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Oct 17

Mid-Week Charts, As Promised

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by Rogue Traderette

It’s amazing what a couple of days can do, isn’t it?  I had loads of stocks come up in my scan this morning – obviously not all of them were ideal for my style of trading but I’ve got a few to share that look the goods.

Due to risk restrictions on my portfolio, I won’t be able to enter all of these unless I can either move some stops up very soon, get stopped out of an existing position, or decide to cut out some dead wood.  Yes, I’m looking at you, $BLW.  ;)

To recap my trading style please check out the beginning of this post.

Please click on charts for better detail.

$CP

$CP has come up in my scans for the last couple of weeks but with that previous spike high I was a little cautious.  However, that’s clearly no longer an issue but you have to bear in mind that this is a weekly chart, and the week is not yet over.  Ideally I’d like to see the week close above the spike high.  However on the daily chart of $CP you can see a clear break out of congestion which gives me more confidence for continued strength.

I’ll be setting my order for $91.90, with a stop at $79.50.

$MAT

I’ve shown you $MAT on a daily chart, because even though it’s $7.00 away from its original break-out, this last gap to a new high is pretty perfect.  You’ll notice that it’s been consolidating since mid-July, and has popped up into a new range in a burst of pent-up energy.  As an added bonus, there was a nice increase in volume to confirm the move.

Because of the tight stop available here, I’m inclined to set my order quite close – around $37.35, with a stop under the range at $34.00.

$WSM

$WSM is another exciting chart.  It’s manged to break through a strong resistance level at around $45, which has been touched four times prior to this move.  On the daily chart you can see a gap through the previous more minor resistance and price really hasn’t looked back from there.

I’ll be looking for entry above yesterdays candle high at $47.99, with a stop around $42.50 under the last swing low visible on the daily chart.

$VR

$VR has had a rather boring existence up until now.  It’s pretty much plodded along at a steady pace its whole life, but around September last year it decided to aim for something rather more exciting – and because a change is as good as a holiday, why not a brand new high?  The interesting thing about this chart is that on the daily you can clearly see it picking up acceleration – and given its new lease on life has propelled it into uncharted territory, I’m interested to see where it goes to from here.

I’ll be putting my order in at $36.50, with a stop around $32.30.

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  • http://www.facebook.com/profile.php?id=688588664 Colin Miller

    Hi Jess. I notice you use very wide stops (to me). I’m curious, do you use a time-limit stop (since it may take many weeks to be stopped out), if so do you find yourself using it often? Also what type of reward do you hope to make for the risk taken, eg do you hope to make in profit say 3 times as much as you are prepared to lose if stopped out? Finally do you use a volatility based trailing stop, or do you look for pivot lows? Thanks for sharing your blog.

    • http://www.roguetraderette.com/ Jessica Peletier

      Hi Colin,
      I do use wide stops, because i hope to be in these trends for a long time. I don’t put a target on it, in a trending environment like the US have now (and have had since 2009) I’m hoping for big wins – 3R, doubling, tripling, whatever the market gives. I use an ATR trailing stop and follow the trend as far as it will take me. I also move my stop up quickly with positive moves, and pyramid in quite aggressively.
      I don’t have a formal TL stop, but if there are lots of opportunity and there’s something i’m holding that isn’t performing, I’ll sell it then to make room for better opportunities.

      • http://www.facebook.com/profile.php?id=688588664 Colin Miller

        Thanks Jess. Yes, I read your previous trading style post AFTER I sent my questions and realised you were going for long term plays…makes perfect sense. Do you have formal rules for pyramiding?

        • http://www.roguetraderette.com/ Jessica Peletier

          I’m still working them out – i tend to go on feel, but need to be more mechanical. I’m deciding whether to a) buy a pullback with a candle reversal, or b) buy a breakout after I’m at breakeven. I quite like both really, depending on the stocks personality.

          • http://www.facebook.com/profile.php?id=688588664 Colin Miller

            I base my trading methodology using Daryl Guppy’s techniques. While I don’t pyramid myself, he uses what he labels a “Grow Up” strategy to pyramid into trades. The strategy is explained in his books “Better Trading” (2001) and “36 Strategies of the Chinese for Financial Traders” (2006) both by Wiley. Thought I would share these titles with you as it may be useful for you to adapt/incorporate it to your personal style. Have a great weekend.