All Out

Last Tuesday I bought (CYD) on a nice breakout that staged an ugly reversal and led to about the fastest 7% I've ever lost.

Not long after I stopped out on (GFA). That one just never acted right.

This took me back to even since August. Not what I was looking for - I didn't lose money but I didn't make any either.

I've gone ahead and put myself in the penalty box for three weeks. It's the holidays, the market has been tough, and it's an ideal time for me to back off and enjoy the time with my family. I have a strong watchlist of some great stocks setting up nice patterns, so I'll be ready to take another look next year.

Without question this has been my worst year trading - but I also think it's been my most educational. We shall see.

If anyone out there reads this, I wish you and yours a Happy New Year!

New Buy:(GFA), Sell Stop:(RINO)

The current market continues to be very difficult to navigate, for me at least. There are opportunities, but a trader has to be quick, decisive, and CORRECT to profit. More experience would certainly pay off here.

Thursday my buy stop order for (GFA) triggered at $35.28. It's possible I interpreted this chart wrong and got in early, IBD had an article on the stock and called it a cup shaped base with a $37.72 buy point (if the stock does not form a handle). If (GFA) clears that point in high volume I'll add to my position.

Then there's (RINO). This stock had qualified as an eight week hold based on it's tremendous performance, then last week the company announced a secondary offering. Friday morning I stopped out at breakeven - had been up as much as 25% in this position.

I believe this was the third or fourth time I've had a high performing stock announce a secondary offering and fall apart. I've never had one succeed after announcing they would issue shares. Based on this I believe I will add this event to my sell rules - but I'll wait a couple of weeks first to make sure it's not a knee-jerk reaction.

My record is now:

1 - 2 - 6

Profitable since August.

Took Profits on (MELI)

I'm very pleased to report that I booked a 17% profit on (MELI) today after selling it for $51.76. This stock took just over three weeks to meet the 20% profit threshold, so rather than hold it for eight weeks the correct move was to take profits.

This has my current win/loss/push record since my 'August reset' at:

1 - 2 - 5

More importantly, I'm profitable since that time. Not only am I up on closed positions, but I still own (RINO) with a 20% profit and that stock has qualified as a potential big winner, so I will attempt to hold it into January.

I missed (CAAS) yesterday as technical issues delayed me logging into my trading platform and it moved very quickly, but the good news is I'm still picking stocks successfully. This means if I stick to my rules, which have been working well for the past few months, I should continue to profit.

Next stock on my radar is (GFA). The future growth of this stock is huge. I'm eyeing an aggressive buy point of $35.28 reading the chart as a short, ugly cup with handle.

The market continues to see it's skeptics which is fine with me. For now the trend is up and I'll follow it.

Sell Stop:(HMIN), New Buy:(RINO)

Last Thursday I stopped out of (HMIN) by just 3 cents for a 5% loss. The stock has since recovered nicely but that's all part of the deal. In fact, I'd rather see a stock move back up after I stop out because that's a sign of overall market health. The main thing that I still need to evaluate is my stop loss choices, I just don't have much tolerance for taking an 8% loss but I need to make sure this isn't costing me more in the long run.

Today I bought (RINO), a stock which I've watch make a monster run for the past few months. The company's latest earnings qualified it for my basic fundamental criteria and the technicals still look great so I went ahead and bought it at $27.40. This buy point is 10 cents above the previous high off a pullback to the 10 wk moving average. In this very brief correction we've just had, most of the buy points I've seen are leading stocks that pulled back to the 10 week line over a span of three to five weeks. Not an ideal setup but I'll try to take what the market gives me.

This rally has been a bit sketchy but today it finally saw a nice up day on higher volume than the day before. Having said that, volume was still well below average so a cautious approach continues to make sense. In fact, that's why I waited a couple of days before making another buy once I stopped out of (HMIN) - it's worth letting a couple winners go by to make sure I'm not over trading like I used to.

Some Catching up to do...

Once again I've fallen behind here. Time is short these days so I'll keep it brief.

Towards the end of October when I saw the market heading to a correction I moved up my stops to protect my gains (small though they were). I knew there was an issue with my timing and that by the time I'd gotten my system on track the best days of the rally were over. Therefore I was happy to exit that foray into the market even, and that's exactly what I did. Not bad really for a tough whipsawing market.

Then late last week the market looked as though it may have a follow through day on Thursday, so I took a position in (MED) which I've been looking to get into for a couple of months. The stock did well but the market did not follow through, so I closed the position with a 1.5% gain at the end of the day. Hard to sell a good stock I've wanted to own, but I will not initiate new longs in a correction.

I was out of town for a long weekend and the market did stage a follow through day yesterday which has us once again in a rally. I took a look at my watchlist last night to prepare and found that (HMIN) had released earnings and was up considerably after hours.

I bought (HMIN) on the gap up to a new high at open - this is one of the setups I look for. Additionally, I bought (MELI) as it pulled back within a couple percent of the $42.55 buy point it took out last week. I'm not totally comfortable going in this fast to a new rally, so I kept my stop loss orders tight at 4% to reduce my capital exposure until I see how things shape up.

Sell Stop (HMIN), New Buy (PWRD)

Volatility remains high and this rally hasn't gotten any easier. Trading is very tough. My recent 'success,' if I can call it that, is a result of a commitment to my rules - they are what's kept me in the game. What's encouraging is that the rules appear to work even in very challenging circumstances. There are numerous times over the past couple of months that I would've been shaken out of a position if I was actively managing my holdings - instead I've held on, and time will tell if I profit from this.

Friday the market opened hard and (HMIN) took out my break even stop loss order. This position was opened from a conventional canslim buy point well above the moving averages, and those have had trouble in this rally. Since I'd been up 10% the stop loss was at break even so that's fine with me.

My record since my 'reset' is now 0 - 1 - 2.

(EJ) has been really tough to watch. It's been up as much as 25% and come all the way back to within a few percent of my stop loss order. Turns out the company spun off a unit into an IPO of (CRIC) on Friday. That may have marked a bottom for EJ and it came off the 50 dma Friday morning and is up over 10% now from that point.

Friday I took the capital from the sale of (HMIN) and put it into (PWRD) which I've been looking to get into. It's been trading around the 50 dma for about a week. It remains to be seen if the stock is consolidating or if it will bounce off this area. I purchased close enough to the 50 dma that I was able to put my stop loss at 2% so I have very little capital at risk in this position. So far this morning it's up nicely on solid volume.

Sell Stop:(FUQI), New Buy:(HMIN)

I never got much more than 5% in my position in (FUQI), and on 9/18 I stopped out for an 8% loss - the first since my 'new beginning' this year. I'm now 0-1-1.

I took that money and invested it in (HMIN), another small Chinese stock I've been watching that had actually broken out a few days earlier. It was back within a percent of the buy point so I picked it up there.

Having said that, I will hold (EJ), which now has the stop at breakeven, and (HMIN) until they profit or stop out, but after that I will not reload until I see the market acting differently. Right now I just don't see leading stocks leading, breakouts are having trouble, and it's just very, very hard to make a profit. That's not the time to have money in the market.

I don't want to get in the business of predictions, but I think it's reasonable that the market needs to correct before we'll have another nice opportunity. Until then I'll keep watching and do my best to be ready the next time there is a chance to profit.

New Buy:(FUQI)

Early this week I took a long look at (FUQI). I reflected on some of the lessons I've learned over the past two years: I tend to overtrade, I often look for the next big winner when I already have a proven winner right in front of me, I lack patience, I lack discipline.



With this in mind I decided to chart my watchlist of leading stocks in a comparison mode (my dailygraphsonline.com subscription has this feature), using a couple of different date ranges. First I compared the stocks (I have about eight on my watchlist) from the start of this rally in early March. I found that (FUQI) and (STEC) had outperformed the rest of the stocks by a significant margin. Then I ran the comparison from a starting date of August 21st, which is the first time IBD changed the outlook to 'Uptrend Resumes' after the rally had hit a rough patch.

The picture is slightly cloudier there - (ARST) has been the top performer since that time, mostly because of a nice breakout last week. (ARST) has had a habit of failed breakouts, but so far this one has held it's gains. After that (FUQI) and (STEC) were close second and third, and then came the rest of the pack.

The reason I ran both date ranges is that I wanted to see which stocks have been the best of the entire rally, and which are showing recent strength. The answer is that (FUQI) and (STEC) fall into both categories, so this is clearly where I should focus my attention. The stocks that have led will most likely (but not always) continue to lead absent some material change.

I already own (EJ) and it's acting well, but I had enough capital for a second stock so instead of watching (HMIN) - which I do think will do well - I decided to put that money to work in (FUQI) if it broke to a new high. It's rebounding from a trip to the 50 dma so this is a valid purchase, though I now try to buy rebounds close to the moving average, not at a new high. In a stock that has done as well as (FUQI), I'm willing to risk buying after it's already made some progress.

The breakout on Wednesday was actually a failure. The stock reversed and closed lower on above average volume. I had a number of thoughts about what to do during the day on Wednesday as the stock price dropped lower and lower. I thought about putting my stop loss below some key levels and cutting losses short. Then I recalled that all the meddling I've done with my stop losses this year has cost me a fair some of money. I followed my rules, left the stop loss order at 8% and just let it go.

Thursday (FUQI) close up a percent, and Friday up 4% after being up as much as 8% intraday. It's certainly not acting great, but I'm green on the position and that beats being red. This stock has outperformed every other stock I've seen in this rally, and I'm simply betting that it will continue to do so, and that if I'm patient with it I'll profit.

(EJ) has woken up a bit, and early morning Friday my position was up 10% so I've moved my stop loss to break-even according to my rules. That leaves only the 8% on (FUQI) currently at risk.

The market itself continues to act very strangely. It was up on good volume this week, but I didn't see leading stocks acting the same way as the indexes - the leaders tended to trade on average to below average volume. This is certainly something to watch, but the system should take care of me and get me out if the market begins to falter.

Back in the Saddle

Yesterday I purchased two stocks - (EJ) and (STEC).

(EJ) made my High RS/EPS screen a couple of weeks ago so I've had my eye on it. I interpret the chart as a short, ugly cup that formed beginning the week of 6/12 and broke out on just average volume the week of 7/17. The stock advanced 40% and then corrected sharply last week with Monday's sell off, bringing it all the way back to the 50 dma.

What got my attention was the stock's action the rest of last week. While other leaders recovered in mostly below average volume, (EJ) was up on 150% average volume Tuesday and Wednesday and above average Thursday and Friday.

Based on this relative strength I purchased (EJ) about 15 minutes after the open yesterday at $19.30. Since then it has pulled back in average volume yesterday and above average volume today, so I'm in danger of stopping out. Per my rules I have the stop order at 8% below my purchase price and will target a 20% gain on this position.

(STEC) caught my attention with a massive volume move to the upside straight from the open. I missed the move and played it cautiously, holding off on any purchase throughout the day to see if the gains held. They did, and I purchased at $37.61, about 2.5% above the $36.69 pivot. So far the stock is following through to the upside again today. (STEC) is the clear leader of this rally, and should be bought at any reasonable opportunity. I intend to look for a 20% gain on this purchase but will evaluate the chart pattern further to see if this was a 10 wk pullback buy or a second high tight flag pattern. The concern still remains that (STEC) is trading at double it's 200 dma and should be due for a pause or a pullback.

Back to Cash

A bit of a delayed post here. Monday's market wipeout took out all of my stops and put me 100% cash. After the day's action IBD called the Market in Correction.

I'm not going to do anymore 'self-flagellation' as my friend puts it. I've made every mistake you can make investing. I've analyzed it and talked about it here.

Actions speak louder than words and that's why I'm not posting any big promises here anymore. I've refined and documented my rules and they are sound. All that's left is to watch the market and follow the rules.

On a positive note, I'm amazed at the response I've gotten to the forums I set up. It turns out people actually read this blog, and almost everyone who contacts me expresses that they can relate to my situation and feels we have quite a bit in common. It certainly makes any serious undertaking easier when you meet others in a similar situation - and it's great to see that there are a number of us all trying to succeed in this venture.

I believe we can do a great deal to help each other along the way.

Sell Stop:(GMCR)

Following the new rules I stopped out of (GMCR) today at break-even - it had advanced 10% so that's where I had my stop at $65. It bounced off the $63 level and looks to be coming back, but that's fine - the rules are in place to keep me from losing money.

At this time I still own (UTA) and (ARST), the former comes out with earnings tomorrow before the market opens. As I've learned this year, the key is going to be finding one or two winning stocks and sticking with them. Maybe (UTA) could be this stock - if not I'll look for the next opportunity.

Been Some Time...

I've taken just about a month away from posting here while I've tried to regroup. I started writing this blog to improve my trading results, and at a certain point it was doing the opposite - the idea of writing about my failed trades day after day began to lead to more failed trades. Trade review is very useful to an extent, but in a case like mine where I basically derailed, I don't think there was any purpose to beat myself up several dozen times. Instead I stepped back to look at the bigger picture, see the forest rather than the trees, so to speak.

The first thing I recognized, again, is that I'm extremely successful identifying winning stocks. The following is a list of the stocks I have owned at some time this year (some I've owned more than once):

(SNDA)
(TNDM)
(ARST)
(LFT)
(FUQI)
(TSRA)
(PWRD)
(GMCR)
(STEC)
(VIT)
(UTA)

There is no question this is an outstanding list of stocks, representing most of the top leaders of this rally. I'm not bragging, on the contrary I managed to filter down to a list of the best stocks in the market and still lose money! As bad as this is, there's a positive side. I know my problem is WHEN I'm buying stocks, not WHICH stocks I'm buying. That actually gives me a great deal of hope that I can improve my results.

So this is what I focused my review one. I wanted to know in general where my timing was wrong.

1. I found that my success rate on breakouts from bases was fine. If I'd only bought breakouts from bases I would've made only a few trades and I believe all of them would've been profitable - two of them massively so. Which brings me to my second realization.
2. On base breakouts I need to observe the 20% in three weeks rule. This rule states that if a stock advances 20% in less than three weeks it has the potential to be a big winner, and you should attempt to hold it for eight weeks. If I'd done this, I would've doubled my money on (SNDA) and (FUQI). Which brings me to point three.
3. Stick with the 7-8% stop loss rule in most situations. Early in the rally the market gave a very negative sign by logging a distribution day. I moved my stop loss orders up and stopped out of (SNDA) and (TNDM), both of which went on to be winners. In my fear of suffering a loss, I cost myself the kind of gains that make a year for a trader. By not allowing these purchases to work I forced myself to allocate the money elsewhere, often in less successful trades. Which brings me to point four.
4. Money is made in the market by sitting and waiting. I will not be successful from making a lot of small winning trades, but from finding big winners and letting them work until they show signs they are not working anymore. This is closely related to point 2, different side of the same coin you could say. The point is that by leaving my capital in a winner, I don't have to risk it in another stock which is an unknown quantity.
5. Buys when a stock bounces from the 50 dma are TOUGH. Buying even the best stocks at a new high after they've found support at the 50 dma has just not worked for me in this rally. They've tended to advance around 10% and then retreat. I suspect this is because the support lines are so far below the stocks, which have made rapid advances, that they are 'tired' by the time they make a new high. Whatever the reason, based on my experience I've changed my approach in two ways I'll outline below.
6. Once a stock has advanced 10% from the proper buy point, I'll move my stop order to the proper buy point. If a stock advances 10% I don't want it to turn into a loss. Obviously I must buy as close to the proper buy point as possible for full effect here.
7. I will buy a stock that has found support at the 50 dma if and when it closes above the 21 dma on 150% average volume or greater. I will buy at the end of the day if the close above the 21 dma is certain, or I'll buy the stock the next morning. I will only look for a 20% gain on bounce buys.
8. I will buy a stock that has a breakaway gap up opening to a new high on earnings news with massive volume no matter if there is a pattern or buy point. This setup is highly effective from what I've seen, and is therefore worth buying into. The stop will be 8% or 50 cents below the low of the breakaway gap day - whichever is higher.

To the best I was able to determine reviewing my activity this year, the simple changes above would've produced four 50 dma bounces stopped out at break even, one 50 dma bounce for an 8% loss, two 50 dma bounces for a 20% gain, and two base buys for 90% and 120% gains respectively. Obviously the last two are the trades that would easily have made my year, but what else is important to note is that I would've only had one trade for an 8% loss.

I don't want to overstate the results of a review because it's impossible to revise history. I can apply all these rules to past trades but in the moment it's never that easy. Nonetheless, I must continue to work toward a more mechanical and repeatable method, and I think this is another step toward that end.

I've already applied this to my current portfolio. At this time I own:

(GMCR), (UTA), (PWRD), and (ARST). The first three were bought from bases. (UTA) has qualified as a potential big winner and I have the stop in at $12.70 and otherwise will try to hold the stock until 9/22. (GMCR) and (PWRD) must advance further on Monday to qualify as potential big winners - (PWRD) may do this as it releases earnings on Monday. Otherwise I will target both for a 20% profit. (ARST) was a purchase off the 50 dma and I already have my order in for my 20% profit target. I did own (VIT) which had advanced 10% and then stopped out, no loss as per my new system - nice not to have a 10% gain turn into a 5% loss!!!

Well, that's it for tonight. we'll see what the market has in store for us tomorrow.

Sell Stop:Everything

I've stopped out of everything, I'm 100% cash and I'm back in the penalty box for three weeks.

Might as well quote a friend here:

"you are talking the talk but not walking the walk..."

In short, I made two huge mistakes:

• Ignored my penalty box rule - thought that I knew better than the system and didn't want to miss a move - this rule would've saved me my last 4 failed trades
• Put far too much capital at risk. I've added a spreadsheet to make sure this number never exceeds 3%

Now the question is, will I keep developing a sound system and keep failing to follow it.

Sell Stop:(GMCR), Continued Review - Focus on Impulse and Risk Management

Happy Independence Day to any proud American citizens out there!

Thursday my addon buy for (GMCR) stopped out for a loss. Rather than address this trade specifically, I'll include it from a philosophical standpoint in my continued review of this year's trading. I believe I've been able to filter down to some key points that will further force me to manage my risk better.

First of all, I believe I need to better manage my impulses. This is more difficult and not as obvious as it sounds when it comes to trading. Part of good trading is recognizing when a good stock is making the right move and being willing to buy it at that moment - likewise on the sell side. However, this is a very fine line to walk. I can easily be whipsawed by fluctuations if I misinterpret them as signs of a trend.

Secondly, when I'm buying off a support level like a moving average, I would rather buy close to the moving average with a tight stop than to wait for the high volume move up off the line. Maybe I'll change my mind about this after more time, but from what I've seen this will put the odds more in my favor.

Most importantly of all, I need to manage my risk better. I put too much capital at risk in the market at any given time. When I take several new positions within days of each other, none of them has time to move in the right direction and give me a profit cushion, allowing me to raise my stop loss order. This means I have 5% at risk in several positions, effectively putting 5% of my total portfolio at risk at one time. With margin, this number can get even larger. From this point on, I will have no more than 3% of my capital at risk at any given time. I may eventually lower this number. I will not be able to take new positions until the positions I hold are working - this alone should help me tremendously.

As far as the trade review goes, the next one on the list for me to discuss is just downright embarrassing. This was my attempt to short the S&P 500. Three times.

Once I saw the distribution day early in the new March rally and realized this meant there was a good chance the rally would fail, I stupidly attempted to short the S&P 500. There's not much worth discussing here, I've been investing for only two years and I have absolutely no business shorting the market. This group of trades comprises half of the money I'm negative on the year.

With my next post I'll begin to investigate some trades I might be able to learn more from than this simple and obvious mistake.

New Buy:(STEC), Addon Buy:(GMCR), Mid-Year Review

It looks a bit like I'm trying to trade my way out of a slump. I'm caught a bit between a rock and a hard place. On the one hand, I've over traded, made poor decisions, and lost some money. These factors indicate I should slow down. On the other hand, the rally is working, and leading stocks are acting well and breaking out. This is an excellent opportunity to pick up some stocks that I've been watching for an entry point for weeks. Never bashful, the latter is the approach I adopted. I'm not going to let past failures keep me from buying good stocks at the right time.

My first position in (GMCR) came close to stopping out on Russell Rebalancing day last Friday, but quickly recovered this week. I still haven't seen the volume come in they way I'd like, but the stock seems to be acting well around key support levels. I've been watching it bump up against $60 for about a week, so when it passed through that level I added to my holding. I would like to see the stock make a new high next week when the traders return from vacation.

Additionally, I've been patiently watching (STEC) to see if it would form a high tight flag pattern. It got impatient and broke out today after correcting only a week, and I bought it just above the previous high at $25.33. This stock has as good a technical and fundamental pedigree as anything I've seen. Now it just remains to be seen if that translates into 'monster stock' status.

That's my trading activity today, but I've been giving a great deal of thought to my trading activity this year. I started out quite well, and at this point I'm doing as poorly as the last two years. That is a wakeup call and an indication it's time for me to seriously evaluate what's worked and what hasn't. For the first time I feel I've progressed enough to gain some real value from reviewing the charts of my purchases. In the past that was nearly pointless, because most of the time I was buying crap. This year I've traded fantastic stocks, but more often than not I've timed my buys poorly. It's my goal to further quantify my purchase process in a way that is flexible but successful and repeatable.

At this point, my record on purchases is 2-11-2. With my goal being to hit .500 on my stock picks, I'm a long, long way off. That's fine though - the important thing is to get it right from here, I can't undo history.

Tonight I'll look at my first two purchases, (SNDA) and (TNDM), which I purchased on 3/12 and 3/13 respectively just as the market followed through on this rally.

(SNDA) had broken out from a double bottom pattern prior to the start of the rally on week volume. It reversed the following week all the way back to the 40 wma, where it found support. It rode this line and then the 10 wma right up until the follow through day where it broke out in above average volume, and this is where I bought it. The chart does not show the obvious accumulation that I tend to look for now (think the bars in the ATT wireless adds), but adding up the weeks in the chart the ratio was more toward accumulation than distribution.

(TNDM), on the other hand, did sport obvious accumulation in the chart. The volume soared in the weekly chart as the stock climbed the right side of a well shaped cup base. Like (SNDA), (TNDM) broke out ahead of the follow through day, then consolidated further, and exploded to new highs from the 10 wma on the follow through day.

Both stocks were in strong industry groups at the time of their breakouts, and both proceeded to notch gains of 20% or more before correcting. So why did I sell them for no gain?

Just two days after the follow through day, the market logged a distribution day across all the indices. Historically, this has spelled doom for a new rally 90% of the time. Still gun shy from my prior failures, I played it safe, moved my stop loss orders up, and stopped out of both positions in a couple of days.

Lessons Learned:

• Watching the market is important, but listen to the stock too. Both of these stocks were acting well and probably deserved some room to work.
• Trust the 5% stop loss. If I'm buying the right stocks at the right time in the right market, the 5% stop loss should protect me. I have to be careful moving stops, although I will do so to put it near key support levels when the situation calls for it.
• Don't be afraid to lose money. I should feel fear before buying a stock, not after. I should imagine how I will feel if the position doesn't work out, and if I will regret the purchase. Once I determine it is a sound buy, I should leave the stock alone and let it work (within reason).

All in all these positions were listed as a 'Push' - neither a win or a loss. They went on to be winners, but there was a strong argument for selling at the time that I did. I bought good stocks at the right time and sold for a sound reason, so I consider these fair trades that I do not regret.

I'll get into some trades that I do regret in my next post...

Sell Stop:(PWRD)

The Chinese MMORPG group got destroyed over the past couple of days after the government changed some rules so that gamers could no longer buy real world goods with in-game currency. My position on (PWRD), which was looking extremely promising, ended up at an 8% loss (the maximum I'll accept).

I started out the year well, and now I'm in quicksand. I've been here before. I'm pressing, struggling, and the harder I struggle the deeper I sink (more money I lose). PWRD was unfortunate because it was more a case of bad timing/unforeseen news than an issue with stock. The situation changed dramatically a couple of days after I got into the stock.

Nonetheless, this is a danger zone and I need to be very careful from here on out. I'm in two good stocks, (ARST) and (GMCR), and I'm watching (STEC) for the formation of a high tight flag pattern. Other than these stocks, I need to exercise caution and patience more than anything else right now. The losers are eating the winners alive.

New Buy:(GMCR)

Friday I thought I had the opportunity I've been waiting for to pick up (GMCR) as the volume started to come in while it retook the 21 dma after finding support at the 50 dma. I bought around $59 only to watch if fade throughout the day and get hammered in the closing minutes.

Most likely it was a Russell Index rebalancing move, but I don't know what that means for the stock today except that it leaves me in a precarious position. The stock is right near my stop, which I'm removing this morning for a bit until I see how the stock settles in and trades. This is the only situation that I ever leave myself vulnerable to a greater than 8% loss, but 90% of the time it's worked out in my favor - in fact I don't recall ever taking a loss greater than 8% on any position.

Of course, now that I've said that...

Quick Hit at the Open

I've said a number of times that I don't like leaving stop loss orders in at the open if a stock is close to stopping out, as the opening 15 minutes are often not indicative of a days action. Today this came true as I was whipsawed out of (PWRD) in the opening minute of trading - I wasn't watching the market at the time.

The stock promptly recovered and I purchased it back again at the same price, $30.15, adding a secondary buy at $30.74 as it made a new high. This stock has the massive ramp up in volume that has accompanied the winning stocks I've had in the past, we'll see if (PWRD) can do the same. I've definitely seen my optimism of earlier this year as I've struggled and made far too many mistakes. It's time to get back on track now.

Sell Stop:(TSRA); New Buy:(PWRD); Addon Buy:(ARST)

It was a busy day. I stopped out yesterday on (TSRA), which I had set the buy stop order wrong for. I've been on a not so smart streak lately and that just capped it off. After my strong start this year, I'm now just basically even and really need to be careful that I don't get into old habits of 'swinging away.'

Of course having said that, I made two new buys today... I've torn because I see so much opportunity - so many leading stocks are offering entry points here. One of my buys was (ARST) at $16.37 as it found support at the 50 dma for a second time since it's initial breakout. The relative strength on this stock has been improving, and it's worked for me so far, so I tried to go back to basics and add to what's working.

I also purchased (PWRD) at $30.15. This stock has been been popping up on my screens lately, and I just can't ignore the massive volume it's seen as it moves up the right side of what I see as a long and deep cup pattern. IBD says it has not offered a proper base, but neither did (FUQI) according to them. All I want to see is a stock clearing resistance on massive volume, and that's what I think I'm seeing with (PWRD). In fact, this quality was lacking in my recent failed purchase on (SNDA), which could've been bought better today than when I bought it last week. Back to my mantra, buy strength, not weakness.

Tomorrow should be interesting, with the low summer volume and post-FOMC-volatility.

Sell Stop:(SNDA), and a Rookie Mistake

Today (SNDA) stopped out as it dropped below the 50 dma. I still believe I'm going to have more success buying 50 day pullbacks around the moving average, but would be better off waiting until I see some volume come in to the upside.

I also made a pretty stupid mistake. I set up a couple of buy stop orders Sunday night, as often do in the evenings, but I had the price wrong and ended up buying (TSRA) around $24.26. I like this stock, but wanted to see it clear $25.14 before buying as I think I see some resistance around that area. Of course today was also not the day to take new positions in anything.

I'm not convinced this rally is done, but I've racked up 3 failed trades recently so I'm going to pause any new activity for now and just manage my current positions. The three failed trades are not (yet) in a row as I still have a successful trade working in (ARST), however common sense dictates caution at this time.