Gianniz's Journal

[Gianniz]

Well, first of all hi to everyone since this is my first post in the forum. My name is Giannis (23) and I am from Greece.

I 've recently invested time into reading trading tips, guides etc. It is all about paper trading till now, and surely I am not yet ready for a real money account.

Anyway, I am mostly analysing charts with basic support/resistance levels. Not messing with indicators yet.

Before you proceed I must note that since I am a complete newbie this is not actually a Journal. It is more like a thread in which I 'll be justifying my picks/thoughts but more importantly I 'll be waiting for the corrections of the more experienced traders.

I still have not decided on what to trade but I 've been mostly messing with US and UK stocks. Being unemployed at the moment (just recently got my degree in finance), I don't have any time constraints and my goal from all this, is just to learn in a way that does not cost me a lot of money. A career in the financial sector is surely something that appeals to me but that's an other discussion.

Finally, I want to say that I am sorry in advance in case such a type of thread is not allowed in the journal section but I could not find a more appropriate place for it.

 

[Gianniz]

So, I am currently trading with the plus500 platform since I 've used it a couble years ago in a course of my univ and so I am kinda familiar with it.
Also, I haven't still got into the process of reading reviews for other software and generaly everything around trading software and trading tools is something I need to look into deeper at some point.
In each trade I am risking 1% of my capital.

 

[Gianniz]

I 've been monitoring various stocks for an opportunity to enter the market.

Long story short, I 'll present to you my thoughts over the HSBC stock in the UK stock exchange since it seems to me like an interesting case.

HSBC - Weekly Chart (going back 4 years)



HSBC - Daily Chart (going back 1 year)




HSBC - 4H Chart (going back 3 months)



My thoughts

We can witness that we got a strong resistance level at the price of 740.00, confirmed in multiple time frames. The stock is about to test this resistance level any time soon. It may not touch it but it is pretty close anyway. My decision will be based on the daily chart.

1st Scenario (Buy) : Resistance level gets broken. I would wait the price to get to 750 and then place my stop loss at 740 and a target price at 790 (below the last resistance level seen at the weekly chart). That gives a satisfying reward/risk of 4/1. I choose 750 as my entering price because I think that in the region of 740-745 there are stop loss orders to be executed. Moreover, I believe that if price reaches 750 then this will be a stronger signal that it is going up.

2nd Scenario (Sell) : Imo it is not necessary to see the stock testing the actual price of 740 to enter short. So in case I see 2-3 consecutive red candles in the daily chart I 'll go short since I'll consider the stock to have confirmed the downtrend shown in the daily graph above. With this in mind my stop loss would be set at 745 and my target would be below the previous bottom, at 660. Supossing the price in this scenario will be around 730 when I enter that gives a reward/risk ratio of about 4,7/1.

As I was writing this the resistance line got broken and today's candle will close above 740. Seems like the 1st scenario is closer.

Share your thoughts/knowledge please. As I said, I am still in the early learning phase and will absorb anything you have to offer like a sponge :cheesy:.

p.s. : Excuse me if my english is not right in some parts.

 

[Gianniz]

HSBC


After today's candle formation I 've decided to enter long. It's not a hammer but still demonstrates that although many people were selling there is power from the buyers who managed to keep the price almost at break even.
It even dropped at 728 from 740 but the fact that it close well above 728 tells me there is significant buy power. The only reason I already entered from today and did not wait for tomorrow's open is that I am hoping for an upwards gap in the price tomorrow. Maybe I am risking a little more and should wait for one more green candle above the 740 resistance level but I think the odds are in my favour.
Stop loss is set at 730 but I 'll be moving at 740 if I am given the chance.

 

[Gianniz]

Price went up today. 743,90.

New stop loss set @ 740,00 which is an important price in this stock as shown above. I 'll be winning even if the stop gets hit but of course I am hoping for the trend to continue.

I am having some thoughts that maybe the stock is entering a wave 2 of stage 2. If that's the case then the stop will be hit and I'll be looking for a new long position later in the week.

 

[barjon]

gianniz

You're running this with a pretty close stop. Bid and ask spread is often wider than normal on the open until things settle down and you won't need much of a move to get caught.

 

[Gianniz]

Hey barjon

Fact is that I didn't rly think of the price volatility on the opening. Thank you for that point. On the other hand I don't want to let my stop @ 730 and see a big red candle touching it. I am kinda afraid of a pullback.
You mentioned ask and bid price. I guess this means that the price does not actually have to touch 740 for my stop to be triggered, right?
Would you add a new stop-loss if you were in that trade or just let it at 730 ?

 

[barjon]

No, you'll be sold out at 740 on the bid when price reaches it. If your broker is quoting a 2 point spread (say) that will be when the mid-price (as your charts) is 741.

ie: bid 740, mid-price 741, ask (offer) 742

Don't forget the mid-price would still be 741 if the bid was 739 and the ask (offer) 743 if the spread is widened.

 

[Gianniz]

Oh I get it now. Nice to know that. Thx.

I am moving my stop at 736,00. Today's lowest was 737,4. Hopefully 736 won't be reached.

 

[Gianniz]

Today's close @ 754,4 of HSBC was good for my long position.
I won't define a target price. I believe that this stock can make a strong run. I 'll be using trailing stop loss untill I am stopped out. The stop loss will always be put below the lowest price of the last 2 days.

In the mean time I went long on Centamin today about 2 hours before the close (already covered the spread loss )



Reasons for my position :

-Nice double bottom = good support level.
-I consider the stock to be in an uptrend.
-That gap was caused because of some bad news on 10/05, in my opinion this is giving me a chance of low risk trade - high reward trade.
-Good swing point formed (low-lower low-higher low).
-RSI formed a higher low (not shown in chart), indicating uptrend.

Against my position is the fact that the price is below the 200 SMA and that the 10SMA has not crossed the 30EMA yet (but seems about to).

Stop loss set @ 35,00

Trade well