They say that standing on the side and not trading is one difficult thing for a trader. And that’s what I did today!
Last Friday, I thought that once the bailout will pass, market will rally on Monday and so will ABK and it will make me rich. Guess what? Today, market tanked and so did ABK. I was watching chat room for some alerts but none of the alert looked compelling enough to jump in. And I had decided in the morning that if I am not 100% sure, I won’t trade. Also, stock prices were going nowhere. I think it was a good idea to just stand on the side and watch market find its own way.
From last Friday, I was holding ABK and CSK. ABK gaped down big in the morning from 3.27 to 2.84. Later on it moved little above 3$ and hit low of 2.76. Luckily, towards the end of the day, it ralleyed again closing at solid 3.05. I was pleasantly surprised that ABK kept holding up even though Dow went less than 10k and all other stocks were falling. I think I am going to hold some more and see if I can recover my money tomorrow.
CSK moved from its opening price of 0.17 to 0.19, still below my entry price of 0.23. I think I will wait on this one.
It is important to note that the ban on short selling of financial stocks will be lifted on Thursday. From what happened today, I think it’s quite possible that financial stocks will get beaten up hard on Thursday. I will get out of ABK by Wednesday even if I have to take a loss. It would be foolish to try to fight the short selling onslaught which will be unraveled on Thursday.
Let’s see what tomorrow brings.
Happy Trading!
RJ.
Status as of Oct 6th:
Positions Traded For Gain: None
Positions Traded for Loss: None
Open positions: ABK (LONG 250 @ 3.68$), CSK (LONG 200 @ 0.23)
3 responses so far ↓
1 Nirav Lakhani // Oct 7, 2008 at 10:48 pm
Good call on ABK. It is way too general market to try and play at the moment. Keep up with the pump and dumps from TIM and Muddy, and you’ll steer clear of the general market mayhem that has consumed America!
Best.
2 YngvaiMalmsteve // Oct 7, 2008 at 11:56 pm
Sometimes the best trades are the ones you don’t do. Sometimes it’s smart to sit on the sidelines.
3 RJ // Oct 8, 2008 at 12:30 am
Nirav,
I don’t know if ABK was a good call. ABK went from high of 3.40 to 2.50. Approaching the 52 week low of 1.04. Let’s see how it goes.
Leave a Comment