My first T.A.decided buy (the all mighty IHG)

[MoSteph]

Today I decided to do a little technical analysis experiment (as exciting as it was!) and buy IHG (OZ). It appeared the gradual RSI, OBV divergence over the last few months was growing and so in the name charts I embarked upon my first almost entirely T.A. based trade. As anticipated and prayed for the movement continued upwards, but being semi-new to TA some opinions from those with more experience would be appreciated. Phaedrus if you could have a squiz, I would love to know what you think.
I am aware that trend is new and because of its previous steep downward movement the upward trend I’ve outlined doesn’t have all that much history.
Don't worry I'm setting up the stop loss as we speak.

Thanks

I just realised i can't post the chart...how do i do this??? Does in have to be uploaded first?...weird

[whiteheron]

Mo Steph

You are starting off on the right foot by setting up a stop loss
It took me some time and some rather big losses before I realised the necessity for the stop loss
I am now a firm believer that all trades should be protected by stop losses , as no matter how careful and / or confident you are some trades will not be good ones

The old saying "stop your losses and let your profits run " did not come about for no reason
Apply stop losses rigidly and I can assure you that they will save you heaps over time
Dont set them so tight that you keep getting stopped out by normal market "noise " but set them at a level that will prevent a catastrophic loss should things turn to custard
The above advice is free ; to learn it cost me heaps

With trading you have to do your research , weigh up the probabilities and act accordingly --- it is only you that can make the final decision as to whether to proceed or not

I hope you do well , but be aware that it takes time , research and fortitude

[zyreon]

you have to save the .jpg or .gif to a website and then copy+paste the link to the graphic

or make it on www.bigcharts.com and post the link

[MoSteph]

Cheers ears

http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=au%3Aihg&time=8

anyone looking should java chart it, and check out the OBV, RSI, Stochastic indicators.

[Phaedrus]

MoSteph,
How to post a chart :-
http://www.sharetrader.co.nz/topic.asp?TOPIC_ID=20654

[MoSteph]

Eureka!!! Thanks Phaedrus

IHG

http://img.villagephotos.com/p/2005-2/949170/IHG.JPG

[rotsevni]

Have you also seen this thread:
http://www.sharetrader.co.nz/topic.asp?TOPIC_ID=21209
and the ASX thread it points to?

[MoSteph]

Thanks...I hadn't.

[kittydashwood]

Sustained high volumes look good for your agruement. The market has a memory and closing over .05 would draw out sellers

[MoSteph]

Indeed...though at 0.047 it seemed to do much the same. Indicators are still looking strong. I actually reckon this one will continue climbing well past .05, but it'll move a whole lot slower. RSI's new highs are somewhat sudden and questionable; monday will be interesting.

[Phaedrus]

MoSteph, what is your exit strategy here?

[MoSteph]

Good question and one I’ve been debating with myself. Admittedly if I had invested more than what I did, I probably would have exited by now. But I didn't, and seeing I reckon this Co will indeed successfully make a turn around, I’ve pushed my stop loss up and will wait for signals. I entered using T.A., but want to hold fort because of fundamentals.

Phaedrus, how would you exit?

[kittydashwood]

Keep tightening stop limit as the sp rises.

[rotsevni]

Just updating the chart for whoever is interested...

the shareprice and RSI trendlines are confirmed (green arrow)
the OBV trend is steeper than before (see break in slope and scale change) resistance around 45c is expected again (and 50c after that), but looking good.

http://img.villagephotos.com/p/2005-2/949184/IHG.jpg

[rosey]

GPG seem to see some potential in this co with there stake in it now
18% i think
this could be a + sign
cheers
Rosey

[Halebop]

GPG bought at significantly higher prices too which ultimately did not prove to be a bullish signal.

I think Kittydashwood gave good advice to keep ratcheting the stop loss. As we've seen from previous price action this one turns very quickly and volumes can dry up too.

Not one I'd choose using either TA or FA.

[MoSteph]

As I recently learnt; tightly set stop loses on volatile stocks like this will indeed preserve capital, but they click in a lot and buying in later at more is poo. I guess the question (like always) is: does IHG have it in them, or rather does the market think they have it in them? After some research and FA I still haven't the foggiest and have taken the profit while it's there. They seem to have proven their skills at a destroying value... But maybe GPG’s influence/$$$ and the new top dude will have the golden difference. Time will tell. How exciting.

[rotsevni]

It's more exciting if your in. MoSteph, what's your plan?
I'm still holding.

[MoSteph]

true...keep on watching, I guess. This is a scary stock and i get scared.

[rotsevni]

Good to know you'll be keeping an eye on it then. Don't forget to post if you see cause for concern. I'll do the same. Thanks

[zyreon]

2 sayings for doubt:

"If in doubt, just get out"

and this one's probably more of a rule than a saying ( due to lack of imaginative use of words): "If in doubt trade smaller"

[MoSteph]

Well I would be trying to get out now...Indicators looking shabby. RSI and price trends, though small, have been broken. I reckon it'll be a short wait till the next wave.