Thankfully, (SNDA) stopped out for a 5% loss today. I'm glad I lost money on this trade, because as I said I never should've made it. Not going to say anymore about it, because there's nothing more to say.
After further review, it's obvious I sold (FUQI) too soon. Hindsight is 20/20 but one thing that really bothers me is that the stock hadn't come near it's 10 dma or 21 dma at the time I sold it. I've had my botched handling of (SOL) in my mind for a year and that clouded my judgement on this trade. The problem is that I didn't recognize some key differences:
- (SOL) was a laggard in it's group, (FUQI) is a leader
- (SOL) had several violent shakeouts, (FUQI) had never traded down more than 5% intraday from the prior day's close in the time I owned it
- (SOL) failed to find support at the 10 dma and 21 dma, (FUQI) never touched the 10 dma in the week that I owned it
- (SOL) was purchased at the end of a bull market, (FUQI) may be at the beginning of a new bull market
I still have much progress to make on recognizing the environment as well as the health of the stock I own. I'm not ready to strictly follow the 'hold for 8 weeks rule' for potential big winners, but in the future I'll at least let them test the 21 dma and see how they act. If I'd done that with (FUQI) I'd be up another 20% on top of the 20% profits I took.
With that being said, I'm going to stop regretting this trade. This is a process of continuous improvement and if my mistakes are 20% profits I'm satisfied.
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