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Steve's Trading Diary - November 2008


11/26 Bought LNC on the positive open on Friday. It moved up nicely. Continue to hold as long as it stays above the T-line at around the $11.50 area. If it starts coming down from the $12.50 area, start looking for profit-taking at that point. We are anticipating a move back up to the 50 day moving average. 12/1 It formed a Bearish Harami. The uptrend hasn't changed and the stochastics are still low but if it opens lower on Tuesday, close out the position and don't buy it again unless it comes up through Monday's high of $13.35. 12/2 It closed right on the T-line. Give it one more day. We would not have been eager to sell this with the market trading up. It's just consolidating a little. However, it needs to open higher and start trading higher on Wednesday. If it opens lower and starts trading below the T-line, you will probably want to take profits. 12/3 It continues to trade above the T-line. Continue to hold. 12/4 It maintained the status quo. Continue to hold. This one could still pop to the upside. We don't want to see it close below Thursday's low of $11.63 at the T-line. 12/5 This was out of the limelight, even though it was up 40% on Friday, because of the performance of HIG, which was up 100%. Continue to hold. We're still looking for the 50 day moving average to be a viable target. 12/8 It had a big move on Friday. On Monday it traded up close to the 50 day moving average and backed off. We would have taken profits on half the position. This may consolidate and head back up. You can always buy it back. If it opens lower on Tuesday, take off half the position. As long as it stays above the T-line, hold on to the other half of the position. 12/9 It traded positive most of the day but then turned negative. If you still have half the position after taking profits on the other half, close out the position on Wednesday if it opens lower and wait for it to bounce off the T-line. 12/10 It's starting to set up. If you've taken profits on half the position, be ready to buy back that half position if it comes back up through Wednesday's high of $17.52. 12/11 It held up reasonably well. Be ready to buy back the other half of this position that was sold earlier on any positive trading from here. 12/12 Be ready to buy this one on a positive open. It supported right on the T-line. 12/15 It closed right on the T-line. Close it out on Tuesday if it opens lower. It needs to open higher and trade positive on Tuesday. 12/16 Continue to hold. Be ready to buy this aggressively on a positive open. It would be breaking out through the 50 day moving average. Notice how the T-line has acted as support. 12/17 It's been bobbing in a sideways motion but closed just above the 50 day moving average. If it opens higher on Thursday, start buying it aggressively. Use a close below the T-line as your stop. 12/18 It needs to open higher and trade higher on Friday. Continue to hold as long as it stays above the T-line. 12/19 It's still showing a nice, positive pattern. It's staying above the T-line. Continue to hold. 12/22 It was closed out on Monday as it closed below the T-line, but it was closed out on the way down. Notice how it formed a Doji and a Hanging Man signal with the stochastics at the top end of the range, and then started selling off again. That's the time to start taking profits. This one is now closed out completely.

11/21 Shorted IVC on the weak trading. Stay short and use any trading above $15.76 as your stop. 11/24 It continued to go lower on Monday even with the strength of the market. Continue to stay short. Use a close above Monday's open at $15 as your stop. 11/25 Stay short. However, it formed a Bullish Harami on Tuesday which means if it opens higher on Wednesday, close it out immediately. It needs to open relatively flat and continue to trade down. 11/26 It was closed out as it traded higher on Friday after the Morning Star signal.

11/26 Bought BGC on the positive open. It's still continuing higher. We're looking for it to move up to the 50 day moving average. 12/1 When you see a stock close at a major moving average, in this case the 34 day moving average, half the profits should have been taken as it moved down through Friday's open. The other half should have been closed out as it closed below the T-line.

11/25 Bought BAC as it traded higher on Tuesday. It opened, traded down and then back up, but pretty much stayed above the T-line so we decided to get into the position. Continue to hold as long as it closes above the T-line. 11/26 It's still moving up nicely. Continue to hold. We don't want to see it close back below Friday's low of $15.41. Use that as your stop. 12/1 It was in an uptrend but opened lower and closed below the T-line. This should have been closed out.

11/24 Bought LRCX immediately on the positive open on Monday. It used the T-line as support and continued to move higher. Continue to hold. We don't want to see it close back below Monday's open of $18.08. 11/25 It consolidated a little bit but the upward trajectory didn't change. We expected some profit-taking after it moved up a hefty 25%. Continue to hold as long as it closes above the T-line. 11/26 It consolidated. We don't want to see it close below Friday's low of $19.90. It needs to open and trade higher. If it closes below $19.90, close out the position and wait for the next buy signal. 12/1 It showed weakness as it hit the 34 day moving average. It could have been closed out on Monday as it opened weaker and definitely should have been closed out on the close. It can be bought on the next buy signal.

11/20 Bought ACM on Thursday as it traded positive, but it closed back down. It can still be held as long as it doesn't close below the 50 day moving average. It's holding up well in a very poor market. It needs to open higher and trade higher on Friday to continue to hold. 11/21 It backed off right to the T-line and the 50 day moving average but closed at the top end of the trading range. It's still an uptrend. Continue to hold. Use a close below the T-line as your stop. 11/24 It moved up nicely coming out of the Fry Pan Bottom pattern. Continue to hold. Our target is the 200 day moving average. 11/25 It has now hit the first target and hasn't shown a sell signal yet. Continue to hold. This is a nice Fry Pan Bottom breakout. 11/26 This would have been a good place to take half the position off. Sell the rest of the position if it comes back down through Friday's low of $25.83. That would tell us the 200 day moving average is acting as resistance. It may only come back down to the T-line but it would still be time to take profits. 12/1 It was a good time to take profits as it opened weaker on Monday and you definitely should have been out of it when it closed on the T-line.

11/13 Bought OPTR. It opened lower and then came up through our buy point, which was the halfway point of the previous day's close. It had a very nice move and was up about 12% on the day. Any time you see a big gap up, a pullback, and then a bullish signal, start buying on the confirmation of that signal. 11/17 It's still in an uptrend. Continue to hold. This is coming off a very big gap up followed by consolidation, which eventually told us the profit-taking was over, and then started back up again. 11/18 It consolidated a little bit on Tuesday but still traded positive by the end of the day. Continue to hold. At this point use the halfway point of Friday's candle at around the $7.80 level as your stop. 11/19 It backed off a little bit on Wednesday. It may be consolidating because the selling wasn't significant. Use Wednesday's low of $8.09 as your stop.  If it continues down below that level, close out the position immediately. 11/20 It consolidated but came back up above the T-line. Continue to hold as long as it doesn't close back below the T-line. 11/21 It closed above the T-line. Continue to hold. It needs to open higher and trade higher on Monday to continue to stay in this one. 11/24 It stayed above the T-line. It can be bought again on a positive open on Tuesday. 11/25 It barely closed above the T-line on Tuesday. Continue to hold but if it closes below the T-line, close it out. It needs to open higher and start trading up to continue to hold. 11/26 It stayed up above the T-line. Continue to hold. It can be bought aggressively if it opens higher on Monday. 12/1 It was closed out on Monday as it closed below the T-line.

11/21 INWK was not bought but be a buyer on any trading above $5.80.

11/24 ZUMZ was not bought because it opened and immediately traded down. However, it closed at the top end of the trading range which means you can start buying it immediately if it opens up higher on Tuesday.

11/20 Shorted ACIW on the gap down open on Thursday, which took it down below the 50 day moving average and the T-line once more. Continue to stay short. This has the possibility of coming all the way back down to the $9.00 range, but even if it comes down into the $11 to $12 area, it will have a good profit. 11/21 It was on its way down nicely but then can back up and formed a Hammer type signal on Friday. The decision is very simple. If it opens positive and starts trading up through the 50 day moving average at approximately the $14.50 level, close out the position. It needs to open lower and start trading down to continue to hold the short position. 11/24 It was closed out on the positive open on Monday.

11/18 Shorted VMI on the weakness on Tuesday. It traded lower but came back up and closed positive. It's forming a Doji below the T-line. However, if it opens positive and starts trading positive, close out the position. 11/19 It broke down nicely and moved lower like we thought it would back to the recent lows. If it breaks below this level, it could go much lower. Continue to stay short. We don't want to see it close back up above the $45 area, which would be the halfway point of Wednesday's candle. 11/20 It continued to go lower. It has now breached the little hump area on the chart. He should head down farther. Continue to hold. 11/21 It didn't do a reversal but it came back up, so if it opens positive on Monday close out the position and wait for the next sell signal if there is one. 11/24 It was closed out immediately on the positive open on Monday.

11/17 Shorted TUP on the weakness on Monday. Any time you see a potential reversal signal that fails the next day, it tells you the trend that was in progress is still in progress. Continue to stay short. If it breaks down through the recent lows, it should move much farther to the downside. 11/18 Continue to stay short. At this point we don't want to see it trade at all above Tuesday's high of $19.58. If it comes back up through that level, it tells us we're getting too close to the bottom and the Bulls are starting to step in. 11/19 It continued down. It's getting into the oversold area but continue to hold this until you see a buy signal and a confirmation. Continue to stay short. 11/20 Continue to stay short. It's losing a lot of ground fast. It has now broken out of the range of its bearish J-Hook pattern. It should still head lower even though the stochastics are getting into the oversold area. 11/21 It formed a Hammer/Doji. This is very simple. If it trades above $16.20, close out the position. That would show it's coming up through the T-line in the oversold area after a Doji at the bottom. 11/24 It was closed out immediately on the positive open on Monday.

11/12 Shorted BAP on Wednesday as it opened down below the T-line. It used the T-line as resistance. It can still be shorted on weakness on Thursday. The little Doji type day tells us that if it opens weaker on Thursday, it could move much lower. We don't want to see it close above the T-line around Wednesday's high of $41.64. 11/13 This can be re-shorted on a weaker open on Monday. 11/17 This could have been shorted again. The bullish signal on Thursday failed on Friday, meaning that the downtrend we first identified was still in progress. It could move all the way back down to the recent lows to test them, which would be a 20% move. If it breaks through there, it could move much farther to the downside. 11/18 It formed a Bullish Engulfing signal. However, the stochastics are still heading down. If this opens higher and starts trading higher, especially if it comes up through the T-line at the $40.70 level, close it out. It needs to stay relatively flat and start trading down before the end of the day. 11/19 It's still showing weakness. Continue to stay short. It probably has more downside potential before it gets into the oversold area. At this point we don't want to see it close back up above Wednesday's high of $40.20, which would take it up above the T-line. 11/20 You can continue to short this with the possibility of it coming all the way back down to test the recent low levels at the $30 area. 11/21 It should be closed out immediately if it opens up above the T-line on Monday. It needs to open lower and trade lower to stay in the short position. 11/24 It was closed out on the positive open on Monday.

11/12 Shorted CEDC immediately on the open after the gap down well below the T-line. Continue to stay short. It should come back and test the recent lows and could possibly be forming a J-Hook pattern to the downside which could take it down a lot farther. 11/13 This can be re-shorted on a weaker open on Monday. The downtrend should still be in progress but you can definitely short it again if the markets are weak on Monday morning. 11/17 Even though it traded up on Monday it still did not change the downward trajectory. It still needs to show weakness. Use a close above the T-line at around the $25.80 level as your stop. 11/18 It traded lower but formed a Hammer type signal. Continue to stay short but if it closes above Tuesday's high of $23.19, close out the position. We'd like to see it open lower on Wednesday and continue to trade down. The stochastics are not quite in the oversold area. Just watch it. If it opens higher and starts trading higher, it could pop back up to the T-line so traders might want to come out of it on a positive open. 11/19 It continued to move lower. Stay short until you see a buy signal that is confirmed. 11/20 It's heading toward the recent lows. Continue to stay short. 11/21 It closed right on the T-line. It traded up but closed lower than where it opened. If it trades up above Friday's high of $20.38, close out the position. That tells us the Bulls are still there. 11/24 It was closed out on the positive open on Monday.

11/25 MTL was not bought because it started trading off as soon is it opened. Continue to watch this. If it forms another strong bullish channel in the next day or so, you can buy it.

11/12 OPTR was not bought. It didn't open higher and confirm. You should still watch it because there was obvious profit-taking going on and the company did get approved for a phase 3 project. Watch for the next confirmed buy signal to come back into this one.


 

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