WFAD #34
$XOP & $MA
$XOP
SPDR S&P Oil & Gas Exploration & Production, $XOP [NYSE]
ETF
The first trading idea was selling ETF of SPDR S&P Oil & Gas Exploration & Production ($XOP) (see pic. 1).
The result is shown on the pic. 2
We sold a ledge breakout and expected a nice move down. Several days after the moment, when this forecast was done, price started to form a new ledge. The second ledge was broken up and price penetrated into the territory of the first ledge. We set our stop over the middle line of the first ledge. Unfortunately this recommendation has generated a loss.
Now we can see that the character of this descending move is not impulsive. So, one more upside move is possible. Wait for bullish patterns and buy $XOP.
Loss from this recommendation = appr. -2.56% in 8 days (-115.2% annually)
The lesson is =>
- Losses are an integral part of trading. Your mission is to manage them efficiently = make them as small as possible.
$ MA
Mastercard Incorporated, $ MA [NYSE]
Financial | Credit Services | USA
The second recommendation was buy stocks of Mastercard Incorporated Financial ($MA). (see pic. 3).
The result is shown on the pic 4.
A very standard setup for a buy. The most interesting thing here is a management of the stop-loss order. Everything was going excellent till the earnings publication. The day before the earnings we had a profitable long position with a protective stop at 108.1 level. This stop-loss was protecting appr. 3.69% of our paper profits. $MA management announced, that its sales growth is slowing down, so the day after the publication of earnings, $MA stock price gapped down and our trade was stopped.
In the end we could take only +1.35%. It’s much better, than a loss.
Profit from this recommendation = +1.35% in 32 days (+15.18% annually)
The lesson is =>
- Once again. Stop-loss order is not a guaranty of your position safety. Be careful and keep it in mind.
