A Letter From A Member
While we provide setups throughout the day, the goal of
TradersWire goes beyond that. We want to teach subscribers
who may not know how to utilize the power of the
Insights From The War Room to use it as a tool to aid their own
trading research. In this space today, I want to showcase an example of one
member who wrote to tell me about a recent trade she found after hours of researching the setups from TWI.
Duke,
I thought I would share this chart
with you. Now I can’t say anything regarding the daytrading
stuff, because I don’t daytrade (well, at least I try not to). But, for those
looking for great swings, all they have to do is pay attention and, like you say,
do a little homework.
There was a post on
Insights From The War Room
on 12/13
about
(
TKTX |
Quote |
Chart |
News |
PowerRating)
hitting its 20-day moving average. Every night, I print out the Insights pages
and review them for trade setups. This just happened to be the one that I picked
up on that night. I have attached the chart so that you can see what I saw. To
me this is just a “beautiful” chart. Wish I could have five of them a week.
Here’s what I saw:Â
First thing I noticed is that all the moving averages
were in
proper order (that’s a hard one to find these days). It closes just below its 20 MA
but just above the support zone. It has bounced off up trend line and there
had been low volume on the pullback, until 12/13, which I read as
“exhaustion.”
I forget exactly what the RS and ADX were at the time. I usually make note of
that, for some reason this time I didn’t. I do know that the RS was somewhere
in the 80’s and the ADX was UP. So on 12/14, I place an order just above the 20
MA and get filled at 40.20.Â
Usually I wait for a follow-through day and enter
the next day, above the prior day’s high. However, there was such a confluence of
“good” things, I decided to take the early entry. At that point the reward to
risk was very high (high potential reward/low risk). I exit the trade on 12/18
(three days later) for a profit of 4.40, (a little early from the highs) high that
day was 45.08. But, as the story goes, “can’t pick the lows and highs”! The
only reason that I got out early instead of waiting to get “stopped out” is that
I have noticed lately that a lot of stocks are retracting once they hit their 52
week high. Now, it may make a new 52 week high, but my guess is that it will pull
back first. And as so many have done lately — it could just fail. So, take the
money and run.
Anyway, I just thought that you may want to share
with people why it is a good idea to use the Insights, even on a nightly basis,
for the next day. They just need to take what the Insights gives them and review
the charts! There have been many others that have played out nicely also, but
TKTX was such a great example.
Now, with all that said —- could you find me some more of these? He he!
Cathi
This is not to say that this is the only way to trade, or that
everyone should trade like Cathi. The point of this is that she took the
Insights, did her homework and uncovered a trade from which she made a profit,
helping us to realize our goal. Use the stocks and setups and find those that
fit your personality, style and risk tolerance, and I know soon you will be
finding gems like this one. Thanks, Cathi!
Until tomorrow,