FCPO Trades November 17, 2005

FCPO February 2006 – Descending Triangle Breakout Trade 3 – Closed with a net loss of RM280

Trade Management
November 17, 2005
Entry Strategy for DT: Sell stop order
a. Option 1: If the price opens gaps down from prior day’s low, use Oops! Buy Trade Management
b. Option 2: If the price opens flat or lower than prior day’s low, put a sell stop order at 1406 after FCPO opens.
c. Option 3: If the price opens gapped up, do nothing
Pyramiding Strategy
a. No.

Trailing Stops
a. If the stop order is triggered, put a stop order as the initial trailing stop at 1416.
Exits
a. When your initial stop order is triggered
b. Exit on MOC if the price closed above 1406.
c. When the projected DT target of 1366 is hit.
d. Exit MOC or the next day’s open when there is one long black candle with blow-off volume.
e. Let the trailing buy stop follow the price until it is taken out.

Today’s Entry strategy:
a. Call Apex at 10:30am to check the opening price. Put in your sell stop at 1406. Ask them to inform you when any trade is done.
b. If the stop order is triggered, put a sell stop order 1 tick below the intra-day’s low.
c. Exit on MOC if the price is more than 1406 or my stop is being triggered.

My actual Entry strategy:
I did not monitor FCPO much. But I thought it will not break 1407 support level.
But the price broke 1407 level at 11:30am. My last analysis told me that I can short at 1406 level. The price hit low of 1405.
I called Joanne of Apex to short at 1406. I got it.
The price then moved down to 1403 and rebounded to 1406 during the mid-day.
The price then hit low of 1402 but rebounded to 1406 level. It then moved up to 1412.
At 5:40pm, I told myself to follow to close my position if the price closes higher than 1407.
The price then hit 1414 at 5:54pm. It then moved down to 1410 at 5:56pm. But it moved to 1414 again.
I called Joanne to close my position. She told me that tries to enter at 1414. But the price moved so fast during the last 3 minutes and it hit my stop of 1416.
I lost a net RM280 (RM250 + RM30 commission).
I felt regretted for not taking the cheaper loss earlier.

Trade executed according to plan? YES



What I have done best:
a. I follow the Descending Triangle trade management rule.
b. I do not monitor the price very often.
c. I do not get nervous during my trade.

What I need to improve:
a. I need to improve the rule on MOC exit for failed descending triangle breakout.
b. I should close the position between 5:55pm to 5:56pm because crowd losers usually wait the last minutes.
c. Do not be fool by last minute move.

What I have learned:
a. When I ready to get out, call Apex and tell them “Get Me out now”. I should not care the price because I know that I was wrong. It is a cheaper loss.
b. The best time to close a losing position is at 5:55 and 5:56 time.