Friday, June 18, 2010

Probability and timing the market


From looking at some of my trades today you might be wondering how I can time the momentum so well. The APC trade here in particular seems like magic but here is how it happened.
Being short APC I am looking for a good time to cover. The key being that 10 minutes earlier RIG already made a jump up. I'm long RIG and watching profits grow. APC is still meandering lower. Most other oil are rising now too. So it is just a matter of time statistically speaking before probabilities start to lift APC. My gut feeling said this is no time to be short APC and if a short is no good, I must go long. The odds say so.
Moments later it starts rising strongly.
If an initial entry shows profit and the stock is lagging in comparison to its peers, the only logical action to do is to add size.
So it is far from being magic. It is just seeing and recognizing what the markets are doing and acting on the information.
1st chart is short cover and long entry
2nd chart is exit.

Alerts



Since I mentioned alerts the other day there has been a bit of interest in them. On GG here I set an alert at $45.57 which was below the high but above the consolidation range. I had noticed other gold stocks rising so I wanted to be prepared if GG broke. Moments later it did so I bot it a few pennies above...











sold it after a good run


good time to take TNA profits. market is at lows and anything can happen, a huge pop or drop.
the odds are very high that it will present another opportunity soon soi'll pocket the cash now...

short TNA












cover TNA


covered the APC short and went long


















sold APC



heres the RIG trades

long















sold, and short
















added to my position and almost immediately got stopped out. that doesn't happen to me very often after I add size, can't remember the last time...














long RIG now


where the APC pop ended up, sold it now short again



some fascinating action this morning
the market was popping up hard then suddenly stopped had APC RIG and others long

APC long














sold it, then short
















covered and long again and now its exploding to the upside