Stage Analysis Video Training Course

Stop Loss Positioning Guide - Page 9

#65

RE: Stop Loss Positioning Guide

Thank you so much, you do not have any idea how much you help with your postings. I have so much to learn from all of you.

Looking forward to more posting on this subject from you.

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#66

RE: Stop Loss Positioning Guide

ISA, please let me know if I'm going to abuse your generosity.  

This is the graph for NVDA, for a trader, based on the book, would a stop at 202 be correct?  On the investor side of things, if I understand it right, the stop should be around $180, is it too much of a value fluctuation? 

Also I have hard time finding a sector related to my stock, do you have any site that I can look it up?  

On a side note, I'm reading your journal, very interesting stuff there. I have several questions but I will post it later on on the right post.  

In the meantime, how does you psychological "greed" factor work for you when you are debating between, I'm making some profit here, is some major event let me lose everything I build or keep going?    I was reading about FB on your journal, you purchased it around $45 on 3003, not sure if you sold it but that must have been a nerve breakdown for you, especially when is now at 200.  I had the same problem with Amazon, I always regret selling it at 300 :-(  
Please feel free to give me/us any input you may have.  I will follow up with more stocks if you do not mind later on.

Thanks



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#67

RE: Stop Loss Positioning Guide

(2019-12-11, 05:06 PM)alphatech Wrote: ISA, please let me know if I'm going to abuse your generosity.  

This is the graph for NVDA, for a trader, based on the book, would a stop at 202 be correct?  On the investor side of things, if I understand it right, the stop should be around $180, is it too much of a value fluctuation? 

Also I have hard time finding a sector related to my stock, do you have any site that I can look it up?  

Thanks

Hi alphatech,

202 would be a bit tight still considering where it is currently as the most recent swing low was at 200.37. So ideally you'd want to be below that, and a whole number as well as the 50 day MA for a trader stop to give it enough room so that you are not shaken out of the position. However, as you can see on the daily chart there is a fairly close support level from the April high in the low 190s range, and so there's a chance of pullback to towards that level to consider also as we often see in the early part of Stage 2 in stocks with low volume breakouts.

The investor stop would ideally be below most recent significant low prior to the Stage 2 breakout and the 30 week MA. So the swing low was at 169.20, and so imo the initial investor stop would have been below a whole number at around 164.9 to give it a bit of room below the low and 30 week MA. That stop position would not yet have been raised, as it has not yet made a fresh breakout to new highs following the recent pullback. But if it does, then the investor stop loss would have its first raise, but it would remain below the 30 week MA and recent swing low. So it would be at around 175 ish currently. As the 30 week MA is at 176.53 as of today.

So is that too much of value fluctuation. I calculate this in my picks by using a volatility based method using the Average True Range. This is something I've developed myself, and I use 2 times the 52 week Average True Range (ATR) for this, to determine if a stock is too extended from it's stop loss position. So in this case the current 52 week ATR is at 14.021, and so 2x the 52 week ATR would be 28.042.

So to calculate you do

(current price) - (2x the 52 week ATR) = max risk

216 - 28.042 = 187.95

Therefore 187.95 would be my maximum possible stop loss position. However, this is way above the 165 level that mentioned the stop loss should be at. And hence I would pass on the trade based on that, as it's too extended if the stop loss position is below my maximum risk. This is only my opinion though, as I've set that risk level for myself.

NVDA is in Technology and its sub sector is Semiconductors. You can find the all of the US stocks sectors on stockcharts here: https://stockcharts.com/freecharts/indus...l#&t=T&O=1 Just click the each sector name and you'll see the individual stocks.

       

isatrader

Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.
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#68
(This post was last modified: 2019-12-13, 08:51 PM by alphatech.)

RE: Stop Loss Positioning Guide

Not sure if PEP is entering stage 3 or still on stage 2.  How can I really determine if the SMA30 is getting flat here?

Would the stop be at $130.87?
The MRS is getting negative, it should be a sign to sell it at the value above of $130.87?

Thanks



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#69

RE: Stop Loss Positioning Guide

(2019-12-13, 08:50 PM)alphatech Wrote: Not sure if PEP is entering stage 3 or still on stage 2.  How can I really determine if the SMA30 is getting flat here?

Would the stop be at $130.87?
The MRS is getting negative, it should be a sign to sell it at the value above of $130.87?

Thanks

Hi alphatech.

The PEP chart looks to be still in Stage 2B currently imo, which is considered late in the uptrend, as it's been in Stage 2 for nine months now, and has had two significant pullbacks towards the rising 30 week MA. Some people may argue that it's in early Stage 3, which is know as Stage 3A, as the most recent pullback to the 30 week MA went below it, and the 30 week MAs momentum has slowed, and is now rising more slowly than it has been through the Stage 2 advance. But either way, there's very little difference between the two sub stages of Stage 2B and Stage 3A, as with both you should be considering tightening your stop loss position, and potentially taking some profits if you've been in since the beginning of the Stage 2 advance.

I've marked up the weekly chart with where I think the investor stop losses should have gone, and although the price hasn't reached the previous high yet. It is close to it, and the combination with the loss of momentum in the stock while the broad market is breaking out strongly to new highs suggests more caution imo. And so I would raise investor stop early, as of this weeks close, to under the recent swing low just under 130. So probably at around 128.90 to give it a bit of room below the swing low and a whole number.

   

isatrader

Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.
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#70

RE: Stop Loss Positioning Guide

I decided to buy Gold ETF IAU.  I put the stop at 15.03.  Is that the right stop?  It sounds to be that it is at stage 2 correct?



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#71

RE: Stop Loss Positioning Guide

(2020-03-09, 07:37 PM)alphatech Wrote: I decided to buy Gold ETF IAU.  I put the stop at 15.03.  Is that the right stop?  It sounds to be that it is at stage 2 correct?

Hi Alphatec
Sure is in a stage 2, has been since June 2019 so quite advanced. The green line shows where the stage 2 entry was
stop is dependent on investor vs trader
the blue line, under the 30sma is where the investor stop should be
the red line under the lower of the 10sma or the low, where the trader stop should be

good luck!



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#72

RE: Example #1 - Abbott Laboratories (ABT)

Hi  ,   isa   , you did a  Great work !  
          
  In  Example #1 - Abbott Laboratories (ABT) ,  i understand  investor's and trader's stop from your descrtion . but  i am confused by Atr distance to stops   .  
"   
 For ABT the ATR(200) was 0.809 at the time of the recommendation and so:
1.87% to 3.10% ATR - Trader stop range
3.72% to 4.96% ATR - Investor stop range  
"  
   how do you get 
  "1.87% to 3.10% ATR - Trader stop range
 3.72% to 4.96% ATR - Investor stop range  
 
 could you give me more detailed information about this ?

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