Share Trading Diary

“36 Strategies of the Chinese” Trading Seminar Presented by Daryl Guppy

Sun, 13 May 2007 12:35:19 +0000

Attended the “36 Strategies of the Chinese” trading seminar presented by Daryl Guppy on Saturday May 13 at the Carlton Hotel. This is the first part of three seminars covering the 36 strategies. The next two will be held on the 23 and 24 June 07.

So what strategies were covered in this seminar and how useful are they when it comes to trading in reality? Here is a summary of 5 of the strategies covered:

(more…)

My Worst Trade Ever….To This Date Anyway…

Tue, 08 May 2007 15:56:45 +0000

When you are on a winning streak, sometimes your ego might get to you. Overconfidence, cockiness, complacency…or whatever..sets in. One bad trade is all it takes to bring you back down to earth.

I spotted an ascending triangle pattern forming with China Infrastructure on Friday, 20 Apr 07. The pattern was set nicely for a breakout.The Dow had also rallied on Friday. Surely, this ascending triangle pattern would breakout when market reopens on the following Monday.

The Plan was to place a buy stop order at 0.125 for 95,000 shares, with a limit order at 0.13 to make sure I got into the trade when market opens. I was certain that this stock would gap up! Target for this trade was 0.15. Stop loss would be the point of breakout which is 0.12. I stand to win $2,375 while putting at risk $475.

(more…)

Weekly Watchlist (30 Apr - 04 May)

Sun, 29 Apr 2007 14:18:57 +0000

Weekly Watchlist is up. Table is sorted in accordance to Reward Vs Risk, from highest to lowest. Trading opportunities that present themselves range from short term patterns like the ascending triangles and flags, to medium term stirrup patterns. Stocks that made it to this list satisfy my financial objectives which is as follows:

1. Any winning trade should provide me with a potential net profit of at least 3% of total trading capital (3% x $60,000 = $1,800).

2. Any losing trade should reduce capital by less than 1% of total trading capital (1% x $60,000 = $600).

This literally means taking two steps forward (winning trade) and one step back (losing trade) and keeps me in a profitable situation always.

How Are My Flags Doing?!? (The Winners)

Sun, 29 Apr 2007 13:18:07 +0000

Out of 9 flag trades executed within a 3 week period from 4 - 23 Apr 07, only 3 trades managed to cross over the finishing line i.e meet the projected price target. The remaining 6 trades lost their way and yielded in 4 losses, with the other 2 showing a small profit. All losses were contained to within 1% of total trading capital ($60,000). This is a successful damage limitation exercise which eventually allowed the profits of the 3 winners to completely overwhelm the losers.

Adding Design Studio, another successful flag completed in the first week of April, onto the winners podium and the results are even more impressive. This literally puts into practice one of the 36 strategies of the Chinese (covered in Daryl Guppy’s Book of the same name) - “The Plum Dies in Place of the Peach”. The Plum in this case means the losing trades. Cutting losing or non-performing trades fast and without hesitation helped improve overall trading results in the month of April.

(more…)

How Are My Flags Doing?!? (Presenting The Losers)

Sun, 29 Apr 2007 11:14:52 +0000

Unfortunately not all my flag trades went according to plan. In fact only a few made it to their targets. Those flags that lost momentum were cut quickly with no mercy. When trading flags I would expect the breakout to be strong and the excitement should carry prices to its target within 2-3 days. I would be worried if after breakout prices move sideways, and this was what happened with some of my trades. Momentum stalled and the trade(s) had to be closed even at the expense of making a loss!!! All Losses per trade MUST be kept to less than 2% of Total Trading Capital.

China Aviation Oil

Entry Date = 10 Apr 07
Entry Price = 1.53
Position Size = 8,000 shares
Exit Date = 17 Apr 07
Exit Price = 1.53
Loss = $-84.16

Chemoil Energy

Entry Date = 13 Apr 07
Entry Price = USD 0.77
Position Size = 10,000 shares
Exit Date = 19 Apr 07
Exit Price = USD 0.745
Loss = $-535.23

Envirohub

Entry Date = 4 Apr 07
Entry Price = 0.565
Position Size = 22,000 shares
Exit Date = 17 Apr 07
Exit Price = 0.590
Profit = $462.61

(more…)

Watchout…Flag Fest!!! (04 Apr - 16 Apr)

Tue, 17 Apr 2007 10:00:13 +0000

The bulls are back, or should I say, the bulls are RAMPAGING again. And they are armed with FLAGS. These type of trades are too hard to ignore. As of last week, I have gone into snapshot trading mode and have opened a few flag trade positions. Here’s a summary of the flag trades that I have opened.

Entry Price is placed using a buy stop order above the downward sloping trendline in anticipation of a breakout. This is a conservative entry. Target is based on the length of the flag pole projected from the point of breakout. The flag pole is formed within 2-3 of large price moves signifying an excited crowd of buyers

China Aviation Oil

Entry Date = 10 Apr 07
Entry Price = 1.53
Position Size = 8,000 shares
Target = 1.94
Initial Stop Loss = 1.48
Reward/Risk = 8.2

Chemoil Energy

Entry Date = 13 Apr 07
Entry Price = USD$0.77
Position Size = 10,000 shares
Target = USD$0.95
Initial Stop Loss = USD$0.755
Reward/Risk = 12

(more…)

Weekly Watchlist (09 Apr - 13 Apr)

Sun, 08 Apr 2007 08:40:51 +0000

Lots more flag patterns for this week. Take a look at my shopping list above. My buy price is set at least 1c above point of breakout, with stop loss set at the breakout point. Target is determined by the flagpole. The stocks are sorted from highest estimated profit to the lowest.

Design Studio Flag Trade (Zerocost)

Sat, 07 Apr 2007 08:16:40 +0000

Great News!!! This flag trade proceeded smoothly and according to plan. Exit conditions have been met. The target of 30c has been hit. Now comes some decision making. Do I sell all shares or zerocost the trade. I chose the former based on the followin reasons:

1. The market has started its recovery
2 . Design Studio is on a strong and stable uptrend
3. Company has started turning around its business and it expects growth for the current year.

(more…)

Design Studio Flag Trade (Position Open)

Mon, 02 Apr 2007 07:35:27 +0000

In volatile and uncertain market conditions with the DOW crashing one day and skyrocketing another, time in the market is risky. I would prefer trading short term bullish patterns. Design Studio fits the bill. This is a bullish flag pattern.

Actually the pattern formation resembled more of a pennant than a flag. There is a clear short term support level at 0.225. Rules of pattern construction for pennants are the same as for bullish flags.

(more…)