Sorry, I sold on 1/7, that big downside reversal day.
I get the sense you are more of a swing trader while I am more of a position trader.
No, I am trying to be a position trader and mostly buying on IBD breakouts. Also trying to use more early entries with smaller positions. Even with a position trade on, there are certain signals IBD folks tell us to be wary of. You do see that I don’t hold some positions very long… Maybe after a week they are not moving and I think there is something better, like I just did to buy FLUT and MWA. But I want them to be longer term.
I certainly hope I did not come off in a way that offended you, I am trying to learn how others thinking and how that can help me think.
Ok that makes sense. That is what I am trying to do also. It’s really hard in this chop. Because when I get a position going it drops out. But in an upturn we can make some great headway.
Pete don’t worry about offending me, I am just trying not to offend anyone else. I hope you disagree with me and maybe we both can learn. Especially now I know that you are on the same path I am. The only thing that worries me is that when some one is a day trader or swing trader, what they do might throw me off what I am trying to do. I have no problem with the way they are investing but with a shorter time frame they are not looking at it like I am. I want to get into a position with some cushion and let it ride the 50 sma till I get kicked out.
So this is exactly what I did with Alab recently.
On 11/21/24 I bought for $106 right as it was coming off a shelf. I like those buy points.
On 12/6/24 I added a small position for $119.40
On 1/8/25 I sold all of it for $130 after that reversal you saw.
On 1/21/25 I bought back a 1/2 position as it reached down to the 50 sma for $123.40
on 1/24/25 I bought another another 1/2 position for $116.20 thinking it was going to
hold the 50 sma. First mistake. I bought lower thinking this was the lowest it
could go. Broke a rule to never buy down.
Second mistake never put on a stop because I thought I could mentally do it but went out of town.
1/27/25 had the deepseek crash. Mini black swan. Decided to hold since it was much lower than my stops.
It started coming back and I thought I would hold it into earnings. Thought I was in the clear.
2/10/25 earnings came out and it went down again. I thought earnings were good but the market decided differently.
2/11/25 sold out for $93.49 lost 24% ouch.
Ok Pete my whole problem was not setting my stops. If I would have done that it would have saved me a lot of heartache. When I started this year that was my one promise to myself and I broke it already. I thought I was over the hurdle of not selling but now I realize that I have to do it on all positions. That is the biggest lesson. The wins will take care of themselves, the losses is what I have to manage. That is everything I read, it always says manage your risk. It’s 101. Don’t lose money. It’s ok to lose 5% , you can make that back but 24% is much harder.
I was lucky with NBIS. I held it too and ended up making money. But that isn’t anyway to do this. I have to be more disciplined.
I hope this helped you Pete if you have more questions just ask. Don’t worry about me getting upset, that’s not how I roll. I usually make other people upset because of how direct I can be.
I think there is one more you can think about, and that is the 50dma. You bought on the upside reversal, because that is a show of support. It can also be called a change of character since it had been heading down for a while.
However, the Webby rule to go with that is, if it changes character and goes below the 50dma again sell, and I would say sell all (not just what you bought that upside reversal day). You can always try again when it crosses back over.
Our buy points are very similar, here are my notes…
(11/18/2024) ALAB rebounding off of low support (Dashed line) Swing trade, stop at yesterday’s low.
11/21: add pre-hours as NVDA news drives this above recent highs and $100.
12/3: strong move up on +67% vol. Probably due to great earnings from CRDO. I added a tiny bit after selling CRDO.
Be willing to sell most recent shares if we get 2 more up days.
12/20 Strong vol move up on market upside reversal day. Why not add to this??? Mistake. Sell a weak holding and move into a strong holding.
(1/7/2025) Market Selloff, sell this.
1/17: see weekly for support at 10-week line
1/21: first test of 50dma.
I can’t say why I did not buy on that upside reversal of 1/21 if I had, I can’t say I would have put in a hard stop loss or actually sold the next day if I just had a mental stop loss. That is one thing I should do more often.
My notes say my first buy on 11/18 was a “swing” trade, but when it moved above that shelf on 11/21 I was intending it to be a position trade. Bill always seemed willing to sell a position trade if the signed merited it, so that is what I did on 1/7. I am trying more and more to tell myself to just buy it back if the signal merit it. Bill did this with a number of his big runs. He may have had to sell and buy back several times to get most of a 400% run.
So, I had to sell all my CAVA today. Total gain for remaining positions was down to 2.38%. Sliced below the 50dma on +114% volume. I can’t ignore that. I love the company and the stock and still think it will be a mini-Chipotle, but I have to follow IBD rules. If I had bought this on a Motley Fool rec, in one of my MF accounts, I would not sell and I would not care. If this really goes down, I will be willing to buy a chunk for a 3-5 year hold period. When this turns around and starts building the right side of a base, I will be looking to use IBD rules again. Bummer.
I also had a trade-around-the-core position in WIX using IBD rules. It also went below the 50dma on high volume after earnings. So I sold. You can see I had no profit margin, actually a loss going into earnings, so I guess I was just hoping at that point. Did not work.
$AXON plummeted today on a downgrade and on a story that they are breaking up with a partner that is also a competitor. I bought on the strong day before and on the breakout. Earnings were 6 days away and I was going to see if I had a buffer to hold through earnings. Nope, IBD sell rule on plunge below 50dma and loss way bigger than 8%. I did not have a stop loss because I am lazy. It was above the 50dma around lunch so I was going to see how it acted near the close. I did not see it until way too late.
AXON and ANET are my #2 and #3 holding in my overall portfolios. These were acquired years ago from MF recs and I have added over the years. I have huge gains, but the 15% drop in AXON, and 6% in ANET were very painful and the main reason my accounts were down 2.23% today. Big ouch. TTD was also in my top ten. I am sure it fell out after skydiving on 2/13. But retirement is not in jeopardy
I still think AXON is a great company with lots of future potential, but I will have to do some research on this. Still not in Webby’s “quick and dead” zone for very long term holdings.
Sold or was stopped out of many position last few days I mentioned $CAVA, so here is the summary of that
I only made 5.43% since August 2024, no doubt greatly underperforming the S&P. In review, my main lesson from post analysis is that I did not sell when it sliced below the 50dma on 12/9/24. This is obvious in retrospect, but I have done this more than once. My lesson is to remind myself that I can always buy it all back if it moves above the 50dma on strong volume. I do have great faith in this stock and this company in the future, but if I buy with IBD rules, I must sell with those rules. If it tanks on earnings next week, I will probably buy some in a long-term account and just lock it away. Then I can be less emotional if I buy it with IBD rules in the future.
I bought $RDDT after it moved out of what I took as the “spirit” of a flat base. I drew in those two red dashed lines as a stop loss reminder, but I did not have a hard stop loss. I failed to follow my plan and lost more than I needed to. In fact, if I had stopped out on that first line, I would have been positive on the trade.
I made a good decision on $IBKR. After hearing Alli talk about taking partial cuts a couple times, I decided to sell 25% and lock in 13.33% profit on my youngest shares. Up 50% on remaining shares.
I sold $APP with a stop loss (finally started to use some, in last day or so). Should have set it for just below the low of the big gap up day, but went a little lower, so made less money.
For $DAVE, I set stop loss below 21dma. Normally, I would not want to sell that fast, but in this market I thought I better make that the spot. Plus, that got me out at a 6.54% loss, to keep me within the IBD loss rule.
I have some worse results I will try to post later.
I have been very active and have some catching up to do. I had a number of stocks that hit stop losses today. I have some long-term core holdings from MF and I have lots of trading positions around that as SHOP had been moving this year. I set stop losses for all my trading position and they hit today. But then it had a strong upside reversal. In the video Friday, Webby said he was taught by Bill to “bend like a tree” and that Bill could be strongly bearish one day, and completely change the next. Webby went out Friday looking for upside reversals Monday. I used this inspiration to not be scared to buy back SHOP. But I also set stop losses on all those buys for below today’s low. Taking the emotion out of it.
Sounds like I am random and betting both side of the coin. Maybe.
Also sold 50% of DUOL yesterday but bought it back on upside reversal today (pretty much at yesterday’s sell price). I am ok with that, don’t feel stupid for selling and don’t feel stupid for buying back. Have a stop loss at today’s low, so no need to follow it closely or think too hard.
Friday I but small amounts of some inverses: SARK and RWM. Almost cashed out today, but then the market started turning south and I decided to wait until end of day. We closed at lows on the indexes, so it would be “normal and natural” to continue down tomorrow, so I held.
I got stopped out of $VIK today and plan to sell $DUOL tomorrow after it fell after hours on earnings. Might as well sell IBRK and TYL and get pretty close to zero. (I have RWM and SARK inverses on, but not large enough to come close to keeping me even.)
$PLTR came to rest at a logical place today, right at the high of the last base and right below the 50dma (but not above it!). I had an alert, but will not catch a knife in this market. Just watch that area and see if it holds.
IBD says: Don’t add to growth stocks here, but keep an eye on market leaders holding up relatively well, including Booking (BKNG), Tradeweb Markets (TW), Uber Technologies (UBER) and Wells Fargo (WFC).
I do have a buy-stop on UBER if it breaks above the handle, but that is probably dumb.
$SNOW had great earnings last night and started the day with a gap up above the 50dma, but it reversed down and finished below the 50dma. If you can’t hold a good earnings gap up, something is wrong.
$NVDA finished afterhours yesterday with a small gain, but reversed down to slice below 200dma. Winter is coming.
I have been in cash for about a week. I wasn’t invested in Duol but was watching it. It looked beautiful until it didn’t. BLX looks good as does Team but nothing I want to actually buy. I think this has a chance of dropping next week on the Tariff news.
I made another brilliant move on 3/3. I intended to put a stop loss on TYL below 50dma, instead it was a limit order, so when it fell below 50dma, I doubled my position. Today it was up 1.8% Anyone want me to manage their money?
I was thinking of jumping into CRDO before earnings because I thought they would do good. Well they did do good but they also had some problems with concentration. I am glad I didn’t jump in before earnings. Be careful in this market. It isn’t forgiving like a market that is trending up.
Take a look at this one. GRRR Really good earnings and sales. Holding up really well. P/E of 13.83. Very Volatile and sales are not going to be very good next quarter. I am not sure why they would drop so much.
I added a 2.5% position in CLMB today as a trial position. It reported earnings. Bought at $128.10 stop set $121.69. I bought as it bounced off the 50sma.
I was stopped out of PLTR. Was listening to a podcast and they talked about companies selling products to the government. With all the down sizing you might want to stay away from them.
For my own education (not questioning you), can I ask your thought process and rules for the purchase. What I’m really trying to understand is IBD/your rules for your buy-point. I think you are following IBD, which I do not totally understand yet, and I trying to understand the targets and triggers.
From a standard chart and thoughts, this is in a channel, slightly down:
Classic approach to a channel is to react when it breaks through the borders. It certainly pierced the upper channel line, but closed below. Does IBD recommend purchase when ever it pierces a “line” or wait for a solid close?
It’s a good looking chart, but it’s also difficult given the current climate and external influences.
I agree with everything you have said Lake and that is why my position is very small. This is a terrible market. Do not think I am anywhere close to an Expert on IBD. But here is what I am playing on that they said. You have to test the market but test it on small positions. Check.
I went in with 2.5%. Bounces off the 50sma is a point to take a trial position with your stop under the 50 sma. Check.
Now I tried this with PLTR and you saw that I was stopped out. You have to have a place to put your stop that makes sense. Whether it be by the 200sma or 50sma or some other point that makes sense to you. So, My thing is I do not mind being wrong, but if I am I want to lose small. The idea is to not let yourself be to scared to play. So since I have been losing a lot lately I have been taking smaller positions but I still want to stay in the game and still trying. Does any of that make sense?
Noted the tiny position and wondered. Thanks for outlining. This is a market that can discourage and alienate traders. It is good to stay engaged and aware. I do the same, keeping a few positions usually sector based.
It’s hard to predict what a channel will do when it gaps up but not above a line. Still kinda like the ticker, will follow…
I am taking fewer positions but this was not even on my radar until it popped up today. If you look at it it went up and then came back in. Tomorrow if it doesn’t have another up day I will be out. I would say I was lucky but if you look at the volume it was impressive.
On another note I didn’t take a position in GRRR but the atr on that scared me. It has a 21 day atr of 20. That is crazy high.
