Friday, May 30, 2008

Trading MDR On An Otherwise Quiet Day

My day was really dominated by one stock. I traded several stocks on the day, but all with 100 shares, since I didn't have any confidence in their setups... I was just taking small gambles.

I liked MDR though, and so I watched it very closely, mostly because I didn't feel there was much else happening. Volume today, was pathetic (until the close, that is) and as it was the last trading day of the month, I planned on taking it easy no matter what.

MDR was on the HCPG watchlist last night for a move up to $62. However, they added a caveat that they thought the stock needed "more time." Apparently, the stock didn't want to wait. It spiked nearly 2 points in the first 15 minutes of trade before taking a breath, at around $61. At this juncture, the stock needed to base before it could move much higher, and so it was time to chill and watch.

About a half hour later, the stock worked its way back up to $61 and I bought a few hundred shares with an average price of $61.05. He moved up and so I bought 100 more at $61.20. Now, I threw some sell limits out there up in the $61.80-$61.90 area, but they weren't hit.

Instead, the fucker reversed.

I wish I had sold out of all my shares, but I wasn't quick enough. This is a problem I have with the target system... if I'm expecting the stock to trade higher, and it fails, I'm not quite sure how aggressively I should be moving my stops up. I probably shouldn't have held my position as the stock dipped below $61, but I did.

In fact, I bought a little more at $60.89 and $60.90. So I had 600 shares, which lately, is a large position for me.

But man... that's when "the stand-off" began. For the next 20 minutes or so, the dude traded in a dime range. My "out" was $60.80, and so having "the toad" (Wincity's technical term) trade pennies above this level for such an extended period of time wore out my nerves. I flaked and sold 300 shares at an average price of $60.86. The remaining 300 I left stopped at $60.80.

I noticed on the 15 minute graph that MDR was making some NRIBs, or something... I went over to Jamie's site to see what I could find... some answer or something. From what I could figure out, he liked the setup (meanwhile, Jamie, if you're reading, am I right to think those are NRIBs on the 15 minute graph from 11:00-11:30 today?). So when the stock cleared the top of the first 15 minute bar in the "set" I bought 200 more, at $61.17. So I had 500 again and the stock began to move in my favor. I actually felt confident that I was going to be right with this one.

Still, I flaked and sold 100 at $61.34 and another near the morning highs, at $61.42.

But with my last 300, I held, and I was fairly satisfied with the results. I limited 200 of the 300 out at $61.90 expecting resistance at the old high of $62. So far, so good. The last 100 shares, I really wanted to hold, so I set my stop low, at $61.25, giving the stock plenty of room. As it traded up, I moved the stop below the previous 15 minute bar.

After the stock cleared $62 with some "brio," I decided to move my stop just below the most recent price level. The low of the move, at 12:55, was $61.86, so I put my stop at $61.85.

Well guess what? The motherfucker came down and stopped me out, filling me at $61.78, the low of the fucking move. After that, it sailed back up over $62, reaching a high of $62.72 before reversing lower to close at around $62. So I was pissed. A good trade, but I still managed to get myself stopped out at the low of a move for some shares.

I finished the month with a green day, and so, I'll take it. But man, I'm itching to start sizing into these positions more. I felt confident with this trade after it cleared $61.17 the second time around... perhaps I'll start getting that feeling more.

Also, the fact that my worst trades of the day were made with small size I also take as a good sign.

Tomorrow I'll post a "monthly review" since I set some monthly goals for myself in May, I want to assess how I did. Also, bloggerdotcom has been teasing me with some new post that he may or may not have written... that will drop, eventually.

Have a good weekend, stock market bitches.

Here's the stats:
Best, MDR,
Worst, RIG,

4200 shares traded.
9 stocks traded, 4 winners, 5 losers.


wincity said...

Nice catch on MDR, dude. Good trade too.

Not to nitpick, just a comment. I feel your first entry is a bit hasty. A crazy stock certainly could spike up to $62 and beyond, but more often than not the move would reverse due to lack of proper consolidation.

It's hard to hold winners especially after seeing your profit taken away repeatedly. I was shorting the stupid DLTR from yesterday. I was in the green many times by $0.30, yet the toad, or the fucker, repeatedly put me back in the red. Today I was green again by $0.30 but seconds later, I was red again. Finally I gave up and covered at $37.53, leaving at least a fast $.40 at the table. The toad was below $37 most of the day. Disgusting.

Sometimes I feel we should just visualize where the stock could go and forget about it. Set a reasonable stop. In the case of DLTR, I don't think a stop is needed at all. And it could easily fall $1 more Monday.

What a market. Everything is on fire. Retailers. Shippers. Truckers. Oilers. Tool makers. If you strip financials and homies from S&P, I bet we're probably at or near an all-time high.

And the bears think we're in a bear market. HA!

wincity said...

DT, I wonder if you noticed ENER and PVA at all? Were they on HGPT's list?

bl said...

DT, 30 min chart double doji's 3,4/30 then rally. I would agree hasty trades loose $.

sage08 said...

April and May have been pretty tough months for most traders. Trendless low volume back and forth price movements is exactly the kind that is most dreaded. I'm glad that i had the VO as a benchmark, so i know i'm not the only one who sucks..