MPEL - Melco PBL Entertainment (Macau) LTD Update 122206
I’ll be away from my trading turret Tuesday, and wanted to update my online trade in MPEL - Melco PBL Entertainment (Macau) LTD. before Wednesday. I was looking for continuation in the trade, which did not happen. This is a good lesson in not turning a winner into a losing trade. I had doubled up on my amount of risk before the close Thursday. You can see the stock never really rose above my add point around 20.05.
My first entry was 19.55, and I really didn’t want to see that entry turn into a loss after not taking 1R profit on the trade. When the stock broke that entry I sold the whole position.
1. Never turn a winner into a loser.
2. Keep your losses small.
MPEL may not break the bottoming tail I believed it put in. I know though, that by following rules 1 and 2, that I will stay in this game much longer. Keep an eye on the daily chart for the higher high buy signal.
December 29th, 2006 at 9:38 am
[…] During this light week of holiday trading, I’ve mentioned a few stock picks I was looking at. I sold MPEL - Melco PBL Entertainment (Macau) LTD. last week. I was too aggressive by buying a second entry. The next buy signal I mentioned to watch for was a higher high on the daily chart. We got that Wednesday when I returned. You can see there were then multiple entry signals, as shown on the 5-minute chart. The stop-loss could be set by placing it under the low of the previous day, and taking a 1/3 off the table at set targets. […]