During this upcoming week, I'm going to be creating a position sizing calculator which will function in Google Sheets. The calculator will allow you to quickly figure an accurate position size based on your personal account value as well as your personal risk tolerance. I'm hoping to have it up and ready by Wednesday or Thursday. During this last week, I realized that Trade Anatomy needs to be more about trade idea generation and less about portfolio management. For me it's hard to separate the two and realize that most subscribers are not going to take each and every idea posted. Instead, they analyze and review the ideas presented and then choose the ones they are most comfortable with taking. Since this is the case, it's important that I focus the attention of Trade Anatomy on providing sound trading advice for each trade idea based on the stocks technical picture and not the overall market. Going forward each trade will be made at a .50% risk model which will help simplify position sizing and tracking. Because the site is still fairly new, gradual evolution is necessary to make Trade Anatomy efficient and effective for it's users.
Trade Summary for the Week
We had 3 new trades ideas for the week. The first was ASC and the second was XON. FLTX was initiated on Friday. We posted ASC with an initial entry at 12.84 risking .45% and an initial stop loss at 11.77. Using these numbers for position sizing, you would have allocated 5.40% of your trading capital to ASC. XON had an initial entry at 53.61 risking .50% and an initial stop of 47. We allocated 4.06% to this trade. FLTX was posted with and initial entry at 49.35 risking .50% and an initial stop loss at 45.28. 6.20% was allocated to this trade based on the above numbers.
Portfolio Trade Ideas
With the 3 new trades from this last week that brings us up to 11 stocks that we are following. Many blew out to new highs, and quite honestly left most traders a little shell shocked, me included. I would expect some consolidation this coming week, but that's never a given. On Friday, 2 of the new trades for up over 6%. While we only caught half of the FLTX move, we got the entire benefit of ASC which was up over 7%. Many of the petroleum shippers continue to have strong trending patterns, and ASC is starting to participate with the group. Below are the charts for further review. I've changed the layout to enable quick viewing of all the charts. Simply click the upper left chart and an enlarged chart will appear on your screen. You can then use the right arrow to visually scroll through each chart.
The watchlist has now increased to 22 names. Several stocks have started trending, but trade ideas won't be generated until consolidation occurs. MDXG, MBLY, BEAT, STNG, ANIP, VLRS, AJRD, and ENTA are just a few of the names that are worth watching right now. On Monday, the watchlist will be updated with new stocks added to the list. AJRD seems to interest me a lot, mainly because the resistance levels date back all the way to 1987. That makes for one huge chart pattern on the monthly. The key to finding big winners is to find big patterns on the weekly or monthly charts, preferably price patterns that have taken 2-5 years to develop. You'll notice that when you look through the watchlist, most will have large patterns that have taken several years to develop. Remember big trends start with big basing patterns. Below are a few charts from the watchlist.