Monday, June 11, 2007

I'll Take It

There was a lot of movement in individual names today even if the indexes all closed close to flat.

Tha Latin American stocks like, ITU, UBB, CPA and CPL all had good gains. The steels and other metal stocks took hits. The Agriculture names like, DE, TNH, CNH and AG all moved well.

So, there was a good amount of opportunity out there today. And thus, I had some good winners. Unfortunately, I also had some decent sized losers.

My big winner was TNH. I caught a nice smooth long between 94 and 97. After the morning correction and squeeze, the stock ran up into the mid 94s, only pennies away from the high of the morning. I assumed that many people short the stock in the morning and were hoping that TNH wouldn't see 95. However, TNH being TNH, of course he'd see 95 again... he hates shorts.

With that in mind, I started buying in the low 94s expecting him to bust through 95. This went according to plan. My mistake was not letting the winner run more. I covered most by 95.5 and the rest by 96.5. While it was frustrating to see it run a couple of points higher, I was happy with the win anyway.

Another good trade I had was a short in SPG. After a hard and fast drop in the early morning, the stock trading back up to the 100 area. I figured this might serve as resistance because of the psychological impact of the even number 100 and also because it was testing the morning's opening price on a day that the REITS were downgraded. They've been weak now for the last week. And a glance at the daily chart of SPG shows a deteriorating technical situation (although here I've posted the 5-min).

Anyway, I ran into my normal mistake of taking losses by shorting strong names early. Thus, I suffered substantial squeezes in DE and MTW. I covered DE at *THE* high of the day... this added insult to injury because immediately after I covered, the stock dropped hard for almost 3 points. Sigh...

Despite making this mistake again, i.e., shorting strong stocks while they are still acting strong, I stuck to my new 3-trade rule and didn't get stubborn. So my worst of the day was a $441 loser in MTW. Bad? Yes. Debilitating? No.

Anyway, here's the stats:

P&L, $367
Best, TNH,
Worst, MTW, -$442

shares traded, 42,200
stocks traded, 23, 13 winners, 10 losers
total trades, 276


wincity said...

Your comment that TNH hates shorts has been helpful. I like to short it and has been more careful now. Still I got in a bit too early today. I shorted its 2 outbursts after 1 PM and 2 PM.

Dinosaur Trader said...


I just realized that often, when I think TNH is about to go down and "it's a good place to short" that I'm wrong and he's gonna run it up more because lots of people are watching the spikes up and thinking "this strength can't last". But it always seems to last longer and lots of shorts get shit on in this stock. So lately, I'm finding it much easier (mentally) to play the long side.

I look forward to him running to 115 soon and then dropping back to 100. Should be fun for awhile... just always a risky stock.


wincity said...

You may be right about it going to $115. Looks like it's on the verge of a break-out. However, the market has to stay up for this to happen. Otherwise, it could drop to $80 in no time.

Dinosaur Trader said...


It does have close to an 8% yield though... that should keep it relatively strong despite what the market does...