Tuesday, 1 June 2010

Amazingly volatility

Shocking volatility today. At one point I had in probability 500 worth of profit sitting on the table. Unfortunately left it all sitting on the table and actually recorded a loss at the end of the evening. I broke (not for the first time) the prime rule - my rule - which is if the profit equals 10% of the fund close the position. The problem with coming out of a position is where do you get back in? I am not a sophisticated enough trader to determine this yet, and I would have got in again and made a bigger loss.
I use this as training - is it right to look at the profits eroding if you think the potential is greater down the line?

Despite this, it looks like the last gasp of an Elliott wave formation and provided the index doesn't collapse overnight we could see a substantial rally within the next week. Funny thing is I was looking at the chart and thinking "I can't see the last portion of the wave" ;-)

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