Tuesday, August 17, 2010

Review Your Trades and Learn

Sunday I put out a Top 10 trade Ideas for the Week which included a long set up for 51Job Inc, Ticker: JOBS. My premise was that it was waving a nice flag after the recent run higher. If it got above 27.15 it could run maybe as high as 33 on a measured move, but at least to 30. Here is the daily chart up to today.

51Job Inc Ticker: JOBS

You can see from the last two days that the trigger went the stock did go higher. Now lets look at the last 3 days in detail.

51Job Inc Ticker: JOBS 5min Trading Chart

From this chart you can see that the trigger did not happen until 3:40pm on Monday. I do not usually initiate a trade in the last half hour or first half hour so I let it go. Tuesday morning the stock opened with a bang and settled very quickly between 28.40 and 28.60. This was a classic bull flag on declining volume so I bought it at 28.45. The stock popped and ran to a range between 29.31 and 29.51. I sold 1/3 on the way at 29.20 and the rest at 29.40. I re-entered at 29.41 an hour late on what appeared to be another bull flag and ran it up only to be stopped out break even just before the close.

Why do I write this? To brag about a good trade? No to learn a lesson and make a point. I did miss a good part of the run due to my trading rules. But without trading rules you do not have discipline and therefore do not have a plan. you can make exceptions to your rules if your plan deems it important. Second, I want to learn from my mistakes. When the price started to rollover at 3:35 it should have been a clue to me to protect gains and get out. I did not. I will remember that now. Lesson learned for me. For you: Review your trades and learn what else you can do.

Trade well.

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