Trade with the trend, cut your losses short, let your profits run, and manage risk. Still not clear? Read the Trading for Dummies lessons.
RFMD, 30-minute Chart
Covered at .85 ... colorful chart to follow. I've got to skedaddle because it's Chinese New Year's Eve and I've got to go shoot off some fireworks. See you tomorrow!
Let's think about how the average person (let's call him Joe) would have approached RFMD, and then compare that to the principles the Chairman has taught over and over again.
1) Joe thinks RFMD is down 'too much,' it's a 'bargain,' he wants to buy it. 2) Joe doesn't know Jack about charts and just enters long willy-nilly. 3) Joe never uses stops because they're for 'suckers' and 'wimps.' 4) Joe lets his losses run and hopes things will get better tomorrow.
RFMD is breaking down nicely, this might be a very profitable trade for me.
RFMD, 30-minute Chart
Back for a second here. I was looking on the web for Byron Wien's annual report, 'Ten Surprises for 2004.' I couldn't find it in English, but I did find it in Chinese. Fortunately I can read Chinese. ;-)
Earlier today I listened to an interview with Milt Bearden, a retired CIA officer who speaks Chinese. He wrote a book called The Black Tulip which I'd like to read. (It's on my Wishlist, hint hint.)
OK, I'm taking off early, see you at the close. (VRTS would have made an excellent short, but I was looking long -- no trigger means no harm, no foul.)
Looks like I'm going to get jammed out of SONS (darn).
P-stop 8.80 SONS (short)
The price for the 'Howard Dean as Democratic Presidential Nominee' contract just collapsed following his third place finish in the Iowa caucus. Note the head and shoulders top preceding the fall (I'm joking).
Tightening P-stop to 10.32 in RFMD on this expansion bar.
P-stop 10.39 RFMD (short)
Tone is very poor, I'm looking for an unusual suspect to short, waiting for a spot.
VRTS, today's swing trade, gapped down on the open, and the tone is looking pretty poor, so I doubt it will trigger today. Just set an alert and forget about it.
Taking a long view of Merrill Lynch (don't forget about the dividends). It's easy to get caught up in the day to day noise, but it's better to develop a perspective informed by history.
Merrill Lynch (MER), Quarterly Chart
Eyes on CKFR, RFMD, SONS, among others.
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VERITAS Software (VRTS), Daily Chart
Crude Oil is moving higher. It may reach the measured move level that I pointed out in mid-December sooner than expected.
Crude Oil futures (CL), Daily Chart
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Chairman MaoXian