Hello to Alan, or Big Al, not sure which you prefer. It’s nice to know that there are a few people reading this and I hope it is of some use to you. Stick with it as I aim to improve the site over time.
From what you have said Big Al it sounds like you are doing ok so far, which is more than I can say for myself. I have no one else t o blame but myself for trading my funds so low. Trading without a strategy, boredom trading, copying other peoples trades have all lead me to the low funds I have today. Back at the start of the year I was trading my way back up to break even but it seems since then I have been an absolute Muppet trading without any real strategy and losing good money after bad. In the past few weeks I have given myself a good kick up the backside and I am trying to develop some winning strategies and try to return to winning ways before my account gets wiped out.
Anyway moving on from my tale of woe. It was a fairly quiet week, by recent standards, for me. This is a good thing. The whole point of me trading is to be able to quit my day job to have more time to other things. I don’t want to replace my current day job with sitting staring at charts all day long. Don’t get me wrong I would prefer to look through charts look for new trades than do my current Job but my goal is to get to the place where I can look for new trades a few hours a week and then monitor them each day at the end of the day.
I’m sure if/when I do get to the point when I can quit my job I will look for trades on a more frequent basis than weekly, but the general Idea of me spread betting is to give me more time to spend with my family and do other things that I have always wanted to do.
The FTSE closed the week down. I think it was mainly due to the US jobs data coming in lower than expected. I find it fascinating how all these world events affect all the markets around the world. The FTSE 100 started the day looking positive and rising around 50pts. Then it started to trade down until 13:30 when the news was released and the FTSE tanked about 80pts in 10 minutes.
This dragged some of my positions down and one (Northgate) stopped out at 167. With hindsight I should never gotten into the Northgate trade. Although it was showing momentum divergence I didn’t set the buy price at the high of the previous week. This was a conscious choice and one that I shall not be repeating. I reduced the buy price to meet my £10 risk level. I think the actual risk was more like £30 which at the moment is too much for me to risk on 1 trade. I guess I have learned a lesson the hard way here.
From now on I will be true to my momentum divergence strategy. I am also working on a new MA strategy based on a 200day MA. Does anyone else use MA crossovers as buy/sell signals? If you do I would love to hear from you and your experience with them.
Anyway I will be doing my FTSE analysis tomorrow and checking for any new orders for the week. The orders that failed to execute over the past week will be re-assessed to see if they still qualify to be placed this week.
Below are my account stats for the week. I have added a new column to indicate the change in value since the previous week. This week my portfolio value dropped 12%. Will next week be a winning week? Hopefully it will, but who knows. I have updated my open positions which you can see here. Most of them are showing losses but a few are in profit. I do have a bit of a dilemma as to when to move my stop with one. My position in Alcatel Lucent has been showing momentum divergence and would’ve executed according to my strategy last week. I brought Alcatel Lucent because I identified a support line. So do I now trail my stop according to my momentum divergence strategy or do I trail at 2ATR to break even then 3ATR after(this is my tailing stop strategy for support buys) or do I trail it some other way. I think I’m inclined to trail according to the momentum divergence strategy but I would love to hear other peoples thoughts on this.
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Date
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Valuation
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Cash
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Available
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Risk
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%
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5/06/2010
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309.03
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304.83
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138.1
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114
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-12.64
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That’s all for now.
Until next time
“May the markets be with you”
Hi again
yeah not a great week – it's the volatility of the markets that's so difficult; it seems indices world wide are over-reacting to every piece of news. What with Greece, the Euro, BP etc., etc., it's a minefield out there, especially for novices like myself…
Which is why I'm trying to be cautious, disciplined, patient and all the other good things that prevent financial disaster. I'm only doing relatively well in that I'm managing to limit my losses until the current madness abates; I haven't really gained any money yet!
My trading strategies are pretty basic and keep research to the absolute minimum. Basically I watch prices and trends along with 52 week highs/lows, channel breakouts, ranging prices, etc. I watch SMAs for crossovers – 20/40 SMAs for short term trading and 200/400 SMAs for long term trading. All this is backed up with minimal company research and a general overview of markets/world events every day.
I only trade shares at the moment and I never day trade as the only time I did this I burnt my fingers; same for indices as I believe this is not for the faint hearted (maybe a year or so down the line when I know what I'm doing?).
I suppose I'm a technical trader with a smattering of fundamentals. I do truly believe in the principle of 'KISS' – 'Keep it simple stupid'. My ambition is to get rich slowly as well, and to give up the day job when, and if, I'm earning £1500-2000 monthly.
Finally I supplement my trading strategy with many harsh rules and regulations to help minimise losses; so far I've been about 95% successful in keeping to these rules (which are too many to mention).
It goes without saying that I still have much to learn; my main ambition is to just keep solvent until some sort of sanity returns to the markets.
BTW I'm not in a position to give advice to anyone but I can't help making a comment about Alcatel Lucent which you've mentioned a few times. I've just been looking at the charts using SMAs and, based on my simple systems described above, I would rate this as a reasonably 'safe' short/medium term SELL. The SP has been trending down for over 6 months and whatever combination of SMAs you use there's a SELL crossover.
Anyway that's all for now. Keep up the good work!
Cheers, Alan