PLS chart, page-12777

Hi Recherche


I am sure some people find intra-day charts valuable, especially day traders, etc, but that's not how I deal with the markets.

I do use daily charts to signal warnings on overbought situations and oversold situations. I have managed to free carry or partially free carry a number of my stocks by using the various features of the daily charts along with FIB's to take advantage of these situations. This is coupled along with the weekly and as your have seen in my last post even the monthly charts to put things into long term perspective. These trades are infrequent.

In overbought situations for my long term stocks, I have never picked the top to sell a portion of my holding. In oversold situations I have never picked the perfect bottom to increase my holdings. That's wishful thinking, getting close to those regions is good enough for me. Sometimes the opportunities pass on by, that's life in the markets.

Stock selection is critical before everything. I spread seed capital around knowing that a portion may go under, some may take time to mature enough to begin the run, some I catch on the pullback of a good run for my first entry. I have owned all of these categories. Some of my choices being underwater for a good period is not unusual. For some of my most promising infant stock I hold, are still underwater for me, but they survive and in my view still have real potential.

Recognising and acting on overbought situations is extremely difficult and trying to pick the top before the pullback will drive you crazy. Acting on it is the most difficult bit. I use all of my charts and experience to help with this procedure. An example. A seed capital stock I bought in its infancy at 0.06 , then adding some along the way during at the start of a run, rocketed to over $2 for a very very short period while powered by the FOMO. With the charts and decades of experience I sold a small portion in the 1.60s more than easily free carrying the stock. A non ASX300 stock at the time so CGT was due. That's when I used my dud seed capital stocks to avoid the tax (so the duds do have a purpose). That stock is now a ASX300 stock ( buying in my super, no CGT on profits) and is currently trading in the 0.60s and could drop into the 0.50s where I think it will be oversold and then add to my holdings. I very much like the long term future of this stock but time is an issue.

With PLS which I partially free carry, I think we are approaching the oversold zone and will be looking to add to my holdings soon. If the SP turns upward I will miss the opportunity, this has happened to me in the past with some stocks and will happen again at some time. That's life in the markets.

What worries me about your technique of switching to the fastest moving growth stock is the real quality of the stock your moving into as I have seen many of the fastest growing stocks crash and burn. But to each his own.

Sorry about being so long winded, but I am having trouble getting to sleep.

All the above is my opinions, as always DYOR.

cheers Lies

PS hope the sandman come soon.