November 30, 2010

I bought an options contract on Citigroup (C) today. I'm still trying to figure out options. They say the more you do them the more you'll understand them. I only bought two call contracts for $0.39 at the $4.00 strike price in March of 2011. So $4.39 is my break even point. It appears to be bouncing off its 50 day SMA. If anyone knows options and wants to put their two cents in on this transaction, feel free.

Also, I may sell INTC in my other account today to buy something else. I'll update if I do.



I sold INTC in my other account for $21.11 and a near 7% gain. I bought the GLD at $135.63.

If Apple doesn't start to take off, I'm gonna sell half my Apple shares and buy Amazon with it. I wish I would have done that when Amazon was bouncing off its 50 day SMA two weeks ago. It's up about 10% since then. Now I have to wait for it to come back down.

After yesterday the scoreboard reads:

Me 17.96%
S&P 6.52%

November 24, 2010

I thought today would be a good day to go back and review the worst trade I ever made. The chart above represents where I bought (8/2) and sold (8/25) ISSI back in August.

Looking back, I sort of understand why I bought where I did. It had broken through resistance a little bit and I was probably hoping that as quickly as it dropped two days before that it would go back up just as fast. However, when a stock breaks through resistance I'm definitely going to wait and see if it has a role reversal where resistance becomes support. Below is an example of this with NFLX. The horizontal line shows the role reversal. The left arrow is where it breaks through resistance. The right arrow is the entry point.




The horrible mistake I made is not selling when it dropped below the 20 and 50 day SMAs. If I buy a stock because I think it's bouncing off of a moving average, I need to sell that stock if it drops below it. I can remember when it punged below the 200 day SMA talking to the chart on Power Etrade Pro saying "Bounce !&#%@ Bounce! If you ever find yourself saying that, you needed to sell that stock a long time ago. Lesson learned.

The market is up today as I'm writing this, but the SPY seems to have hit resistance right at its 20 day SMA. Hopefully it can break through and coninue on through that $122.00 level of resistance that it hit a couple of weeks ago.

INTC is also coming up on resistance at $21.80. It's at $21.41 as I'm writing this. It hit resistance at $21.81 on November 12, came back down to bounce off its 20 day SMA, and hopefully can break through this time. The chart is below.





An update on my investments. Return is as I'm writing this.

Other account:
Chipotle: 45.33% since 09/24/10. Shares bought at $169.65 now around $248.00
Intel: 8.02% since 10/20/10. Shares bought at $19.73 now around $21.41

Scoreboard account:
Apple: 2.65% since 10/28/10. Shares bought at $306.42 now around $315.00
Netflix: 6.17% since 11/10/10. Shares bought at $176.02 now around $187.40
BFR: -5.5% since 11/11/10. Shares bought at $12.65 now around $12.03.

After yesterday the scoreboard reads:

Me 14.03%
S&P 5.89%

Have a good Thanksgiving.

After writing this entry, I decided to sell BFR at that 5.5% loss. I then added some more money to my account so I could buy Ford (F) at $15.87. It seems to have found support on its 20 day SMA. Normally I would wait for a bigger green candle, but I'm willing to risk getting in a little early. Here's the chart I was looking at.


Apple is about 40% of my account, Netflix and Ford each about 30%.

November 16, 2010

Today there is cause for concern. I was hopeful after the S&P closed just above its 20 day SMA yesterday that it would bounce today. Instead it has plunged below. Hopefully the buyers will move in as it nears its 50 day SMA. If not, we might be in for the double dip that some people fear.

As you can see from the chart above the last time the SPY hit resistance at $122.00 on April 26, it dropped 17% over the next 2 months until it finally found support on July 1 at $101.13 . On November 9, it reached a high of $122.95 followed by 6 consecutive down days and is currently trading around $118. So from April 26 to today the S&P is down 3%.



I will now compare those highs and lows of the S&P with Apple and Netflix. Above is the chart for Apple. On April 26 it hit a high of $272.46. On July 1 it hit a low of $243.22. On November 9 it hit a new high of $321.30 followed by 6 down days to around $302. If you were in Apple since April 26, you would be up about 10%.




Above is the chart for NFLX. On April 26 it hit a high of $109.70. On July 1 it was hit $103.27, but it's low point came after an earnings announcement on July 29 at $95.33. On November 9 it hit $174.90 and is now trading around $164. If you were in Netflix since April 26 you would be up 45%.

So what is the play here? I guess I'll wait and see if the SPY, NFLX, and AAPL bounce off their 50 day SMA. If they don't, I'll probably keep NFLX and start shorting the S&P by buying the SDS. We'll see.

After yesterday the scoreboard reads:

Me 10.59%
S&P 7.41%

November 11, 2010

I bought BFR today at $12.65 right after the market opened. Hopefully I won't have to post for a while as I plan on keeping these stocks for a while. After yesterday's trade the scoreboard reads:

Me 15.68%
S&P 9.29%

November 10, 2010

I sold ISLN today at $26.39 and a 6% loss. It was still above it's 50 day SMA and actually resting right on the support trendline. I'm sure that it'll bounce tomorrow since I'm selling it. I'm doing this because I really want to be in Netflix (NFLX) and now is a good time to get in. It had a big green candle today and appears to be bouncing off it's 20 day SMA. I bought shares at $176.02 and plan on keeping them as long as it keeps bouncing off it's 20 day SMA. The chart is above.

I added some money to my account so that I could buy BFR today, but couldn't get the order in before the market closed. It closed at $12.60 and is bouncing off it's 20 day SMA with a big green candle.

I'm now happy with the four stocks that I own on Etrade. Apple and Netflix in the account I'm keeping score on. Chipotle and Intel in my other one. Here's my return on those other three stocks as of today.

Apple: 3.6% since 10/28/10. Shares bought at $306.42 now around $318.00
Chipotle: 38% since 09/24/10. Shares bought at $169.65 now around $235.50
Intel: 6% since 10/20/10. Shares bought at $19.73 now around $21.00

I'll update the scoreboard tomorrow.

November 8, 2010

Me 18.02%
S&P 9.93%

November 5, 2010

I sold SUP today for $17.79 and a 3% loss on about 35% of my account. They announced earnings today which caused a big red candle and also me exitting this trade. I then bought ISLN for $27.98. It's bouncing off its 50 day SMA with a big green candle as shown above.

I'll update the scoreboard tomorrow.

November 2, 2010

I bought SUP today at $18.37 about 45 minutes before market close. It appears to be bouncing off of its 20 day SMA. The chart above shows what I was looking at.

After yesterday's trade the scoreboard reads:

Me 17.13%
S&P 6.21%

November 1, 2010

I sold TGH at $25.98 today for a gain of over 5%. I put in a 1% trailing stop order and it got triggered. I may buy something at market close. I'll update the scoreboard tomorrow.