Bought Apwr – lesson learned about buy stops

So I thought by putting in a buy stop at $31.16, above the previous day’s high that I would only be a buyer if the stock was in another upward move.  I was wrong.  I actually ended up being the high for the day as the stock spiked to my bid, then collapsed to low, lows before ending the day basically neutral.  Buy stops it seems are the same as sell stops…you always run the risk of just hitting them.  To make matters worse APWR seems to be in a strong downward movement today, on decent volume.  I had a stop in at $28.75 and an alert at $28.95.  It hit the alert, but thankfully not my stop.  It has recovered somewhat today, but still down 4%.

I have to admit that this trading is playing with my emotions, the very things I’m trying to remove from the equation.  With JRCC last week I was riding high as it kept chugging, but this week with apwr I’m doubting myself and my theories.  I think this is where I remind myself that:

1. I’m still new to this approach, it will take time to refine my skills
2. stocks go down, a lot…you will buy lots of stocks that go down over your life time
3. You’re supposed to hit the stops / alerts on the way down.  You want out of falling stocks with minimal losses
4. Stock / investment performance has NOTHING to do with who you are

Whew.  Feel better.  It’s amazing how my mood can swing with the price action.  Perhaps that is why I should look away during the day.  Trust your stops and your alerts.

Wow FSYS looks great today.  I am thinking about putting in a buy alert for that bad boy.  It seems to have everything I want…good upward momentum, great volume, and a model that puts it into that the “unknown optimism” category.

Buy order – Apwr

Apwr has recently broken to new highs, 3 over the last week.  Today it was up to a new high scratching $31 several times before settling in at $30.82.  I put a buy order in for 480 shares at $31.13, since that seems to be a minor hurdle for the stock. Overall the fundamentals look really good, moving up 50% in last 6 months and most recently 40% on huge volume.  Even more amazing is that the company is really, really fairly valued, is growing rapidly, and has the amazing combination of China + energy + Wind.  Wow.  If I’m able to buy, then my stop will go in at $29.75. If the stock continues to move up, then I’ll buy more in the upper 30’s.

Looking for unchecked optimism

I realized today that what I’m really looking for in a company is one that operates in a space that has:

1. A tremendous amount of unknowns

2. A tremendous amount of optimism

Yes, these two things + greed really are the recipe for a bubble, but who wouldn’t want to invest with a bubble?  We’ve seen several over the last few years, and of course the hang over after the pop always wipes out the memories of the excitement.  Bubbles are great to invest in, as long as you have an exit strategy.

So I’m really looking for companies that are moving up on good volume AND are in an industry or country or both that contain the two things above.  Some of those at the moment include: China, India, Brazil (emerging markets in general), Energy in general, ag, fertilizer, food, power generation (solar / wind).  Just take a look at all the new highs at the moment, they are ALL in one of these spaces (although very few emerging market winners at the moment):

http://finviz.com/screener.ashx?v=340&s=ta_newhigh

jrcc – riding high

Jrcc was up $4.76 today on volume of 3.6M shares (well above daily average of 1.3M).  It almost closed at the highs of the day.  It was part of the continued strength in coal, which pushed up just about every coal related stock in what was otherwise a down day.  Since I’m trying to learn here and not just make money by being lucky, I want to take apart this trade a bit.

I first found JRCC last Wednesday when it hit the new highs list on Finviz.com of $44.36 on volume of 1.9M, the strongest of at least 30 days prior.  I watched go down nicely on volume of 1.6M the next day, which really seemed to be a temporary breather for an upward surge. It went up on the 10th on 1.8M a share, closing nearly at the highs of the day, down the next, and then a big move up on the 13th.  I thought that the few down days were merely a pause for a big surge higher.  I thought $48 was the upper limit of the old, short term range.  I put in a buy at $48, it hit that.  When it showed continue strength, I bought again $51.

I’m looking for patterns here, looking for something that I can replicate.  Not really sure I have that yet.  All I see was a stock really moving with the tide, that also had some good stuff going for it (very few hedged reserves which allows them to sell their coal at spot prices which have skyrocketed, very few tradeable shares between inst ownership + insider ownership + short interest) but I’m not sure how to pick out another stock like this.

jrcc – keeps moving

JRCC is up $2.50 this morning to $57.03 on very good volume.  I really can’t believe the run this stock has had just in the last few days, but all moves up have been on big time volume.  I moved my alerts and stops up again this morning to previous daily highs. I’m tempted to sell everything at daily highs today, but instead I will just keep a close watch on it.  It has established a daily pattern of moving up at open, weakening until about noon, sitting until about 3pm and then running up at the close on strong volume.  I will watch to see if this happens, if it does I will be able to move my stops up to a profitable range.

Jrcc – 2nd Buy

This stock has continued to show strength, moving higher over the last 4 days on good volume.  I bought some more shares at $50.60.  I had a buy order in much lower ($50.10) to take advantage of its typical morning weakness, but I got scared I was going to miss it.  It’s not ideal to bounce around buy orders, but I didn’t really have anything to base my original price on so I don’t feel so bad.  I can see that I need a better system for establishing buy prices and stops.

Speaking of that: my alert is now set at $48.75 based on the day’s high from 3, and my official stop is $47.21 based on the high of day set 4 days ago.  Again not really sure what to base these on, so I figured this system was as good as any I have at the moment.

Moving forward, I’ll continue to keep a fairly close stop on this thing as it could really blow at any moment.  I still can’t believe that it continues to go up daily with near record volume levels.  I wonder if shorts are being squeezed, big $$ is buying, or possibly both.  Either way, I’ll do my best to continue to ride the trend and protect my downside.

JRCC-Buy

Bought JRCC at $48, based on my belief if it broke $47.50 it would run for awhile.  It is up huge for the year, but you can’t deny the strength in this stock right…big up moves, strong volume, and strong industry fundamentals.  Coal is as hot as energy source right, especially when some of the biggest producers are running at full capacity.  JRCC also one of the few that didn’t hedge position, so they are selling coal at spot market prices…which have skyrocketed.

I’ll put a stop alert in at $40.40 which seems to be a brief level of support, but won’t sell unless there is heavy volume associated with a sell off.  Line in the sand is $38.50…here goes!