From October 2010 to January 2011 --- Lucky period
As a novice, usually one gets very lucky to win or succeed in the first few plays when doing things. For example, playing cards game, gambling, etc. I recalled I gained 1500 dollars in the first 3 visits to Atlantic City playing 21, then gave up all gains back to casino in the next month. This happens to my trading also.
From October 2010, I started serious trading. The first thing I did was to close all the positions I had. I wanted to have a brand new start - 50 percent off the initial portfolio.
My technical analysis learning is from a website called onlinetradingconcepts. I think this is a very good website for beginners. It talks about basics about technical indicator, Candlestick Pattern and Chart Patterns. From this website, I am amazed that there are so many indicators to give signal when to buy or when to exit. With technical analysis, a person is no longer a blinded man for trading. There are guidance, method, tools one can use.
I recall the first trade I had after learning the basics is to long AKAM. One day I notice that the MACD had a bullish crossover, which gave a buy signal. By holding AKAM for nearly one month, I had a 20 percent gain.
But in October 2010, my trading account did not grow. The reason I thought was I did not know what was a good setup, what kind of stocks I should trade, how to use different time frames for decision, etc. I noticed that even though I purchased stocks with signals like MACD bullish crossover, RSI overbought/oversold, stochastic crossover, a lot times stocks did not act like same way as the textbook said. Hence I think I need some teacher to teach me.
The best thing in October was that I found a lot of good trading blogs. They gave me bread and butt to learn about trading. To name some of my favoriate blogs at the beginning, they are afraidtotrade, Alpha Gobal Inverstor, art of trading, slopeofhope, samuraitrader. After following these traders for a while, I signed up the art of trading service in November.
Art of trading is maintained by Traderstewie, who is a very good trader and mentor. From Traderstewie, I learned a lot of new things for trading. Traderstewie sent out good long or short setup everyday. From these charts, I understand what kind of setup Traderstewie looked for. A lot of them were break out setup and support buy setup. Traderstewie was also showing how to use $NYMO as a tool to find out if market was in oversold or overbought zone. Hence I know there was market sentiment tool for market timing. To follow him, I signed up the stockcharts.com service to create my own charts, chart lists, scan tools.
I also trade earning playing in this period, and all of them were successful trades. LOL, that is what I call lucky. At each weekend, I check Samuraitrader's blog. He had a earning schedule for next weeks. I used the stocks in it for trading earning. Short ULTA before earning, long FNSR / LEN before earning. All turned to be winning trades. Only luck can explain this. Now I won't play earning any more.
The luckiest trade I had is the ARIA trade in January 2011. In the morning two days after I longed ARIA, I notice ARIA was up 25 percent in premarket due to some news like positive results for its study drug. I was totally not anticipating this thing to happen. Now ARIA is a 10 dollars stock instead of 5 dollar in January. Now I understand that the lucky event I encountered in January is an Episodic Pivot for ARIA. ARIA is the trend following stocks one should long.
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