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This is video week_02 for swing trading the stock GCI. Idea is that you follow the trade evolution and that you systematically learn applying all technical analysis techniques that were presented in thebasic learning videos.
For trading GCI, we are using a chart template of which the last version is presented HERE. It is possible to be informed immediately when a trade is opened or closed. Click the RSS feed button at the top right of this page and follow the instructions. Otherwise you can also look at this page to find out about the latest actions. Every weekend, there will be a video update like this one commenting the past week using a simulated account and some preview.
We will use a daily, weekly and eventually an hourly chart. On these charts we will use a number of indications as shown in the template and as explained in training video 034.
This is not an invitation to trade this stock, information given is to be used for training purposes only. Stocata.org will not accept liability for any loss or damage which may arise directly or indirectly from use of or reliance on this information.
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This is the second video of the life swing trading example using the stock GCI. Idea is that you follow the trade evolution systematically learning to apply technical analysis techniques. Receiving live trade signals is possible from an RSS link at stocata.org. Please note, this is not an invitation to trade this stock, information given is to be used for training purposes only. Stocata.org will not accept liability for any loss or damage which may arise directly or indirectly from use of or reliance on this information. Pay a visit to my website at stocata dot org and buy my book “Capturing Profit with Technical Analysis”.
On the weekly price chart of Gannett Company and compared to last weeks' Elliott count, there is a possible alternative. There was a small reaction end April 2009. If we include this in our count, we still may be in the making of wave (5). This count is valid if price moves above the previous January top. If this count is correct, price most probably will move up to the third Fibonacci target at $19.5. The next bar may already take away any doubt.
There is room in the weekly indicators for an up move. This confirms a possible new top in price as suggested in the weekly price chart.
If keeping our last weeks' Elliott count in the daily chart, we may be at a turning point creating a C wave down. However, I do not consider it confirmed yet. I do expect a confirmation with the next bar on Monday. If there is no reversal confirmation we have to give more weight to the scenario as explained with the weekly chart, expecting a further up move. This will certainly be clear next week. For the moment we have no position yet based on the daily chart.
On the daily indicators chart you will notice short term divergences between price and all indicators. This is confirming a possible down turn.
Considering the Elliott count close to completion last week and looking at the hourly price chart of Gannett Company, there was a shorting signal in the hourly chart on Thursday. There was a confirmed bearish harami candlestick pattern at the top; there is a negative divergence between the higher tops in price, compared to lower tops in the indicators, as you will see in the next chart. Price is far away from all the averages and price is breaking the last uptrend line with a closing price.
On the hourly indicators chart of Gannett Company, indicators are oversold and show a short term negative divergence with price in the previous chart. So, I decided to open a short position. I sold GCI at $16.63 Thursday March 18 at 09:34:14 Eastern time.
About 4 hours later, price is nearly touching the 50 hours average, the TRENDS trailing stop and close to the 100-hours average. Clearly you would expect some up reaction here.
This was also visible in the RSI-swing index and the SVAPO indicator, already reaching a low oversold point. As a day trader I would advice here to take profit. You would make around 3% profit in just a few hours.
By the end of the day on Thursday, you would have lost half of that profit. It is clear, that as a day trader you have to react on support and resistance levels for a maximum profit. Of course if you expect a further correction down, you would hold on to the position for the next day. That is what I did, because at least that moment in time I believe in a bigger correction during the following days.
Friday March 19, price moved rather flat for a number of hours, but made a bigger down move the last trading hour, breaking the 50- and 100-hours average and the TRENDS trailing stop. I am still holding this position. If we get a downward reversal confirmation on the daily chart beginning next week, we will of course hold on to this position a bit longer.
We will track the trades here. For now there is an open short position based on the hourly price chart. If closing this position last Friday, there would be a paper profit of about 4%.
This is the end of last week's overview swing trading the stock GCI. Idea is that you follow the trade evolution and that you systematically learn applying all technical analysis techniques. You can receive trade signals during the week via an RSS link at stocata.org. Tell your friends about these videos and while visiting my website order my book “Capturing Profit with Technical Analysis”. See you in the next video for more swing trading GCI.
Risk Disclosure: Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.
Hypothetical Performance Disclosure: Hypothetical performance results have many inherent limitations, some of which are described below. no representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.
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