Many Ways to Win

 | Jul 02, 2014 | 12:02 PM EDT  | Comments
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Trading gives you the right to change your mind. GoPro (GPRO) has been great for days, and suddenly it's deadly to your portfolio today. I was looking for a possible run to $50. Admittedly, I wasn't thinking it would happen in just a few days, but we did hit $49.90 yesterday. 

I didn't have the guts to short it. It was a hard borrow, but the risk/reward felt a bit random. Unfortunately, we can't always act on our thoughts or thesis. I changed my mind. I didn't want to get long by any means, but just felt risky being short, and making money would have been a result more of luck than anything. The $50 target was based on a round-number theory tied with a Fibonacci idea. However, given the time frame of the move, it didn't fit with the rest of my thesis.

Speaking of changing my mind, I intended to add to Vale (VALE) on a close over $13.50. While I still like the position and still like the chart overall, I've had a little too much heartbreak with this stock. Of course, it dipped right after I got into it the first time. After the last two days, I am seeing green, and I'm comfortable with my position, but I'm not looking to add here in front of the holiday weekend. 

A good exercise in a bull market is to try and find bullish charts that don't all look the same. If the charts look the same, then chances are that correlations are very high, and buying several different names will have results very similar to simply buying one name. Me, I don't like that.

So here are very simple price charts with the RSI included, on ACADIA Pharmaceuticals (ACAD), Celldex Therapeutics (CLDX), Finisar (FNSR), Weibo (WB), and Starbucks (SBUX), a somewhat diverse group. Yes, there are two biotechs, but for five names, this isn't too bad. I see all these charts as bullish setups with solid potential, but note by simply flipping through the charts how very different the patterns are.

ACAD Daily
CLDX Daily
FNSR Daily
WB Daily
SBUX Daily

I talked yesterday about how the market may have a little move upside and the VIX more downside, and this is further support. If you can find multiple bullish charts with very different setups, in my experience it is a positive on the market. So take a few minutes over the weekend to do this exercise yourself.

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