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Underexposed - Canadian Stock Journal


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Underexposed - Canadian Stock Journal

  #491 (permalink)
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Silver Dragon View Post
@bobwest,

Price action trading also depends on perspective. I marked up your chart with what I saw. As you can see I have many more false positives. You are correct; knowing what lines to draw and where to draw them is the hardest part. By far, your chart is how is how it should have been traded.

It should be noted that Price Action always looks easy to trade in hindsight, however, trading the far right edge in real time is a very different story.

Robert

Sure, I agree with everything you said. Everything is easy in hindsight, after all, and this is actually not so easy to do in real time. People do start out with high hopes, and then find things are not all that easy. (And not just with this method, either.)

I put up the chart only to show what "price action," as a trading method, is all about, in a general way. My little post is not meant to either be a detailed exposition of the method, nor the "right way" to do it, nor a recommendation, one way or the other.

There are people who are very good at this stuff. There are people who are less so, as with everything else. I certainly am not an expert, nor is it really my thing. I have tried to learn something from it, and it can be useful. In fact, the chart I posted is one I currently maintain, along with others. I use it for perspective and, no, the lines I draw are not always that perfect until afterwards. But again, my point was simply to show what it is.

No endorsement, no criticism either.

Bob.

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  #492 (permalink)
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Underexposed View Post
you did not lose the chart

I do this type of charting sometimes and it is very valid as I see it. I have used it myself on occasion especially when discussing Gold eod prices as can be seen in this discussion I did

https://futures.io/stocks-etfs-trading/14652-precious-metals-stocks-etfs-12.html#post429429

what puzzles me most of price action charts is that most users restrict themselves to horizontal resistance/support lines when there are equally valid diagonal ones and they use only channels not wedges or triangles. Then of course you throw in "ticks" and the wheels fall off for me.

I still remember early in my posting here criticizing a chart for having an inconsistent x-axis and being told it was a "tick chart".... still don't like how indicators designed for normal time charts, are casually used in tick charts...makes little sense to me.

I use this "price action" but usually in the P&F charts that I use in a complete analysis.

That's funny, I don't think I ever, or hardly ever, see a price action chart on futures.io (formerly BMT) that only has horizontal s/r lines.... I do read a lot of the threads in the Elite section (I read and post in both), so we may not be seeing the same things....

I do see more channels than wedges and such. One of the people who have helped popularize price action, by the name of Mack, and who has inspired a lot of posters here, uses mainly channels. Not horizontal ones, though. Regular trendlines. What I drew on my chart could have been posted on any number of threads, or by Mack for that matter.

Brooks has said that a "channel" doesn't have to only have parallel lines, and cheerfully draws them however they connect up. He's also very keen on wedges, flags, and all the other "classical" (non-indicator) charting formations.

I have noticed that you use P&F charts sometimes, a definite and welcome blast from the past for me, which I also agree can be very useful. It's the same mindset.

Anyway, all that was just to show simply what "price action" is.

Sometime or another we will have to re-visit the tick chart thing. Not today, though.

Bob.

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  #493 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014


well that is it for me this afternoon. Markets are almost closed and I will post a small loss for the week so far but the week is not over and my streak of positive weekly gains may not be over yet.... or it could be worse

I will post the status in this evening.


I enjoyed the conversation and examples shown this morning...it keeps me sharp and looking at things I don't think about often.

To my American friends....Happy Thanksgiving and Good Friday... may it go well.

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  #494 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014

mid-week status Nov 26/14

here is the status after 3 days this week




It has been a pretty good run for the past 6 weeks and so far it does not look like it will continue. In Canada we are not in the Holiday situation as they are in the USA .... Our markets will be open.

The stocks of concern for the last week or so has been Badger Daylighting [TSX:BAD] and Lundin Mining [TSX:LUN].

I view Badger as a long term hold which is the reason why I have no limit Stop Loss on it. Lundin Mining [TSX:LUN] on the other hand I view as a swing trade which last week was on the verge of going real bad but after placing a Limit Stop-loss on it and trailing it behind, it has performed quite well. I raise the Limit stop Twice to $5.65 -$5.67.

let us look at the charts as they stand after today.

Badger Daylighting

Here is the trigger chart





My suspicions that the run was over a couple of days ago have proven true. Now it is in consolidation and I have pointed out several times it is reaching for the 20 daysma... from the looks of things there is another $1 worth of loss expected.... but that does not bother me with this stock as I believe in the stock and its drop has more to do with the Canadian market conditions, falling oil price (it is a service industry to Oil) and not to anything bad that it is doing to my knowledge. I don't really expect a recovery for about 5-10 days.

The MACD/Slo Sto and BBwidth all give a sign as to the end.... I would like the Slow Sto to stay above 50 though





This chart is showing something I have not seen before and I circled it. The ichimoku looks fine as far as the clouds are concerned...unless the stock plummets we will not hit a cloud....but look at the thin blue/red lines. The share price HAS had a decent drop .... a bearish drop... but instead of the red line reaching for the blue and trying to make a bearish cross.... the red line is dead-assed flat along the border of that red cloud while the blue is racing for the sky. I truly don't know what to make of it other than to think of it as a positive sign.

the other two indicators are mildly bearish but not serious at this point


Lundin Mining





this looks like my raise of the limit stop loss might have been a tiny bit premature But it is done and if there is a downward spike the order could be tripped....

Actually the chart looks better than the one for Badger. there is no sing of an upward curl to the lower BB and the MACD and BBwidth charts show a staggered but positive slope.... the Slo Sto is nicely over 80





This is a much better Ichimoku chart than that for Badger...we have recently cleared the red cloud and the thin blue/red lines are appropriately bullish as well as the indicators below.

Perhaps it will surge tomorrow and continue... when I raised the limit I stated I would raise it again if we closed over $5.90....fingers crossed it will do it tomorrow...or at least pull away from the abyss...if it does not I will have made almost $1000 and I will have to decide what to do with the total money then available

so.... hunker down with Badger....cross fingers for a rise in price on Lundin and no tripping of the stop-loss.

A nice run...not necessarily over yet this week.

Good Trading tomorrow.......

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  #495 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014

It is rough in the markets.... especially the Canadian markets which are commodity driven... with the OPEC oil decision to not cut production.

Lundin Mining opened at about $5.50/ share today.... so many might feel my Limit stop-loss would have tripped today. But not so



The red line in the upper left chart shows the previous day's close so we plummeted right through my position. If it was a normal Stop-loss My order would have been filled somewhere less than $5.60 and I would have no control.

My order is still valid between a range of $5.65-$5.67 if it rises there today..... I will leave it for now to see what happens .... I may cancel it and sell at some point, or cancel it all together .... it all depends on how things work out. Suffice it to say I will have a pretty big negative for this week {sigh}


Last edited by Underexposed; November 28th, 2014 at 01:33 PM.
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  #496 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014

Lundin Mining

I am canceling the Limit Stop-Loss order for Lundin Mines effective now 11:39am MST





As can be seen in this chart confirming what I posted earlier.... the price opened far below the limit range of $5.65 -$5.67 that I had set for the sale of the stock. There was no reason for this plummet attributable to Lundin Mines itself. In fact this last bit of news I can find is rather good

Stock Market Quotes | Stock Market Quotes and Symbols

It shows production numbers for a new Nickel/Copper mine in Michigan meeting or exceeding their targets for the past 2 months since it opened.

This last drop for everything is oil related and nervous investors.... nothing top do with mining... in fact if anything it would lower their fuel costs in production... a benefit.

This is why I prefer Limit Stop-Loss over simple Stop-loss.... It gives the control to me if I don't get my target.

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  #497 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014

End of Week Status Nov 28/14

I suppose my recent actions look weird to many day traders. It looks like I am ignoring profits, perhaps not following the stocks close enough to make good choices. They may also feel that TA failed in its ability to anticipate these sudden reversals. Well, no one can predict such reversals with any accuracy...TA follows patterns and what happened yesterday and today was not a foreseeable pattern.

OPEC (rather Saudi Arabia) decided NOT to cut production of oil in order to raise the price of oil. As a result, of this decision the price of oil plummeted on the futures market and nervous investors created a run on many stocks.

The decision might have gone the other way too, no one was certain what would happen.... if Saudi Arabia (through OPEC) decided to cut production there would probably been a huge bullish response....

TA cannot accommodate either scenario... so to my way of thinking you just ride out the result.... nothing more to do.... if you panic you lose real money....not have paper losses if you sell.

Ironically, Badger Daylighting [TSX:BAD] actually after a fall today in early trading, gained on their last closing... and they are an oil patch service company.

Lundin Mining [TSX:LUN] fell hard and did not recover much.... and they have nothing to do with the O&G sector as they mine Nickel, Lead, Zinc and Copper...Base metals... it had decent production news....I pulled the plug on the failed Limit Stop-loss order after it failed to trigger since the stock opened far below the limit price range....Why??? because I fully expect it to rise back to those previous levels, recovering those losses.

To those that say "Why not sell and rebuy at the lower price???" Long term traders don't do that, we don't try to squeeze blood from a stone. When the future looks bleak for a real reason, I will pull the plug. However, I do not respond to the panic of a nervous investing climate.... That is how I survived 2008 - 2009... back then nothing made sense to me....I had enough money set aside to ride out the downturn.... and I did...taking massive paper losses during that period but gaining most of them back in the years following when the stocks rebounded.

This week was a rough week totally....I sort of expected it coming as I had 6 great +ve weeks prior to that. It could not be positive forever as much as I would have liked it. I am still in great shape to have a decent 12 months with 2.5 months to go til I will have had this fantasy portfolio for a year (having started it on Feb 14/14)

Anyway here is the status of this end of week



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  #498 (permalink)
Calgary Alberta/Canada
 
 
Posts: 934 since Feb 2014

mid week status Dec 5/14

Well as you can see I have not been too active on the site for this week.

I have been rehearsing for a three performance Christmas concert coming up on Sunday (two performances) and Monday evening .... Sunday matinee is sold out, the evening performance is 80% sold out and the Monday is 50% full. We added a third performance as an experiment as we were (and would be today) turning away patrons when 2 performances sold out and we cannot get a larger venue with the acoustics we have in the current facility (a church with a huge stage and a 500 seat sanctuary.

So it is a big deal for us and we are going to raise the roof on that church .... no this is a recreational choir not a church choir.... of 65 women and 25 men give or take a couple on a given day.

Last week was terrible with the Oil announcement by the Saudi's that they were not cutting production and the drop in the price of oil continues...who would have guessed oil would be in the $67/barrel range today??? One wonders if this is a geopolitical move to starve out the Russians as the drop in price must be hurting them big time??

The week started bad but the last 2 days we have recovered most of those losses.

here is the status as of the close of the day today





What about Lundin Mining???





Here is the chart and as you can see it is in consolidation... The price has fallen to the 20daySMA as I expected and now hopefully it goes sideways until the BBwidth gets to its trigger level.... the Slow Sto and MACD are falling and were that to continue and the BBwidth reverses direction...well down we go again .... the Slow Sto is hesitating at 50 and MACD drop is slowing down ... that 50daySMA may be helping us.

Gold????





Actually this is looking promising...but I would wait til I see a real breakout before going back into gold mining stocks...tired of being jilted.

Conclusion

As you can see I am quite busy to think of developing a new thread in this journal for now.... but I will answer questions as best I can if any of you have any... it is nice to see a continued readership and I thank you.

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  #499 (permalink)
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yea, i thought gold was going back down for sure, and looks like MACD turned back up. it's strange since the dollar is continuing to rally.

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  #500 (permalink)
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jackbravo View Post
yea, i thought gold was going back down for sure, and looks like MACD turned back up. it's strange since the dollar is continuing to rally.

yes, that certainly looks good but the only thing bothering me is the weak Slow Sto.... it is hanging around 50 and it is usually the leader in a breakout.

here are other charts to develop the consensus of indicators that I usually use to see if there will be something happening.

P&F Chart





You can see we are butting up against not one but two resistances.... a diagonal one AND a horizontal one. The diagonal one is weak but the horizontal is stronger...the two together are additive.

Sentiment chart





here the messages are mixed

The CMF is in the green and bullish though it only MILDLY bullish as the price is not responding with the same vigour as the CMF

The RSI is neutral only ... see how it is flattening out at 50

The DI+/DI- is still bearish but there is some hope the two will reach for eachother


Ichimoku chart





This is another mixed message chart

the price is still under those red clouds and they are significant resistance...both borders and the glue in between. the thin blue line is still under the thin red line so this is still Bearish but we are approaching those clouds s anything can happen

The onBal vol mildly bullish as it has reversed direction and has a nice pos slope

the CCI is bullish now as it is entering the green


Conclusion

So what is the consensus??

1. P&F show price up against a reasonably strong resistance
2. The trigger chart has the price above the 20daySMA and the indicators suggest a try at a breakout

Kind of a saw off there.

the other indicators are

Bullish........... : 1
Mildly bullish.. : 2
Neutral ......... : 1
Mildly bearish. :
Bearish ......... : 2

cancelling out opposites leaves us ever so slightly on the bullish side of neutral

So entering into gold plays is only a WATCH at this point.... an interesting watch but a watch nonetheless.

See how you use non-conflicting indicators to arrive at a consensus??? individually you could be set astray....


EDIT: It was late when I wrote this.... by "non-conflicting" I really meant indicators that do not give the same look to their charts. For example TRIX and MACD, though calculated differently, give similar charts when MACD is not used with a signal line. So if you used both indicators you would get a false IMHO reinforced signal of the market.


Last edited by Underexposed; December 4th, 2014 at 08:27 AM.
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