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One of my positions crashes and burns!

Sometimes it just doesn’t work out. This week my long position in William Hill hit its stop-loss, just below the ma50 and was closed.

2015 04 16 William Hill

 

Mostly, I just run my stop-loss below the ma50. Maybe with this position I should have given it a bit more leeway as just a few weeks ago, even though it was on the rise, it was trading below its average for the year. So, I made a loss on this trade. I aim to risk the same amount per trade, and tighten up the stop loss each week, in order to reduce my exposure. If my risk when I opened the trade was 1R, then my loss on this trade was 0.8R, so I lost less than the maximum that I was prepared to risk.  This is easy to do with a rising moving average as the stop, as I can shift the stop-loss upwards each week just below the ma50. It’s much harder to do if I’m doing a turnaround trade, as I am doing with oil (USO), and wheat, as the ma 50 is often falling, not rising. With those trades, there is no rguideline to move the stop-loss each week, and the risk exposure remains the same, until the ma starts to change direction and move upwards. If William Hill continues to rise from here, I shall feel cheated. But I’m not a bitter person (I think). I may still yet go long William Hill in the next few weeks – watch this space.

However, my trade this week is to go long (buy) Debenhams.

2015 04 26 Debenhams

 

Why am I buying it? Apart from the fact that its not a very sexy trade (see last weeks post to understand…)

  1. It has made a new high
  2. There is a series of higher lows
  3. It has made a series of higher highs
  4. The ma20 crossed above the ma50 a few weeks ago
  5. And, it looks like it’s trending upwards…

I am placing a stop order to go long. May Debenhams do mightily well in the weeks and months ahead…..

Oh yes, do you remember me talking about the trading spread with Air Partner a week or so ago? Guess which share currently has a rating of 100 (the max a share can score) on Stockopedia this week? Yep, you guessed correctly. Luckily I bought some shares and stuck them away in a trading account. They will not appear in my videos about my trades, as they were not a recommendation in my trendfollower programme.

Happy trading!

Catch up with you next week