How Do You Eat An Elephant?

One Bite at a Time! I know it can be extremely hard sometimes to stay content with small gains, especially when the market is as volatile as it's been the past few months. The tendency to feel like you're a: leaving profits on the table with every trade or b: not being aggressive enough with your account size and/or # of shares, can and will lead to bad trades if you let those 'hindsight' emotions get a hold of you.

If you've been following my blog, you know from my last post that I was extremely bearish after last Monday's 500 pt. Dow run. There are many technical reasons for that (ie. Elliot Wave Theory, market in overbought territory, etc.). There are also plenty of blogs that go into much greater detail in regard to these types of technical analyses and/or fundamentals (ie. Government involvement like the Obama/GM situation, possible war with N. Korea, etc.) I just want to share my thoughts and trade executions as transparently as possible (in true Timmay form). I'll leave the 'professional trader speak' to those more capable.

Having said that, my latest bit of elephant was TCK- a stock that pretty much fit my strategy perfectly (except for the market cap). Props to Investors Live for find. You'll notice (in the chart above) that when TCK reached $6, the RSI (top of chart) read 'overbought', not to mention it had come from the $2 range- where I like these runs to have originated. Below is the chart that helps illustrate my entry/exit:

Did I leave a ton of profits on the table with this trade? Yes. Did I read the technicals right and trade my plan? Yes. I guess tie goes to the runner (with a little extra money for his pants).

On a side note, as you'll see tomorrow on Covestor, my account (at least at this moment) closed at an all-time high since it began being tracked in early '09. If I'm correct, I should be in the rankings somewhere starting tomorrow (my 2 month Covestor anniversary). I believe the 'Pride comes before a fall' Scripture would be appropriate to reflect on at this juncture (No worries Eric and Charlie).

Remembering that the market will humble you at will,

Evan

ps- Yes, I'm still short Maxy and Palm. I'm still long Faz.

pps- I shaved some profits from my last buy of FAZ @ $18ish, and some from my PALM short @ $8.72ish (all this can be found either on my Covestor or twitter pages).

End of Rally?

I don't know. You don't know. I wish I knew. All I can say is- I've prepared for a correction/retracement/dive, etc. Yesterday, at market close (which was perfect timing but only because I had no choice), I sold all of the mutual funds in my 401k and transferred the money into a safer, bond fund. I plan to buy back the exact mix of funds if the DOW dips below 6,500 in the next month. If that doesn't happen- I'm wrong, but 'missed money is still better than lost money'. Also, if we don't correct soon, you can throw RSI's usefullness out the window (cuz we've just entered 'overbought' territory):


As for the Think or Swim account tied to my Covestor ID, I'm also preparing for the end of (imo) the bear market rally. I averaged up my PALM short today, adding 100 shares at 8.81. I'm also long 25 shares of my friend FAZ (avg. about 25.75ish). Forgive me for not updating the avg. prices on the right hand side lately. Knowing that Covestor verifies every trade has made me a bit lazy- I'll try to do better.

In case you're worried that I've stopped posting/trading/reading the Yahoo! Finance boards, etc.- Have no fear! I've been keeping up with all of that and then some. I've decided to build a webpage that focuses on why I trade. Yeah, the 'Mission Trip' part. Mission-trading.com is my new project (like I need one- and be kind, it's not completely finished). The blog you're reading is pretty much 99% about the 'trading' part (and will continue to be so), but fails to expound on the reason I trade. I'm not saying mission-trading.com will be 99% about missions, but it will certainly bring to light the connection between the two passions that drive me.

Hoping the country and my shorts somehow thrive,

Evan