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Tuesday, April 29, 2008

Well, Vacation Will Be Over Tomorrow . . .

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: I'm coming home from vacation from Queretaro Mexico. The first trade I can think of sitting from this computer? Is a seasonal date in Hogs around May 5th. I'll detail more when I get home. Unfortunately, my computer blew up just before I left (The CPU overheated) and I'm going to hope I'll be able to connect as soon as I get home.

Personal Investing Thoughts: The same. I will review my investment portfolios when I get home, and see where we stand. But we are fast approaching the end of May. Which means investors generally "walk away" for the summer months.

* * *

Well, we tried to get some video for everyone. But it just did not cooperate. We visited an ancient city called Teotihuacan and I climbed to the top of the Pyramid of the Sun, and we walked along the avenue of the dead. But as I said, unfortunately, getting the video from the camcorder, to the computer? Well, just didn't play ball.

Regardless, it's time to get my head back in the game.

My Desktop PC blew up just before I left on vacation. I think the CPU finally and completely overheated, but while down here in Mexico, I managed to snake a replacement chip. Hopefully, my motherboard isn't fried. We'll see.

We leave for home from Queretaro Airport tommorow at 8:15 pm. Should be home by 4:30 pm Detroit time. As soon as I can, I will post what the plan for the Challenge accounts will be for May, 2008.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Thursday, April 17, 2008

Vacation Entry - Disconnecting from the Markets. Sorta.

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: I'm on vacation at the moment near Queretaro Mexico, therefore I'm trying to forget about trading for a bit. I'm trying to clear my head.

Personal Investing Thoughts: The same. I did notice while we were traveling in the airports yesterday however, that the market had a great day. As much as I try to disconnect from the markets, I still want to keep somewhat of an eye on things.


Well, we arrived yesterday, 7:30 pm, Queretaro time, and arrived at my buddies house soon thereafter. Cracked a beer, and had some fantastic authentic Mexican tacos in Tequisquiapan. As I stated above in my 'Investing Thoughts' comments, when we stopped at airports, I still was keeping an eye on the markets. I'm still not too sure what moved the market yesterday, as I couldn't get a hold of instant news. But my portfolio had a fantastic day. My FRO shares jumped up to the $54 region for the first time since last July. My MS and BAC both jumped up. My DTE stock is now up around $2.00 since the purchase. Even my nothing Ford stock is trading in the $7.20 region.

Regardless, I'm going to get back to relaxing. Enjoying myself. I personally believe that vacations serve the vital function of refreshing yourself. Every once in a while, you have to get away to recharge yourself, so that you can work that much better when the vacation in over. Not sure when my next entry will occur, but I'll try to update when I can.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Monday, April 14, 2008

Outta Here . . .

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. Leaving for vacation, so quite frankly, I'm trying to forget about trading for a bit. Clear my head.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks, and recently added a very small DTE long term DRIP position this week. I will check in every few days on the news while I'm in Mexico. My bearish outlook hasn't gone away. I don't even want to think about what the CPI will be. The inflation beast will rear it's head unless the Fed stops cutting rates. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs.


The luggage is out in the living room. The cats are getting that 'freaked out' feeling they always display right before we go on vacation (They won't have anything to do with us for at least 4 hours when we get home). The wife is busy finishing up the laundry. I have house sitters lined up (please don't trash the house guys).

Quite frankly, when it comes to investing and trading, I'm trying to clear my head a bit. I'll keep an eye on the overall market, but for the next few days I'll be busy, so no telling when I'll be able to update the blog. Keep an eye on for the next update . . . it might be from Mexico.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Saturday, April 12, 2008

Week in Review for April 13th, 2008: Investing vs. Trading. Lets take a closer look at General Electric (GE)'s stock slide

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month. We seem to be falling from the top of this sideways channel the market has fallen into lately. But even then, there isn't a whole lot of volume.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks, and recently added a very small DTE long term DRIP position this week. My bearish outlook hasn't gone away however. I don't even want to think about what the CPI will be. The inflation beast will rear it's head unless the Fed stops cutting rates. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs.

Day Three of the sucky videos. But I really wanted to make an entry, considering GE's move yesterday after missing earnings. GE posted horrible results. It's the end of the stock market and the world!

Or perhaps.

Not.

This video will also be included in my investment series of blog entries.

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)



The next entry in my investment series, will discuss the importance of dividends.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Friday, April 11, 2008

Charting 101: Chart Patterns and Day Two of the Sucky Videos

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We seem to be ranging at the top of the channel that's developed in this market. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks, and recently added a very small DTE long term DRIP position this week. My bearish outlook hasn't gone away however. The inflation beast will rear it's head unless the Fed stops cutting rates. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs.


Ok. Day two of the Sucky Videos. Having no nice charts to show you because I'm using YouTube's direct upload.



In this video, I discuss "links" to chart patterns. Here is the link to a Double Top Pattern. Here's an example of a Bull Flag. Here's an example of a Head and Shoulders Pattern. As well as an example of Symmetrical Triangles.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Thursday, April 10, 2008

Charting 101. Sorta. I'm considering Buying an Apple, and a Discussion on Volume . .

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We seem to be ranging at the top of the channel that's developed in this market. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks, and recently added a very small DTE long term DRIP position this week. My bearish outlook hasn't gone away however. The inflation beast will rear it's head unless the Fed stops cutting rates. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs.


That's it. I've had it. Windows Movie Maker is an utter, complete waste and piece of garbage. The stupid thing is? I knew better. I knew better than to take on a project like this, with graphics, charts, sound and whatnot? With Windows. Windows is a piece of garbage when it comes to manipulating video. Why? Because Windows can't handle exceedingly complex memory functions for crap. So believe it or not, I'm actually reading about buying an Apple.

My brother was showing me on his Apple, that he runs Windows XP. What the heck? Why do I still have this piece of junk operating system that that I paid $350.00 for? I don't really play games any more on my PC. Vista is fat piece of bloated licensing nightmare - that eats memory like I eat Hershey Kisses - so I don't even want to go near that monster. I've switched over to using OpenOffice for all of my word processing and spreadsheet functions; since they can use the Word and Excel file formats. Plus I got sick of the licensing costs for Office. So why am I running Windows again?

Regardless, here's the video, such as it is, for today . . .



* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Wednesday, April 9, 2008

Windows Movie Maker Problems . . .

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We seem to be ranging at the top of the channel that's developed in this market. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks, and recently added a very small DTE long term DRIP position. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs.


Well, I have this beautiful video ready to go to discuss volume, complete with charts. Too bad Movie Maker won't let me save it without either rebooting, or just freezing the entire system.

Microsoft? I'm done with them. I'll either build myself a Hackintosh, or just buy an Apple. I'm sick of this mess. Microsoft as an operating system is a piece of garbage. The registry system has become so bloated, so huge, such an intricate web, that you can't even install a freaking codec for video viewing, without destroying Windows Movie Maker. The registry stupidity and maze has gotten to the point, where we expect that Microsofts new OS, Vista - should run best with 3 gigs of memory. That's insane. I have operating systems here that fit on a floppy.

I've been working with this mess all day now. I can't believe I paid $350.00 for such a poor operating system.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Tuesday, April 8, 2008

Charting 101 (Series): How to Use Moving Averages When Trading and DTE Energy Purchase (VIDEO)

Challenge Accounts:

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We might be seeing a small capitulation rally in this bear market right now, now that the 'talking heads' have admitted that we are in recession. They are like your best 'capitulation' guage. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs. But at the same time, I have an itch to expand my personal investment portfolios. This morning, I bought, in my NON-CHALLENGE ACCOUNTS, DTE for a long term DRIP play at $40.21. Here's the certification of that purchase:


As I mentioned the other day. Just a nibble to scratch an itch. I maintain that if the recession is a short one (1 year) then the bottom could come any time as the market will be the first one out of the recession. If the recession is longer (2 years) then we haven't seen the bottom yet. I leave the predicting to God.


Ok. In the previous entries, we discussed the concepts of support, and resistance. How moving averages are constructed. That trends tend to continue, until proven otherwise, and that they come in long-term, short-term, and medium term trends.

Remember, when two different trends collide, the larger trend tends to win the battle.

In this video, we start bringing it all together.



In the future, I will be discussing Volume, Chart Patterns, and Indicators.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Monday, April 7, 2008

Charting 101 (Series): Support and Resistance on a Chart (VIDEO)

$500 Challenge Accounts:

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We might be seeing a small capitulation rally in this bear market right now, now that the 'talking heads' have admitted that we are in recession. They are like your best 'capitulation' guage. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs. But at the same time, I have an itch to expand my personal investment portfolios. At the end of trading today, I will take a look at the action, and for my NON-CHALLENGE ACCOUNTS, I might purchase some DTE for a long term DRIP play. If I did, it would be just a nibble, not any massive purchase. I maintain that if the recession is a short one (1 year) then the bottom could come any time as the market will be the first one out of the recession. If the recession is longer (2 years) then we haven't seen the bottom yet. I leave the predicting to God. I might take a nibble soon, but that's all it would be. A nibble. Cash would remain my largest position.

Ok, let's return to discussing basic charts. In the last video I had regarding charts, we discussed weighting our moving average, so that it does not lag.

Before we discuss how to use moving averages with a trend, let's take a look at a key concept that will enable us to do that. Support and resistance.



In the next entry on Charting, we'll bring what we've learned so far . . .

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Saturday, April 5, 2008

Week in Review for April 5th, 2008: Real Results and DTE Purchase

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. We might be seeing a small capitulation rally in this bear market right now, now that the 'talking heads' have admitted that we are in recession. They are like your best 'capitulation' guage. I have no swing positions as I have a vacation coming up; and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs. But at the same time, I have an itch to expand the investment portfolio. Even after today's video, I might. I say again, might purchase some DTE for a long term DRIP play. If I did, it would be just a nibble, not any massive purchase. I maintain that if the recession is a short one (1 year) then the bottom could come any time as the market will be the first one out of the recession. If the recession is longer (2 years) then we haven't seen the bottom yet. I leave the predicting to God. I might take a nibble soon, but that's all it would be. A nibble. Cash would remain my largest position.


The week in review for the week ending April 6, 2008. I talk about the benefits of Covestor, and the concept of taking your theories and ideas in the market; whether it be the Forex, Commodity Futures, the Stock market, day trading, whatever, and turning them into real profits.

"Presvetli". Timothy Sykes. Sean Hannon. These guys show real results. Say what you want about them, their theories prove profitable.

Covestor provides for transparency.



* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Friday, April 4, 2008

Welcome to Your Real Recession (VIDEO)

Challenge Accounts:

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. Wow. Didn't see that coming. I had no swing positions, so nothing lost due to my outlook. But wow. Nearly 400 points on the DOW on Monday. I have a vacation coming up though, and I don't want to get caught in the middle of a swing trade, before I leave. Therefore, no trades this month.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs. But at the same time, I have an itch to expand the investment portfolio. Even after today's video, I might. I say again, might purchase some DTE for a long term DRIP play. If I did, it would be just a nibble, not any massive purchase. I maintain that if the recession is a short one (1 year) then the bottom could come any time as the market will be the first one out of the recession. If the recession is longer (2 years) then we haven't seen the bottom yet. I leave the predicting to God. I might take a nibble soon, but that's all it would be. A nibble. Cash would remain my largest position.

It has arrived. They've finally admitted it. Unemployment jumped up past 5%. We've warned them for months, and months and months that a real, honest to god recession was on the way. And now, here it is.



I promise to get back to Charting 101 on Monday

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Thursday, April 3, 2008

Charting 101: How to Use Trends - Weighted Moving Averages

Challenge Accounts:

Investing Account Balance: $241.92

Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10

Personal Trading Thoughts: Cash. No positions. Wow. Didn't see that coming. I had no swing positions, so nothing lost due to my outlook. But wow. Nearly 400 points on the DOW on Monday.

Personal Investing Thoughts: Cash is my largest position. I still hold all of my long term stocks. My bearish outlook hasn't gone away. But there is another possibility. We could 'channel' for a while. In other words, a short-term bottom might be developing, as the market goes sideways for a while. I'm still prepared for a 35% drawdown from the highs. But at the same time, I have an itch to expand the investment portfolio. I might. I say again, might purchase some DTE for a long term DRIP play. If I did, it would be just a nibble, not any massive purchase. I maintain that if the recession is a short one (1 year) then the bottom could come any time as the market will be the first one out of the recession. If the recession is longer (2 years) then we haven't seen the bottom yet. I leave the predicting to God. I might take a nibble soon, but that's all it would be. A nibble. Cash would remain my largest position.


Ok, let's return to discussing basic charts. In the last video I had regarding charts, we discussed how simple moving averages are constructed. We also mentioned a problem with simple moving averages. They tend to lag. Why? What do I mean? How can we work to eliminate this problem? By 'weighting' in the average. I discuss these points in the following video:



Tomorrow I'll discuss using your moving averages together.

* * *

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.10


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and tolerance for risk.

Wednesday, April 2, 2008

Airelon's Thoughts: April 2008

Challenge Accounts:

Investing Account Balance: $241.92 ($40 Deposit clearing)

Stock / Futures Trading Balance: $734.39 ($50 Deposit clearing)
Online Savings Balance: $22.10 (Monthly Interest Paid $0.03 and $10.00 Deposit)



Herein, is my monthly outlook that I post near the beginning of each month . . .



A few things when I watched congress talking with the Fed chairman last month? Bernake did not even try to sugar coat it. He knows. Unemployment figures will be rising. Inflation will be rising. Now we have food shortages around the world. Greenspan handed him an absolute disaster.

I need a break from this mess.

* * *

Investing Account Balance: $241.92 ($40 Deposit clearing)
Stock / Futures Trading Balance: $734.39 ($50 Deposit clearing)
Online Savings Balance: $22.10 (Monthly Interest Paid $0.03 and $10.00 Deposit)


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research and risk tolerance.

Tuesday, April 1, 2008

The Low Funded Challenge Accounts: April 2008

Challenge Accounts:

Investing Account Balance: $201.92

Stock / Futures Trading Balance: $684.39
Online Savings Balance: $12.07


A video summary is to be found at the end of this entry.

These sub-accounts were created by me back in October 2007 as a main feature of this blog. Their purpose, as well as the purpose of many of the articles in this blog, is to assist the low-funded trader understand what principles he needs to consider when trying to get started in the markets, or if starting up again because his account has been wiped out. That as long as one enters this business with the proper principles, strategy, education and emotional discipline in hand, you can 'make it' in this business. These are actual sub-accounts at my brokerages that I own, and I will look to for growth. I will announce actual trades and investments that I perform in them, and the money management rationals and reasons for my decisions as a means to educate others.

In the beginning of this experiment, I placed $130.00 with Sharebuilder as a long-term investment account, and I placed $370.00 in the account for trading Futures options. I thus termed this the "$500 Challenge". Since we now have $898.38 as a cumulative total in these accounts, not $500, I will term this the "Low-Funded Challenge" instead of the "$500 Challenge". At times I will refer to them simply as the "Challenge" accounts. I later added a small ING Savings account that has $12.07 in it.

I also had three rules for the "Challenge" accounts. At the beginning of each month, I review and consider where we stand, and how those three rules impact the current months decisions. So let's do that for February.

Rules for the Challenge Account:

1) The initial investment is $500.00, to be split amongst the accounts. We did that back in October of 2007. $130 went to Sharebuilder for longer term investments, and $370 went to the Xpresstrade brokerage for futures options purchases. Xpresstrade was later bought out by "optionsXpress", therefore this is now the optionsXpress account. This account is the 'trading' account, for stocks, etf's, and futures options.

2) Each month, I can contribute $100.00, that can be split amongst the accounts however I choose. In other words, I can send $30.00 to Sharebuilder, $70.00 to optionsXpress; or $100.00 to optionsXpress, and nothing to Sharebuilder, etc. Last month, we deposited $10.00 to our ING Direct Savings account, $20.00 to the optionsXpress trading account, and $70.00 to our Sharebuilder Investing account. We had then a trade in Orange Juice Futures option that we cashed out in profit for about $179.50. We received a dividend payment in our Sharebuilder account of $0.46 therefore, our balance there is currently $201.92

Now we have arrived in a new month; April. This month I'm going to do switch up the deposits again. In April, I am going to contribute $50.00 to the optionsXpress trading account, $40.00 to the Sharebuilder account, and $10.00 to the ING account.

Our optionsXpress balance is currently $684.39 that I use for trading. At the current time, it's used for trading futures options. With this months deposit of $50.00 to the account, the balance will raise to $734.39. There's a reason I didn't send more than $89.00 (My usual risk per trade) to the account. If I can ever line up a house sitter, I'm leaving for vacation to Mexico for much of the month. And it's always a bad idea to be in a trade while on vacation. So I figured I would use rule #2 to bump up the other accounts a bit. The $50.00 is already on it's way to this account today, April the 1st, which means it probably won't clear until about 4/4/2008, or so; bringing our account balance to $734.39 before any trades.

I will send $40.00 to the The Sharebuilder account on April 1st, 2008. Sharebuilder is pretty quick about clearing funds, so this will raise the balance to $241.92. Given the state of the economy and market I want to start building this account up. Why? Because I feel the market is going to be trying to find a bottom for the next 9 months to a little over 1 year. Whenever that happens (I honestly have no idea), I want that account as funded as humanely possible so that we can start to look for great Dividend stocks to buy for long term DRIP plays. And I need to use around $650 or so to purchase stocks, so the account needs bumped up a little. The market is down about 10.43% for the year as I right this. That's -10.43%. But we're at least bringing in 2.37% interest (Scratch that, make that 2.29%, it just reset again) on that money right now. Mind you, we only have $241.92, and stagflation has arrived. What do we mean?

With the current (yes I said current) recession and the Fed's attempts to slow it down, as well as deal with a full blown credit and solvency crisis; the money you make on interest in a money market account now isn't keeping up with inflation. CPI Core inflation (excluding food and energy) is at 4.03%. The Sharebuilder account will earn approximately 2.29% interest on the money that's in there 7 day yield, and there are no fees for either account (Mind you, before Ben started with the rate cuts, that yield was 4.48%). Which means we are earning -1.74% on that money, relative to inflation. That's right NEGATIVE 1.74%. But that account was never planned to be using the money market yield to grow. We are beginning to add to this account for it's future growth. So I figure we should start building that account up by a little, and earn a little more interest at the same time; so we are ready when it does come time to purchase long term stocks. However, the commissions would eat me alive for what little shares I could purchase in the Sharebuilder account. In addition, I believe we are still within a bear market. We discussed some time ago that to purchase a dividend stock, we would to spend around $680.00 for your basic dividend stock purchase. And simply because, or when we have $680.00 in the account, does not necessarily mean that we will purchase an investment stock. Patience means that we must wait for the right opportunity.

I will be sending $10.00 to the ING account on April 1, 2008. This account usually takes a few days to clear.

3) I'll be using regular investment and trade vehicles. Bonds. Stocks. ETF's. Futures Options. In April, after I find a house-sitter, I'll be on vacation in Mexico. So quite frankly, I'm not going to be trading a lot in April. It's always a bad idea to be caught in a trade as you are going on vacation. As I highlighted in the "strategy video", the primary goal for the project right now is not to trade. It's to follow money management principles and increase the account equity.

If it is one thing that I've learned, is that the next time I perform this experiment, I will start out with a higher amount than $500. Probably $1300.00. Open-mouthed



Aprils' Balances after contribution (before trades)

Investing Account Balance: $241.92
Stock / Futures Trading Balance: $734.39
Online Savings Balance: $22.07

* * *

Investing Account Balance: $201.92
Stock / Futures Trading Balance: $684.39
Online Savings Balance: $12.07


Total Trades and Investments: 3
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $82.56
Average Loss: $82.56
Accuracy Rate: 33%
Average Reward: $179.75
Risk : Reward Ratio: 1 : 2.02

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

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