Tuesday, February 17, 2009

Trades: VLO, USO and STLD

Here is the intra-day trade alert I sent to my subcribers (this is not a regular feature of the Trade Report, but I do send trade alerts from time to time):

The gap down this morning blew past the entry and stop points I had set for SSO and QLD. Also, most of the stocks listed in the report last night also gapped below entries and stops. Obviously I made no entries in these setups.

Two stocks holding up above support are VLO and STLD. They did gap down, which is a violation of my "orderly pullback" rule. However, they still provide low risk so I decided to enter with small positions.

200 shares VLO @22.94. Stop 21.90. Target 24.90. Risk: 2:1

200 shares STLD @11.56. Stop 10.90. Target 13.90. Risk: 4:1

Due to the nature of the market and the gap downs, these are *not* high probability trades. Those that are looking for wins and can't take losses should not make these trades. Since there is a possibility of multiple are gains, I am willing to take these trades, with the expectation of loss.

I also made a *speculative* energy trade. USO is extremely oversold (stochastics at 11).

200 shares USO @ 23.88. Stop at $22.90. Unsure of target.

The idea behind these trades is they will only give me small losses and have the possibility (not probability) of multiple R gains.

Again, do not piggyback these trades unless you have done your own analysis and realize that they are not high probability trades.

No comments: