Wednesday, August 31, 2005

2 up 2 down; SMTX

I'm probably going to pick up SMTX today;
It has gone up a lot already, but on good volume and momentum is still there.

SMTX has moved up in 2 days for the third time now, after wich it consolidated for 2 days on less volume the previous 2 times. I expect SMTX to behave this way again, so consolidating today, and going up again tomorrow.

I'm picking SMTX up for a quick play.

US Army bandage; PHARM.AS

My fundamental play Pharming brought some good news out this morning;

Pharming’s Recombinant Human Fibrinogen Selected For US Army Project ...
Biotech company Pharming Group N.V. (“Pharming” or “the Company”) (Euronext: PHARM) (PHARM.AS) announced today that its recombinant human fibrinogen (rhFIB) product has been selected for a US Army project.

Pharming’s rhFIB will be utilized in a US Army research project focusing on the development of fibrin bandages. For the supply of rhFIB and technical participation in the project, the Company will receive payments over the next year.

“We are pleased with the selection of our recombinant human fibrinogen product in the US Army project,” said Samir Singh, CBO at Pharming. “Given its commercial potential, Pharming intends to supply this unique material for the development of a number of end products.”

Pharming’s immediate focus is to develop recombinant human fibrinogen as an intermediate product for supply to companies and institutions. In addition, the Company is developing proprietary end products using rhFIB, such as the recombinant tissue sealant, to control bleeding in trauma situations.
Complete press release

The good news of this press release is the fact that Pharming will receive payments over the next year. Furthermore Singh is talking about a number of end products. So there is an announcement for more than one product.

All good news and the stock is currently up 3,38%


Tuesday, August 30, 2005

Oil prices will plunge

With oil prices still rising and setting new records, lot's of people are turning (or turned) bearish on the whole market.
Steve Forbes now came with a remarkable opinion; Oil prices will plunge to $30 - $35 within a year

Forbes, editor in chief of the magazine that bears his family name, made his prediction Monday during a keynote speech to corporate executives at Scottsdale's James Hotel.
Forbes said recent oil prices of more than $50 per barrel are the result of speculators.
"About $15 to $20 of the oil price is speculation," he said.


Study 2nd day; PETS

So I predicted the following things on PETS yesterday:
1. go up to the descending resistance from the triangle 2. get out the triangle on the bearish side.
So PETS moved more or less like I expected; It went up strong and closed at 10,55
On the intraday however PETS got to 10,72 which is an intraday spike out of the triangle. So far so good. The thing which is making me doubt (a little) if I get this prediciton right on both points, is yesterday's volume; It was still lower than the previous moves up, but it was higher then expected.

Volume will be interesting to watch today; A move further up on low volume is a signal of weakness (and probably a false break out), a move down or consolidation on average volume (or more) is also a signal of weakness. For the stock to prove strong it has to; either go further up on higher volume than yesterday, or consolidate on very low volume.


Monday, August 29, 2005

Study; PETS

I traded (and lost a little on) PETS before. In my opinion this stock is loosing momentum and will turn bearish in the (very) near future.

To learn some more I'll watch PETS for study.

PETS printed a big hammer for the third time this month on friday. Every time the hammer is followed by a movement up, but the reaction of the 2nd hammer wasn's as strong as the first one.
That's why I expect PETS to go up to the descending trendline from the symmetrical triangle (see chart below), which will come in today around 10,60. One could trade this, but it would be a max 6% win, so I wouldn't recommend it.
With volume declining I think PETS will get out of this triangle on the bearish side.

As a study I'll see if PETS will;
1. go up to the descending resistance from the triangle
2. get out the triangle on the bearish side.

fundamental play; PHARM.AS

Technical Analysis is what I use in my trades. With all my disciplined technical trading rules, I allow myself one fundamental play in which I don't have to sell if the chart tells me to ;)

Pharming was my first stock, and now I bought some again at 3,49 (euro)
Recently it ran up to 5,04 in expectation of a big partner. Pharming decided to go with several smaller partners instead, and do more on their own. This was a dissapointment for investors and the stock came down to around 3,30.
I have much confidence in Pharming and think on the long run they did the right thing in not choosing for one partner. Such a choice is a strong a though one, and I applaud Pharming that they had the guts to be selfconfident and take this decision.
So to my opinion the fundamentals aren't any worse than they were at the time the stock stood at 5,04. That's why I think this stock isn't priced right, and I think it can go up without any news to 4,00 - 4,20 at least. From 3,49 that would be a nice profit to start with.

Pharming Group N.V. is developing innovative protein therapeutics for unmet medical needs. The Company’s products include potential treatments for genetic disorders, medical and specialty products for surgical indications, and intermediates for various applications. Pharming has two products in late stage development - recombinant human C1 inhibitor for hereditary angioedema (Phase III) and recombinant human lactoferrin for nutritional use. The advanced technologies of the Company include innovative platforms for the production of protein therapeutics, as well as technology and processes for the purification and formulation of these products

Sunday, August 28, 2005

Strong girl in a weak market; RITA

Friday RITA rose 1% in a declining market. She did so with very little volume; Only 54,700 shares were traded.
The low volume along with the rise against the market are good signs and indicate strength.
RITA is currently in a symmetrical triangle. A symmetrical triangle doesn't have a bias, and one should look for other signals to predict whether the movement will go up or down. With the things mentioned I think the bias of this triangle is bullish.

Linear Goats; GTCB

Linear or Log chart? That is something I've been wondering about for quite some time. When do you look at a log chart and when at a linear one? For now I just switch between them from time to time and my experience is that it's very clear which one to use most of the time.
If we look at GTCB we have to take the linear chart. On that chart we can see an ascending trendline which isn't there on the log one.
So I decided that linear is the right chart to choose for GTCB.

About the action of GTCB itself; it consolidated some more with declining volume. It touched the ascending trendline and printed a hammer/dragonfly doji which could signal the end of the consolidation period.
GTCB is a complicated play for me. I really expect GTCB to get that approval, so this is a hard one for me to play a disciplined technical play on. But since I choose to trade using Technical Analysis I will trade GTCB according to a technical trading plan; hold the stock as long as it closes above the ascending trendline.

As I said GTCB touched the ascending trendline, and since I'm real bullish on this stock I decided to add some stocks to my position. I got some at the price of 1,76, lowering my entry price for my total position.

Saturday, August 27, 2005

Being right; MSPD

In the first post of this blog I told you it's not about making or losing money, it's about begin right or wrong. Let's look a little bit further into this principal;

Let's look at MSPD; Like I told here I thought it had lost its momentum and I got out with a profit while I still could. If it is all about making money in the stock market, I would be right no matter what happens the next day; after all, I did made a profit didn't I?.
But what about the other very important lesson Jesse Livermore learned us; cut your losses and let your profits run. If MSPD would have gone further up yesterday, I just would have been wrong. It wouldn't matter that I made a profit, cause I had to let it run! Don't eat like a bird and shit like an elephant.

But it turned out that I actually was right on MSPD. It opened right at the 200MA and went down with quite some volume. The fact that it went down on high volume is a bad sign and I won't get back in this one any time soon. MSPD even still has got a gap to close. The gap is still far off, but MSPD might try to close that one.


Friday, August 26, 2005

A beautiful girl; RITA

Let's look at one of my mistakes to learn something here ;)

I took a position in RITA at 4,08 on August the 1st. I thought I was seeing the Candlestick pattern called Three Rising Methods. But it failed. My stop loss should have been the base of the white candle of the first day of this pattern, but I had a hard time leaving this girl out in the cold.
I decided to hold the stock as long as it holds the ascending trendline (see chart below).
As long as it closes above this ascending trendline, the stock is still bullish.

This trading plan resulted in me still holding this girl, while it's at a loss of almost 15%. Money I could have spend on other (better) stocks, is now sitting there with this girl.
But one lessons I previously learned the hard way (more about that later) is Always develope a trading plan and stick to it and Don't sell a stock out of impatience

RITA has got recently some good news out, so it isn't all that bad. But fact is I'm stuck here with this girl I can't abbandon without a good reason, should have had a different trading plan and should have sticked to that one ;)


Loving Goats; GTCB

GTCB is the only stock wich I'm holding on both fundamental and technical reasons. (even more on fundamental)

Some brief info on GTCB:
"GTC Biotherapeutics, Inc. (GTC) engages in the development and production, of human therapeutic proteins. It focuses on recombinant forms of proteins derived from human blood plasma by the use of transgenic technology. The company’s primary product candidate, ATryn®, a recombinant form of human antithrombin, is undergoing review for market authorization in Europe. GTC also develops rhA, a recombinant human albumin; rhAAT, a recombinant form of human alpha-1 antitrypsin; a malaria vaccine; and an agonistic antibody. The company is headquartered in Framingham, Massachusetts."

The approval for ATryn isn't just the approval of a product, but the approval of a whole new technique. When approval comes it will be major news with quite some impact.
Last April the EMEA didn't approve ATryn, but instead asked some more questions about the technique. The answers were filed in July, and approval is expected somewhere in the coming months. (my guess is late september/start October)

Let's look at the chart:

I already traded this baby before; from 1,18 to 1,39 and from 1,45 to 1,78.
Right now I'm back in at 1,92 (not a really good entry) as I have confidence from the fundamentals and from the chart. And of course, I wouldn't want to miss the big action when approval comes!

In the chart we can see the nice big white candle with volume well above average, and a consolidation phase with declining volume. This is bullish and that's why I don't want to risk to miss the action.

Thinking fast; Mindspeed (MSPD)

I bought MSPD last week (August 18) at 1,67
I really liked the chart; Big white candle on high volume followed by a consolidation period on declining volume, followed by another white candle. (more on this pattern later on)

Wednesday MSPD reached a high of 1,92 on volume above average. At the end of the day it went back down to 1,76 however, closing below the short time resistance of 1,81. The volume wasn't as high as the previous times, so this all was a good sign of fading momentum. Yesterday the stock again rose quit a bit, closing near the high of the day at 1,95. It was on lower volume however than the day before, and declining volume in an uptrend is not a good sign. With the stock reaching the 200MA resistance and oversold territory I don't feel confident, and decided to get out with a profit while I can.
Remember: "When in doubt, stay out"

Here's the chart:

Welcome

Welcome on this blog!
On this blog I will post my experiences and learned lessons in the stock market.
When I started trading I found it very usefull to read the experiences from other traders.
I will be very open en honest; besides my victories you will be able to read my numerous mistakes and the lessons to be learned from them :)

So what kind of trader am I? I'm what you'd call a 'swing trader': I'm using TA to pick my trades, and aim for a short term win. Most of the time I know nothing or very little about the company I'm trading. I sometimes don't even know the name, just the stockname!

I will conclude my first posting with a very valuable lesson I learned from 'Reminescences of a Stock Operator'. "It's not about making or losing money in the stock market, it's about being right or wrong. "
This lesson makes me able to take a loss with a smile.