the intention of adding to it when the current market decline subsides -- I might have missed the bottom in it... On the other hand, I am pretty sure I'll still have a chance to add to it when S&P drops below 950.
David: you certainly pick the stocks that are volatile, but your picks are great for trading. I have given up on trying to figure out where the bottom is. PNP.to gave me a bullish signal on July 21st - Wednesday and it has given me heartburn with the up and down moves. I almost gave up on it and was ready to sell and get out flat.
David: FirstEnergy Capital analysts have a downbeat view on Natural Gas.
They now feel natural gas will trade at an average of $4.75 per Mcf in 2011, down from their previous prediction of $5.50. Previous to this they were expecting $6.50. They are downgrading an number of Canadian oil and gas stocks.
2nd - I think that's going to happen...in fact, it would be a bitch to bears if there are a few gaps up in a row. The SPY index fund is already up $0.50 from the close in after hours. China PMI is a big market mover overnight. Assuming it comes in somewhere in the low/mid 50's, I think we would have a gap up.
CI: the analysts ALWAYS downgrade their view of something when its price goes down. They are always behind the curve. My point about NG is simple: the amount in storage has been growing slower (over the past 2 months) than the 5-year average, and if this continues, the price WILL move significantly up.
The Case-Shiller was actually pretty good.
ReplyDeleteLet's see what Chicago has to say.
INTC now a bottomless pit
ReplyDeletecb- It's not a bottomless pit, it's a buying opportunity.
ReplyDeleteI guess I was very wrong on INTC. I hate when that happens.
ReplyDeleteThis whole country is done for. Complete toast within 6 months, IMO.
Sold the DGP too early, but at least it made my day profitable.
ReplyDeleteMaybe you are right. I can think of absolutely no vadil reason whatsoever to buy INTC here, so probably nobody else can either.
ReplyDeleteIs the dog alright, cb?
ReplyDeleteMan, their whipping this market all over the place.
ReplyDeletecb- Stop thinking one day. Start thinking one year. You could be up big on INTC in a year.
ReplyDeleteNo, she pooped on the rug last night. She is LITERALLY on my shit list
ReplyDeleteWhat if the market reverses again today, closing up +170? Wouldn't that be a head trip. Especially for those who sold at the open.
ReplyDeleteOf course, it could also close down -170, in which case I'll have my own head trip to deal with.
ReplyDeleteBut I'll deal with it.
ReplyDeleteWhat the Novice Investor Has Learned this Year
ReplyDeleteSubmitted by teamonfuego (2158 comments) on Tue, 08/31/2010 - 10:05 #68204
1.) When it looks like prices will fall off a cliff, they rally.
2.) When it looks like prices will explode higher, they nosedive.
3.) Everything is technical > technical analysis is the way to profits.
4.) If short, take profits ASAP.
5.) If long, take profits ASAP.
My take going forward: none of these will work. The average investors is scared sh*tless to hold anything long for anything longer than a week. This makes me more bullish than I have been in almost a year.
I'll pay more attention to these moves in 2 weeks...
ReplyDeleteAlmost added BAC on that spike down, but I think I'll increase JPM instead. All those Wamu branches are Chase here in Ca.
JPM - You're gonna Chase it?
ReplyDelete1040 - Kinda looks like someone's been accumulating there. Are they distributing above 1050?
ReplyDeleteOne could buy in the morning, sell before noon, and spend the remainder of their day on the putting green.
ReplyDeleteOne could also buy now, sell next year, and spend a lot of time on the putting green.
ReplyDeleteCP- I think the range is more like 1040-1041 ;)
ReplyDeleteDon'tcha just love the advice not to catch knives and not to chase?
ReplyDeleteYou're gonna be doing one or the other, the way I see it.
Someone asked me the other day why I thought the market was fluctuating on a daily basis, when I told them I thought it was due to computer trading they thought I was talking about retail traders trading from their homes.
ReplyDeleteIs that it for the day?
ReplyDeleteStill about 40% long with all the same positions.
1041 - 1050 trading range narrowing? Which way will the breakout go, up or down?
ReplyDeleteAll the HFT computers are done for the day and now they're standing around the water cooler shooting the breeze.
ReplyDeleteINTC catching a little bid here.
ReplyDelete"I was too busy smiling in the mirror to be doing my job. That's life. We do the dumbest things at times."...
ReplyDeleteBill Cara.
Finally, Bill says something I actually believe:) And isn't that the most classic Bill line ever?
CP - the CEO of VMware is coming up on CNBC - he'll probably do a much better job of describing the cloud computing oppty than i've done.
ReplyDeleteshark - welcome back. Yes, I saw Bill's humble comment too...
ReplyDeletehey shark - any dating updates??? since i'm getting killed this a.m. in the market i could use a fun story.
ReplyDeleteSee you guys at the close.
ReplyDeleteHe uses the mirror b/c it looks larger that way.
ReplyDeleteToo depressing to watch. Up $1500 net, taking the chips and walking away. This whole system sucks bigtime and deserves to crumble.
ReplyDeletecheapybob - don't let your emotions get the best of you. even though the system sucks, it can reward contrarians. when things are bad and everyone knows it, it's probably not a bad time to be buying.
ReplyDeleteA while ago, I figured that gold is my only high-conviction long for the next 5 years. However, instead of just holding it, I figured I would swing trade a little around my core position. I added 50 shares during the pullback a month ago at $117.40, and today, when gold has reached its previous high, I decided to take profits and just sold those 50 shares at $122.04. Will reload during the next 5% pullback.
ReplyDeleteHey guys,
ReplyDeleteNice trip except for the 2 straight days of rain and the fact that I was unable to come close to my goal, namely parring the tiny little Chatham Seaside Links course.
I have missed you guys and also I missed the really nice runup in EXK last week. It made something of a retest of a low, and maybe a bit of a bulish spring as well coming back into the range after threatening down.
Also, I made a small amount of money on a PAL long earlier today.
No dating stories unfortunately. My best one this year was a really cute Phillipino woman I met at the car dealer; we went out one night and sucked face 'till the cows came home.
She gave me a little bit of hemming and hawing on the phone the next day ("I had an awesome time last night, and you're really cool and nice but I think we should probably be just "friends")
and I honestly didn't feel like trying to talk her into anything even though I bet I could have. Actually I'm thinking of inviting her back to the beach one of these nights for a repeat performance and it'll be interesting to see if she says yes.
Also a woman I knew back in college got in touch with me but she isn't really right for me and I haven't seen her. Kind of a lonely shark I is:)
2nd_ave, TOF: a rally in equities has to be supported by a rally in bond yields, just like it happened on Friday. I am a cautious bull at this point, as I think the market *might* stage a nice rally soon, but being burned so many times while buying in the way down, I decided to use my recent day trading experience and play this rally as a trader. That is, I want to enter it on the way up, and as soon as I will enter, I'll place a sell stop order at the entry price to make sure that I "don't let a profit turn into a loss." If I get faked out a few times -- that's OK, my Ego will survive it, and my portfolio won't suffer at all. :)
ReplyDeleteRight now, the intraday charts over the past 5 days suggest (to me) that a "breakout" level for TBT would be $31 and for INTC it would be $18. So I have just placed a buy stop limit order for 300 shares of TBT at $31.08/$31.10 and for 300 shares of INTC at $18.05/18.06.
Swing trades working well today.
ReplyDeletePNP.to (one David likes/liked) up 11.54%
K.to (one I am told bill traded) up 4.0%
ECU.to up 18% from where I bought
Hard part now is trying to figure out how high is high. Once again pushing into new territory as my portfolios are at new YTD highs.
CI, I do have a small long-term position in PNP.TO. I had the intention of adding to it when the current market decline subsides -- I might have missed the bottom in it... On the other hand, I am pretty sure I'll still have a chance to add to it when S&P drops below 950.
ReplyDeleteToday's drop in UNG was bought -- it is a definite pattern change from what was happening over the past month.
ReplyDeleteOh yea, back to 1040! Duh, should'a known we'd go right back once 1050 was hit...
ReplyDeleteCSCO trying to fill a gap ALLLL the way back to last July @ 18.94???
ReplyDeleteDavid: you certainly pick the stocks that are volatile, but your picks are great for trading. I have given up on trying to figure out where the bottom is. PNP.to gave me a bullish signal on July 21st - Wednesday and it has given me heartburn with the up and down moves. I almost gave up on it and was ready to sell and get out flat.
ReplyDeleteSo....
ReplyDeleteWhat turns this mess around? The last few times its been the Fed or Congress saying or doing something to end the panic.
We are now conditioned to wait for it, IMO.
David: FirstEnergy Capital analysts have a downbeat view on Natural Gas.
ReplyDeleteThey now feel natural gas will trade at an average of $4.75 per Mcf in 2011, down from their previous prediction of $5.50. Previous to this they were expecting $6.50. They are downgrading an number of Canadian oil and gas stocks.
Volume was pretty heavy today. I absolutely loved the close. Of course, I'm long, but the bulls won a big struggle today.
ReplyDeletetof- If we do move up from here, it would almost have to start with a gap up- to disallow easy boarding.
ReplyDeleteThat's what I'm looking forward to.
2nd - I think that's going to happen...in fact, it would be a bitch to bears if there are a few gaps up in a row. The SPY index fund is already up $0.50 from the close in after hours. China PMI is a big market mover overnight. Assuming it comes in somewhere in the low/mid 50's, I think we would have a gap up.
ReplyDeleteOkay, so are we going to fade morning enthusiasm and buy back into afternoon discontent?
ReplyDeleteSeems like I'd have a lot more money in my account if I were doing this...
CI: the analysts ALWAYS downgrade their view of something when its price goes down. They are always behind the curve. My point about NG is simple: the amount in storage has been growing slower (over the past 2 months) than the 5-year average, and if this continues, the price WILL move significantly up.
ReplyDeleteIt seems to me like ESLR is ready to embark on a decent countertrend rally, which can morph into a new long-term uptrend. What do you say, shark?
ReplyDeletenew post
ReplyDelete