My First Trade Today! Urhhhhh!-what do you think?

[Gardan]

After visiting the T2W education section for newbies I noticed an example stock called Anglo American (AAL) which was trending quite nicely in January 04. As it happened it dropped,but so did every other stock.
After checking the stock yestersday it seems it is trending again?
Here is my trade and thoughts:
I expect it to bounce off it's support line at 12.62 (I purchased it today @ 12.74) and my target price is 13.54 within 3-4 days.
What do you think? any help or comments would be greatly appreciated.
Can anyone explain about volumes and how to read them?

Thanks

 

[barjon]

Gardan

Welcome to T2W. Hope you're not after a comfort blanket It's your own interpretations and learning from them that count in the long run.

For what it's worth I'm long in aal at the moment (since blue circle). Don't have a specific target in mind but will watch what happens at around 1287 and then 1367 or go if it breaks the trendline before (or after!!) that.

You didn't mention a stop loss - hope you've got one.

For some volume discussion try http://www.trade2win.com/boards/showthread.php?t=7751or http://www.trade2win.com/boards/showthread.php?t=11104

good trading

 

[Gardan]

Thanks for the help

Thanks, yes you are right I was after a comfort blanket! and your reply did help. Re the stoploss,I have only placed a small trade to see if my ideas work and hope to see what stoploss I should of placed if I had committed to the trade in earnest. My Plan is to trade for quite a few months like this with small amounts of cash to keep me interested and to focus me more. What stoploss would of you applied to this share? Do you purchase the share as I have done or "spred bet" on it? How's your golf swing? Do you never aim for a target price or do you just move your stoploss up if the share is rising?Thanks Again

 

[barjon]

gardan

You'll find quite a lot on stop losses on T2W if you search - there are many different views.

For me, I decide on the basis of why I entered and when I will think it's "gone wrong". eg: if I enter because it looks as though support has held then I'll put a stop loss just below that support (bearing in mind that "just below" is variable depending on the volatility of the share etc etc). If I enter because the high of a swing low bar (or what I think is a swing low bar ) is exceeded then it will be below the low of that swing low bar. If it's because a trend line has held, then it's under the trend line. And so on.

I don't have a "target" as such but I do look for the next likely resistance level and base my reward/risk assessment on that. I move stop loss to break even pretty quickly, then to the next support level when it appears and/or in tune with the trend line (often split position and do both).

The golf swing has the advantage of always setting the ball off forwards (well, most of the time!!!) so it's only a question of how much is gained. Wish trading was the same.

Hope this helps, but do remember this is only what I do and what happens to suit me. There are plenty who wouldn't agree.

jon

 

[Gardan]

Thanks Jon, I do intend as part of my apprenticeship to listen to everyone and then blame my mistakes/rewards on my own decisions, I do appreciate your views. I am also looking at Xstrata (XTA) but I think I may be a little late! do you have any views on this share?
Re Golf swing, mine much the same with a shape similar to a share price!
I notice you use sharescope. I am using trial version of Updata which I tried a few years ago but my business commitments over- took looking at shares. I am considering buying it again now I have more time. Any Thoughts? Gary

 

[trouble]

I am short of xta as of today @ 843 might reach 859 top but only looking to scalp 10 to 20 points on this stock

 

[Gardan]

Thanks Trouble, Intresting to see you are shorting xta, I am looking at more medium and longer trades at the moment before I start shorting.Not sure if this is right but trying to take one step at a time for now.

Thanks Gary

 

[trouble]

gary

My weekly charts on AAL are showing they might have peeked now and stock is waiting to turn down (i could be wrong though !! )

 

[Gardan]

Hi trouble, your thoughts on AAL are very interesting,I am just learning how to read charts and my view (which I going to assume is always wrong for the next few months) is that it has bounced off a new support line @1254 and should now rise up towards 1350. It would be great to hear your contrary views and how you made them.

Thanks Again Gary

 

[trouble]

Gary

I normally look @ intraday graphs ie 1 min 15min and 60min time frames to actually place a trade but the daily and weekly time frames to confim a trend

daily and weekly time frames seems to have peaked @ the moment hence i would be looking to short this
i spotted xta (same sector) which was showing the same pattern to me hence i am short . In slight profit @ the moment

HOWEVER aal if it breaks 1288 can go back to 1425 (a double top )

 

[Gardan]

Thanks trouble, more great stuff to research!

 

[trouble]

gary

Out of xta @ 825
18 points profit

 

[Gardan]

Hi trouble
wow! well done I hope you are out because you now think it's going to bounce up? or are you protecting profits?

Gary

 

[Racer]

Gardan wrote:

I am looking at more medium and longer trades at the moment before I start shorting.

Is that because you think shorting is harder ?

Does it really make any difference which way a stock moves as long as you get the direction right?

 

[Gardan]

Hi Racer, Simple answer is I am only learning so yes, I do think shorting is harder because I do not know anything at all about selling a stock short. That is to say the actual mechanics of selling the stock.I do appreciate that the fundamentals are probably the same but I am at this point a little scared of spread betting ect. I do plan to learn all about shorting at a later date but must admit the learning kerb for basic fundamentals is quite steep at the moment and keeping me very busy.If you have any pointers I would love to here them. Thanks Again

 

[Racer]

One important thing about shorting and trading..
Shares go down a lot faster than they go up!
So you should really learn about shorting, it is an important tool for trading not only in being able to profit from falling markets/shares but also to keep your brain balanced!
You can look at a trade from both aspects.. as a shorter and also as an investor (whether on a daily or much longer basis)
I regularly trade certain shares long and short .. depends which day it is whether I am long or short! I don't day trade though, unless something seems like a daytrade.

You can short by spreadbetting or CFDs. Spreadbetting involves a bigger spread, but it is really just the same as buying or selling a share just you don't pay any charges.. so that is really the spread. It does move a bit differently to the underlying share though. CFDs are something to think about at a later stage .
Have a look at the various threads on T2W about them both.

 

[trouble]

Gary

With stocks (I don't know why ) 70 to 80 % of my trades are shorts
even in this stupid temporary bull phase we have had over the last year
If i see a stock rising i generally TRY and work out resistance before i go ahead and sell it
I just seem to be happier shorting a stck then buying it. Also the fact that my broker pays me intrest for a stock where i am short rather tham me paying them intrest when i go long on it

 

[Gardan]

Racer, Thanks again, have ordered 1/2 a book store on spread betting/cfds and will spend the rest of the week trawling T2w on the matter. I particulary like the idea (if I understand it correctly) that if I think the share is going to go up-then flip it-and see if it looks better going short.Then see if it looks so attractive-Is this correct? With out reccomending any spread betting /CFds companies would it be possible for you to mention one to do some research on?
Also you don't do any training day's on-site for nusiance newbies do you?

 

[Gardan]

trouble, both you and Racer have given some great advice and I will now to some homework on it.
what part of the country do you live?

Gary