This is my first big trade (as in I have put a decent amount of cash on the line - its not more than 2% of my total trading capital though) and the first where I have used "technical" analysis as my basis for making the purchase. My main goal in this trade is to test out the theories I have been reading about in "Trend Trading" by Daryl Guppy to see if I can apply them effectively and to see if they work for me.
The second goal of this trade is to see that, regardless of any flaws it contains, if I can follow my plan to the letter without letting emotion dictate my decisions.
Here is my plan for this trade:
Max Chase: $3.25
(I ended up getting in at this price having put my original bid at $3.23)
Reason for buying:
- In an established uptrend
- Guppy Multiple Moving Average says uptrend is strong and is likely to continue
- If price falls below resistance level at $3.18 at end of day, I will cut losses and sell (I found the price $3.18 by using a countback line but didn't include this on the graph)
- I will use a trailing stop loss based on the count back line to lock in any profits if they arise.
Here are my very amateurish chart analysis for HVN, I have only used two indicators in my analysis, a trend line which I am 100% sure is plotted incorrectly, and the GMMA which I absolutely love, I hope it works for me in the market as well as it does in theory (famous last words).
My motivation for posting is:
1) I am interested to hear what people think about my primitive analysis
2) I want to get my trades out in the open because this will provide additional emotional stimulus to follow my plan to the letter.