The idea of holding both short term and long term parcels in the same stock is one I got from thearchitect whilst trading SRT. Needless to say, I made a little bit, and he made a truckload.
If you look at the chart below, the overall run has been from 3.5 to 7.0 which is a 100% profit.
There were, however, several smaller runs within that overall run which you could possibly trade.
3.5 to 5.6 was 60%
4.3 to 6.6 was 53%
5.2 to 7.0 was 34%
5.5 to 6.6 was 20%
Grand Total 167%
Now you'll never pick the absolute tops and bottoms of these runs (especially with my limited charting skills), but if you reduce each gain by 10% you would still end up with 150%.
ALC is absolutely not the stock you just want to hold a short term parcel in, as going in and out of the stock, you are likely to miss the SP rise of many expected price sensitive announcements. Thus, you keep a long term parcel as well, so you never miss out.
This short term trading probably works best in a stock where the Fibonacci retracements are 50% or 62%. The strength of ALC indicates the retracements may only be up to the 38% range, in which case it could be hard going, and not so profitable.
Anyhow, that's the big picture of how it works. Now if I could only figure out how to get in at 3.5?
ALC Price at posting:
6.4¢ Sentiment: Hold Disclosure: Held
