An illustration of what it means by missing the boat in trading

As I wrote last Friday, I took a long position in Teck Resources (TCK-B.TO) at $36.03 but got stopped out at breakeven. In hindsight, the retracement after testing the $37 resistance held the 50% level near the close. That was a bullish sign that I missed at the time and only realized during my weekend review.

As you know, the TSX market gapped about 2% up and S&P gapped about 4% up right at the open. The market traded in a range all day but managed to hold the gap.

However, EUR/USD closed its gap and is testing 1.27 support as I write this. The EUR/USD pair will be an important pair to watch as the European Union drama unfolds.

With regard to TCK, Figure 1 speaks for itself. It gapped up about 8% and closed up 8.78% at $39.53. I decided not to chase the market early on today as the reward/risk ratio just isn’t as appealing anymore.

There are always opportunities sailing around the corner. So there is no need to go out of breath chasing that one missed boat.

Tech Resources (TCK-B.TO)

Bought 110 TCK.B.TO @ 36.03, stopped out at breakeven

Update May 10: Looks like I missed the boat. TCK.B gapped up almost 7% at the Monday open to $38.88. I won’t be chasing the market at this point as the reward/risk ratio isn’t appealing anymore.

Update: I got stopped out at breakeven (after commission) before I can post this piece at the end of the day. I’m back to all cash going into the weekend.

I am taking a dip in Teck Resources (TCK/B.TO) with 110 shares bought at $36.03. This is a trade to “buy when everyone else is in fear”. Following my assessment of the market yesterday, I don’t think things are that bad, yet. So I am establishing a small position in a strong company today.

TCK is trading on its 200 day moving average at $35 this week (Figure 1). Yesterday’s epic dive and recovery didn’t break this $35 support. So that’s a very good sign for TCK.

Tech Resources (TCK-B.TO)

Furthermore, $35 is an obvious psychological round number support. It is also above the recent low of $32.50 printed in February of this year as shown in Figure 1. The oscillator value (top of Figure 1) is making a positive divergence as TCK is testing this support level).

I entered today based on the 5-day intraday chart. This morning’s opening hour test of $35 support has lower volume than earlier this week (Figure 2). As such, I think $35 can hold. So I entered when the price shot above minor resistance at $36.

TCK-B.TO intraday snapshot at time of entry

The price drifted back under $35.50 after I entered but then reversed and tested $37. I moved my stop loss to breakeven as it touched an equidistance price opposite of my stop. Just so I don’t see profits turn into losses.

If I get stopped out today, I will not re-enter until after the weekend.

My target is $40 and original stop was $35 for about a 4 to 1 reward to risk ratio. I am risking 1.25% in this trade with a position size of 110 shares.

SOLD -277 TCK @4.87

I took some time today during lunch to study the move of TCK. TCK made it above $5.00 in the morning with mediocre volume. Then I watched it break above $5 again around noon and it was disappointingly unspectacular. This isn’t a good sign. On top of this, S&P 500 seems to be on the verge of breaking below the support of 780 as I’ve noted in the morning pre-market analysis. So I decided to place a stop to close my long-held position at $4.87, just below yesterday’s intra-day trough at $4.88. TCK was marked at $4.98 or so at the time.

Then at 13:19, my stop was triggered. Two hours later, TCK is now trading at $4.65. The S&P is holding out at 770, which isn’t all that bad. Perhaps this is just a shakeout before another leg of this bull run. Perhaps 800 was indeed the end of this leg of the rally. I’m not sure at the moment. What matters is that from my analysis, there is a higher risk than reward expectancy at the moment. So I’m just saving my chips rather than risk them over the weekend.

Teck Cominco Ltd.

BOUGHT +150 TCK @4.77973

Added to TCK on this 30 point S&P500 drop day. I now have a full position in TCK. Why am I adding to a losing position? Here’s why.

Teck Cominco

Stop: $4.50

Target: $7.0

BOUGHT +127 TCK @5.51969

I’m back in TCK again. TCK is one of my favourites. I’d very much would like to keep it as a core position if the market permits. That’s why I’ve been keeping an eye on TCK for a re-entry since I cleared my position a couple of months ago.

Teck Cominco

Teck Cominco

Upside: Figure 1, bouced at 20 day MA support. 20 day MA crossing over 50 day MA soon. Price still within uptrend as shown in Figure 2.

Resistance: $6

Downside: TCK in short term downtrend. Indicators showing signs of weakness.

Support: $5.40 and then major at $5.0

Stop: $5.30.

Target: $6.30