Bought 1000 PMV.VN @ 0.62

Update January 26: The share price of PMV.V crossed my mental stop yesterday so I had to reassess the position. I sold my shares at \$0.56 for a loss of (\$0.56 - \$0.62) * 1000 = \$70 + \$19.90 commission = \$89.90 = 0.9% of account. Gold is falling while USD tanked this week. The lack of volume on today's goldminers rally is also uncharacteristic of the recent uptrend. The long term uptrend of gold and gold miners is unmistakable on both fundamental and technical basis. I am taking a dabble in this junior gold miner as its share price is making a gap fill on a recent breakout (Fig. 1), amongst other things. Intraday chart (Fig. 2) is also showing signs of life at this support level. What's going to happen to gold as it breaks below 1350 (first time since November) from worries about Chinese inflation, which led to strength in USD (on fear of further Chinese tightening) as EURUSD dropped 60 pips in 2 hours. See FT: Fears grow that China is overheating. Couple that with political and economic uncertainty, we have a short term uncertainty in gold's direction. However, all these is in line with the underlying gold-bug case that money is becoming more worthless as governments pump in money to their respective economies. Another point to note is that as the Shanghai Composite and Bombay Stock Exchange (i.e. growth markets) are making 3-month lows in recent weeks, people will start to look for other assets to diversify their wealth. This is all conjectures anyway. I can't predict the future.I am merely placing my bet as the stars seem to have aligned for me to increase the probability of this good reward/risk trade. Mental stop is \$0.55. Hard stop is \$0.48, however, I'll give it some margin and say 0.40 is my stop as liquidity is thin in this junior. Thus, risk is (\$0.62 - \$0.40) * 1000 = \$220 + \$9.95 commission = \$229.95 = 2.4% of account. Note: You might have noticed that my trade log style has changed for 2011. I am trying to jot down my thought process rather than the data analysis and numerical logic to better capture my thinking for the record.

[caption id="" align="aligncenter" width="570" caption="PMI Gold Corp. (PMV.V)"][][][/caption] [caption id="" align="aligncenter" width="570" caption="PMI Gold Corp. (PMV.V) intraday"][]1[/caption]

Posted 20 January 2011 in stocks.

I didn't miss a boat. I missed a freakin rocket!

The purpose of this post is not to bang my head over this wonder. There are always other opportunities in the market. The purpose of this post is to remind myself that:

  1. my analysis can be so right, sometimes; but more importantly
  2. my entries and exits timing are still terrible

I can't use the same techniques I use totrade forex and large caps in these junior miners. I'm used to riding waves on a boat. I need to adapt and figure out ways to ride rockets (a friendly reminder that most rockets will fail to launch), as Uberlu suggested in a comment. Here's what happened. I lamented about my missed opportunity in establishing a position in Ventana Gold (VEN.TO) last week. VEN.TO is a company in which I've been very bullish and took numerous dabs at for months. This is the picture of VEN.TO last Monday. It already propelled to \$11. [caption id="" align="aligncenter" width="570" caption="Ventana Gold (VEN.TO) on November 8"][][][/caption] Now this is VEN.TO today. [caption id="" align="aligncenter" width="570" caption="Ventana Gold (VEN.TO)"][]1[/caption] VEN.TO closed at \$10.03 on Tuesday. It opened at 13.61 on Wednesday on news of a takeover bid.

Bought 300 VEN.TO @ 8.95, Stop 8.80

Update Oct 20: I raised my stop to 9.10 this moring. It got stopped out 2 minutes before the close for a small profit. Following the covering of my short side play this morning, I sneaked back in to the gold bug camp. In particular, I bought some of my recent favourite gold miner, Ventana Gold Corp. (VEN.TO), a few minutes before the close. Gold held on to the 1330 support as I've discussed this morning (see gold chart in this morning's post). I also watched the closing 30 minutes of the market and VEN.TO respected its 8.90 support level too. See Figure 1. There was a brief touch below 8.90 but it pushed back up quickly (not shown). This is a play inline with the direction of the recent rally. Just riding the trend. Nothing fancy. Hard stop is \$8.80. Mental stop is \$8.88. Maximum risk is (\$8.95 - \$8.80) * 300 = \$45 + \$9.90 commission = \$54.90 = 0.5% of account. There's a risk of another gap down open tomorrow. So my position is small in case the market runs away overnight.

[caption id="" align="aligncenter" width="570" caption="Ventana Gold Corp. (VEN.TO)"][][][/caption]

Posted 19 October 2010 in stocks.

Sold 350 HGD.TO @ 10.84, Profit +2%

China not-so-surprised the market (their delayed Treasury report was a hint) with a 0.25% rate hike overnight (WSJ: China Raises Interest Rates). The US Dollar shot up, precious metals took a big hit. I close my gold short soon after the TSX market open to collect some quick profit. Rinse and repeat. I did mention that this trade is a short term swing. I bought this Horizons BetaPro Gold Bear Plus (HGD.TO), a leveraged gold short, on Friday and unloaded it this Tuesday. I fought against my greed to hold just a little longer. But the ascending support line on gold is too obvious to ignore (Fig. 1). Thus I closed this short term position with this 5%+ gap up while the market is still deciding what to do. Furthermore, I noticed the equities market are holding rather well at the open. S&P500 held onto 1170 price level. Asian markets were marginally green overnight. And even the CAC in Europe is fighting an intraday low as the North American markets open. Thus, the sky is not falling just yet. I figured it would take more omph to push this market further down as we are indeed in a strong bullish move. At the very least I am expecting some retaliation from the bulls. This can't be this easy for the bears, can it?

[caption id="" align="aligncenter" width="570" caption="Gold"][][][/caption]

Net profit for this trade is (\$10.84 - \$10.27) * 350 = \$199.50 - \$9.90 commission = \$189.60 = 2% of account.

Posted 19 October 2010 in stocks.

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