Indeed two weeks later, 13th October 2010. Massive price movement today and this is no coincidence at all. By Mastering the art of intrepreting Demand and Supply in the Market, I am able to predict what the
SMART MONEY activities thereby taking advantage of the situation.
Interesting, I would usually exit all or partial during a massive bull run day. I did it again today by selling
50% of my holding to secure a nice pot of profits on the table and leaving the rest of 50% soldiers to fight through the upper channel wall (known resistance level).
After the Market closed at 17:05, I re-evaluate the stock to make some assumptions for tomorrow's session.
How I know that the bull run will continue tomorrow or fade out completely by tomorrow?
The answer lies in the today's transacted price and volume.
From the chart, price has just closed near the upper channel line which is $0.655. Breaking out of
this channel by tomorrow will be bullish as the upper channel line can become the new support level
for the price to propel further northward.
What if price really pull back tomorrow, what will I do next?
In my Personal Trading System, I utilize the Pivot Point for cut loss or profit protect strategy..
Base on today's closing, the pivot point is $0.63667. Therefore my profit protect level will be
set as $0.635 for tomorrow session. If the stock is subjected to massive distribution by tomorrow,
I will be out of the game at $0.635, generating 6.5cents of profits on 50% holding.
Another scenerio could be today's volume is not sustainable, therefore I expect the tomorrow volume
to be significantly lower and inorder to know if price will continue to go northward, I hope to see a small
negative price bar closes within the body of today's bar. See sample below.
This sample shows that after a massive upside the previous day, everyone will be wondering if the price
will continue to head higher or subject to profit taking.
When price pulls back with much reduced volume, this will show that "Yes" there maybe some selling pressure but the pressure has reduced significantly because the closed price is not lower than the low of the massive upday. This is a bullish sign and may mean that the Professionals may want to move the stock price higher very soon and they are just taking a short break.
Anyway, the stock price is now in the upper channel level denoted as Sell Zone (Above the dotted red line).
It's time for harvesting.
Being GREEDY in the market is the Sure way to lose BIG.
