Fed has "no clue what US economy is facing going into year-end squaring of positions"
Fed has "lost respect of any economist & market follower today"
Fed "inaction will go down in history as lack of grasp on credit mess"
Market "tumbled in shock"......
Bids were withdrawn from most stocks to unbelievable levels.......
So.....what do we do as an investor or trader ????
Some of you have already reacted by doing what felt right to you.....
Some took loss...some booked profit and majority did NOT do anything !!!!
Wall Street is NOT the place to either "overextend or panic"
"Comfort level is a MUST @ all time"
I hate to say this "repeatedly"....I pulled some more money out of this market around 8AM...before I bought HOKU,DSX & add-on RIMM.....as I take pride in being disciplined "no matter how ROSY the market looks"
Why do I mention this repeatedly.....I can assure you...it is NOT to BRAG but to pursue the purpose of this BLOG....is to honestly & sincerely encourage disciplined approach to investing/trading.......
I was NOT expecting fed to disappoint today @ all.....still I chose to pull the money out from my trading account.....
My portfolio is :
AAPL,RIMM,AGU,LDK,DSX,HOKU.......
I did NOT sell any shares today......
My losses were helped by my short Canadian $ which tumbled by 74 tick against US$....after factoring everything my loss for the day was 3.1%......
There is a"rumour that fed is planning to do something to ease credit ....as reported by Steve Leesman of CNBC"......according to his sources...Fed were quite ALARMED @ the market reaction today........
ps...It is NEVER a good idea to sell...when markets are in FREEFALL...like today...if one can wait....it is better to sell before close next day...as market may recover substantially by close next day.....
I am sure that White House is NOT pleased with investor reaction......especially in an election year....& Christmas @ hand....I am sure Mr BB got a "firm phone call from GWB or his close adviser".....
Based on CNBC & my speculation...do NOT be surprised to see some strong fed role before market opens !!!!
Try NOT to think of today...but look to wed for some recovery by CLOSE...I hope !!!
BLOG does NOT give buy or sell.
Saleem
18 comments:
Saleem, I am really starting to get your point of being disciplined at all times, good and bad. I overexposed myself today, thinking the Fed would do 25 and 50. I am going to reflect deeply on your post tonight and start keeping more even keel on % $ to each stock and not overexpose myself in the future. I am getting so much from your blog. It truly is becoming one of my best training forums. I am glad that I have gotten past rookie panic mode and managed to hold to fight another day, as you eluded to in your blog tonight. Talk soon and thanks again, Doug...
Hi Doug,
As you & most people know that my BLOG has no agenda.....
The stated purpose is to show by example...with integrity & details which nobody thinks of sharing.
If investors/traders learn even a single idea from me...then I know that the purpose of my BLOG is fulfilled and that will make my day !!!
Saleem
Saleem, As you know my life situation right now, I need to make a monthly income and wether that is good or not, it is reality. I know its not good to talk personal dollars, but because this is very serious to me, I am going to break taboo and discuss a little more personally with you.
I really like to swing trade, keeping 4-5 stocks in different sectors and taking them off when they reach my profit target. but I have come to the conclusion that in my current situation, needing to make a monthly income and take that money out of my account to pay bills each month...I am finding that it does not give me enough control, as one stock could turn south and wipe out all profits booked that week and I would be at zero gain. So, this is what I want to propose to you for your feedback: I am considering day trading and trying to, each day, make my $ goal for a monthly target. I would close each day in cash (for the most part) and just keep track of daily gains. I am working with just over $100k. I am thinking about using IH picks, and buy on intra day dips and sell with small gains, to add up to my monthly needs which would translate into about $400-600 per day. I am also considering attempting a strategy of not letting a stock go under my buy point i.e. buy at $50 looking for it to go up .30-.50 cents and sell but if it starts to breach my buy point at $50, just immediately take it off the table and try again. Commissions are only $7 a trade so I am not concerned with a few attempts per day to make my goal. What I am suggesting is, do you think it is a feasible strategy to either make money on a trade or break even but not lose money (or as minimal a loss as possible), other than commissions by selling the stock before it goes below initial buy point? And secondly, do you think $100k is enough to work with to generate the desired returns of $400-600 per day? I have done a little day trading and I have found it very difficult but I have been able to do some of these quick $400 pops. I would probably only use about 20% of money for any given trade and maybe have 2-3 trades going at any given time. I know that the way you trade, which is similar to IH, is the best way to make max dollars but it doesn't provide me a for sure way to say, I know I can take out x amount at the end of this month and still have all my original 100k to continue to work with. If Patti goes back to work, I would go back to swing trading in a heart beat but for right now, Im just wanting to pay the bills. I would love to hear your take on my proposed way of trading??? Please just be honest and don't worry about discouraging me or anything, just tell me what you think, if you get a minute. Thanks Saleem. Doug...
I just realized how long my post was. Sorry Bro! LOL. When I went to Jamaica for vacation, Patti and I were hanging out with some local friends that we had made and they nicknamed me "Rambling Buddy" i.e. talk too much. LOL...
Down 1.36% today...not too bad considering the market. Oh well tomorrows another day to look forward to.
Current portfolio:
AAPL - 38%
BIDU - 13%
JEC - 10%
LDK - 15%
VMW - 8%
Cash -15% **
** Sold my GENZ and RIMM positions today.
Regards,
Bruce
Hi Doug,
In order to make money...you need to follow one system with confidence.
You seems to get off track from IH...which is not good.
You have less stress with swing trading as long as you follow a disciplined trading.
You need to work on discipline first which is key to making any money.
$100k is enough money for swing trading.....
I will NOT encourage you to go for daytrading @ all....reasons are many...but to name one......
daytrading will exaggerate your loss even more.
Your expectation of making $100k with $100K is totally unrealistic...
NOBODY can make 100% in a year as a strategy......
You need to focus on 25% free & clear first...then see if you can improve on it.....
I do NOT see better than 25% as a realistic goal for you.
My suggestion FWIW.....
Start IH swing trading with only $75K...never touch $25K EVER for trading purpose......
$25 K is for emergency expenses only....
Divide your $75 K into 5 stocks NO LESS.....as I see a tendency to go wild on one position or two position only...that is gambling not trading with discipline.
Markets will always be difficult...
I expect 2008 to be more difficult than 2007.....
You also need to work on REDUCING your expenses.....Lifestyle should reflect what you can conservatively EARN.....
Hope this helps.
Saleem
Hi Bruce,
You did way better than market and most trader.
VMW is really doing good for you..even today !!!
I like 15% cash .....Now that is a disciplined approach.
Saleem
You gave me much to consider Saleem. I will reflect on all points. Thanks for your time and thoughts. Doug...
To Doug,
I think Saleem has given you very good advice and you should consider it.
I have never day traded but at one time I was trading way too much..the results were disasterous both financially and mentally.
Follow a well constructed disiplined approach that earns you a lot of singles, doubles, and you'll see an occassional homerun will come to you.
Best of,
Bruce
Can someone please tell me what IH stands for?
Thanks.
Hi Saleem. LDK looked extremely strong until the very end when the markey tanking finally took it;s toll. My question is about the audit. They said it would be out early December. Today is December 12th, only today and the next 2 days of this week would be considered early december. What do you think will happen to LDK if the week goes without he audit. How long are you willing to hold before you sell? Thanks.
Hi Rimm,
IH stands for Investment House...which charges money per month for daily trading ideas.
Doug subscribe to IH.
Of course they do NOT offer guarentees @ all.
IH is technically driven...with target & stops...that is what you get for payment of monthly fee.
Saleem
Hi Minaccess,
I hope ....I have NOT surprised anybody for not only buying LDK but adding 3 times.....& NOT selling ???
In my strategy first is market conditions...which is the strongest time of the year.....
Second I look realistically @ LDK and project...how HIGH it can go...I see easy $80 based on my analysis.
Audit is a non-issue as it will show very little discrepancy...which is KNOWN to the real players....
You dont get 13 million volume day after day...unless hedgies KNOW & doing their buying....
GS is buying also.....any moment they will come up & upgrade the stock to $120 target....
Of course these are all my speculation & I am playing accordingly...$80 to $120 this is where it is heading imho.....
Saleem
Thanks Saleem. I was tempted to sell 1/2 at 62 yesterday, but i also see at least 80 this year. Peace
Good morning Saleem, The biggest take away from your post to me is, the fact that, even though you did not expect the Fed to dissapoint, you still took money off the table. That is experience and market wisdom. I have thought a lot about it and, I tried to game the Fed announcement and that was arrogant. I know now that in the future, I will play it more disciplined. Why expose myself to craziness in the market? Greed. I will be more controlled in the future. Thanks for sharing. Doug... p.s. I bet you get a kick out of seeing folks like me, in my second year of trading, searching for the same things that you searched for, years ago, in terms of answers to market approaches... LOL. Im sure you say to yourself all the time, "Oh, I remember when I considered that". LOL. Its great to have your experience to kick around different ideas so that I can get straight answers like "Don't Do That!!! LOL. Thanks again Saleem.
Hi Doug,
Life & stocks offers NO guarentee.
The world does NOT care if you FAIL.
Being REALISTIC and planning on SOUND footing is the ONLY way to go.
You think anybody would have cared for my OPINIONS or take on different stocks....if I was NOT doing a quality research and offered something to THINK about DAILY twice per day ????
Success comes with GREAT PLAN & DISCIPLINE...no more no less.
Hope you are carrying some of my effort for you in your real life EXECUTION.....otherwise I am just wasting my time.
Saleem
saleem
What is your take on RIMM. I have money sitting in it and it does not show any sign of life. Do you have a tentative target since you added some yesterday am.
Thanks
Arvinder
Hi Arvinder,
RIMM reports next thursday the 20th.
I believe that RIMM has found support yesterday and id NOT go below $97...$97.40 was the low.
I will wait till 20th before ER and see where it is and may sell before ER.
RIMM is pretty good today...higher low $90.08..so far and if we are lucky ...we may see higher high soon....just a technical read !!!
Saleem
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