281210 - I decided to trade Straitsasia when the momentum is RIGHT

Hi Traders

Referring to my earlier post on 24/12/10 where I explained the strategy that I would use to trade Straitsasia.

If you have missed the post, check it out below link:
http://volume-price-spread-for-metastock.blogspot.com/2010/12/241210-road-to-riches-depending-on-how.html

Straitsasia has been meandering within channel since May until today. The angle of the slope is above 45 degree which provides me with the clear indication that this stock has been a favorite by many
professionals. I had advised that I would be watching this stock for the next 1-2 weeks to make sure
that the base support is strong enough for the price to move up north again.

Today, the price displayed strength and I decided to take a speculative stake with calculated risk. None of my expert indicators has triggered positive buy signal yet. With past experiences, if price continues to move up for the next 2-3 days with average volume, I am sure that one of my indicators will trigger me to go long with this stock.

I hate this guts feeling to buy before my expert indicators say so, but sometimes it takes GUTS to stand up for what you believe and be responsible for the outcome. In this case, I chose to go with my GUTS feeling and please pray for me.

During the course of my trading years, I have developed numerous calculators such as Risk to Reward, Pivot Point and Fibonacci.

Below is one of the calculators that I use when planning a trade.

As an example, I use StraitsAsia for illustration.

Lot Size: 10lots (1 lot = 1000shares)

Buy Price: $2.51 (above pivot level and moving averages)

Cut Loss: $2.43  (below recent's support level)

Target: $2.75 (past known resistance level)

With the above information, I will be able to obtain an estimated rewards ratio for this trade.

If the ratio is less than 2, I would not consider to take trade.

Till then, cheers

Wishing you and me alot more profitable trades in the New Year 2011.