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Saturday, March 05, 2011

12.35 am : DOW down 50 points. Crude oil staying above USD100.


LionInd : RSI at 20.5. Looking at 1.53 and 1.38 level. Please read to know WHY it is diving. And do you think she will recover? Back to RM2? It might show some technical rebound next week, but this is a sharp knife which I wont touch for the time being.

Hypothetically, I could plan it this way.

Buyings

Stage 1 : buy at RM1.60 level. Say, 2k units. So, RM3,200.
Stage 2 : buy at RM1.50 level. Say, 2k units. So, RM 3,000
Stage 3 : buy at RM1.40 level. Say, 2k units. So, RM2,800.

Total investment : RM9,000.

So, today ... assuming I have bought her at RM1.60 done. I am holding 2k units of her. Date today = 4th Mac 2011.

Sellings : Every twenty cents up, SELL.

Let us see how much I will gain/loss if I m using this no-brainer way of trading her.

Note : Do read my previous post on her. I have collected her at RM2, RM1.90 and RM1.80 ... and managed to sell her at RM2, RM2.10 and final batch at RM2.20. It works well!!

TEH

1 comment:

CL said...

Averaging down sounds risky to me,though potentially quite profitable. What if the stock price continues to drop after your stage 3?

A dangerous thing to do is to suddenly change your plan in the mid way. For example, instead of cut loss at your 3 percent stop loss level you decide to average down when the price drops 8 percent.