Real-Time Comments on MPPP Uptrend Continuation

Real-Time Training on MPPP Comments

[12:35] <@Threei>  I want to show you recent trade on MPPP
[12:35] <@Threei>  please open http://www.realitytrader.com/calls/mppp.htm
[12:35] <@Threei>  This is my favorite type of movement
[12:36] <@Threei>  and when market is back to this type of moves
[12:36] <@Threei>  we will be rewarded greatly for all the tortures of current situation.
[12:36] <@Threei>  We called this calls Blast from the past
[12:37] <@Threei>  because that's how stocks were actine 1 year ago.
[12:37] <@Threei>  Strong uptrend on small stock,
[12:37] <@Threei>  making it double or tripple during 1 trading session.
[12:38] <@Threei>  Let's get prepared to the method of reading of this kind of movements - bear market is with us in full force but brighter times will come.
[12:39] <@Threei>  MPPP had strong resistance on previous day at 6 1/2
[12:40] <@Threei>  and that's why I picked this price level as indication of breakout.
[12:40] <@Threei>  Stock made couple of movements in very tight range
[12:40] <@Threei>  between 1/4 and 1/2
[12:41] <@Threei>  and sellers at 1/2 got taken out on good steady buying.
[12:41] <@Threei>  6 9/16 was the level to buy
[12:41] <@Threei>  with stop at 1/4.
[12:42] <@Threei>  1/4 was strong support and stock shouldn't hit it if uptrend is confirmed,
[12:42] <@Threei>  that's why I picked it as stop level.
[12:43] <@Threei>  After some churning it took out the wall of sellers at 7
[12:43] <@Threei>  and we sold half of position there.
[12:43] <@Threei>  As long as stock stayed above 7
[12:43] <@Threei>  it was OK to hold
[12:44] <@Threei>  because old resistance became new support
[12:44] <@Threei>  and only breakdown under 7 with increasing selling wqould have indicated the end of uptrend.
[12:45] <@Threei>  It made couple small swings between 7 and 7 1/2
[12:45] <@Threei>  and took out 1/2 barrier on huge volume.
[12:45] <@Threei>  Look at volume spike in lower part of the chart.
[12:46] <@Threei>  Spike to 8 was real furious
[12:46] <@Threei>  and we sold another half right under 8, at 7 15/16.
[12:46] <@Threei>  As you can see,
[12:47] <@Threei>  stock made small pause and went to 8 3/4.
[12:47] <@Threei>  Well, this part of the move was unreadable by me.
[12:47] <@Threei>  Two reasons:
[12:48] <@Threei>  1. Such a surge in price and volume as we saw at 12 - 12:05
[12:48] <@Threei>  is usually signal to get out.
[12:48] <@Threei>  2. It's been a long while since stocks made such a movements
[12:49] <@Threei>  and it was really hard to believe MPPP is still capable to go higher.
[12:50] <@Threei>  After some churning around 8 1/2
[12:51] <@Threei>  volume dried up
[12:51] <@Threei>  and I made a comment:
[12:51] <@Threei>  11/16/00 <Threei> now it's a play on bounces from bottoms
[12:51] <@Threei>  11/16/00 <Threei> I would expect the highest probability of next bottom from just under 8
[12:52] <@Threei>  Look at chart at 12:40 approximately:
[12:52] <@Threei>  stock made a dive under 8
[12:52] <@Threei>  and volume spike
[12:52] <@Threei>  which market the bottom of pullback.
[12:52] <@Threei>  marked.
[12:53] <@Threei>  7 15/16 was the buy price
[12:53] <@Threei>  and the sell was called at 8 3/8.
[12:53] <@Threei>  Why?
[12:54] <@Threei>  I did not believe MPPP still has a room to go for that day,
[12:54] <@Threei>  because that spike to 8 3/4 was too fast, too biig.
[12:54] <@Threei>  8 1/2 was the level MPPP tried to make up its mind at after that spike
[12:55] <@Threei>  and decided it wants to go down.
[12:55] <@Threei>  So, naturally,
[12:55] <@Threei>  8 1/2 became resistance level now
[12:55] <@Threei>  and 8 3/8 was logical exit point.
[12:56] <@Threei>  It took MPPP about 1 1/2 hour of congestion around 1/2 later
[12:56] <@Threei>  to overcome this resistance again
[12:56] <@Threei>  and spike over 9 at 14:30
[12:57] <@Threei>  after which it went to 8 1/2 again.
[12:57] <@Chris>  To send questions for the Instructor, please doubleclick
on the name Larisa and she will post your question for you after training is over.
[12:57] <@Threei>  Some lessons of this movement.
[12:58] <@Threei>  1. Trend is the best thing you can get from market.
[12:58] <@Threei>  When you have a trend,
[12:58] <@Threei>  everything becomes easy:
[12:58] <@Threei>  easy to find entry points,
[12:59] <@Threei>  because you are not restricted that tight and not obliged to buy exact reversal point.
[13:00] <@Threei>  Trend like powerful flow will take your position in right direction.
[13:00] <@Threei>  It becomes easy to sell
[13:00] <@Threei>  because underlying strength creates good cushion for you
[13:00] <@Threei>  and because buyers are willing to take the shares out of your hands.
[13:01] <@Threei>  You have clear direction
[13:01] <@Threei>  and you just go with it.
[13:01] <@Threei>  When this kind of movements is back,
[13:02] <@Threei>  you will have the only question:
[13:02] <@Threei>  how to get the most out of it?
[13:02] <@Threei>  We have tactics that allow you to get as much as possible out of strong trend
[13:03] <@Threei>  I will describe them briefly now and we will go into deeper details when it becomes hot matter.
[13:03] <@Threei>  One of tricks I love:
[13:04] <@Threei>  As soon as strong uptrend on small stock with good volume is identified,
[13:04] <@Threei>  I buy DOUBLE lot.
[13:04] <@Threei>  I buy 2K instead of usual 1K.
[13:05] <@Threei>  First lot I trade like I always do,
[13:05] <@Threei>  in a manner you saw with MPPP calls.
[13:05] <@Threei>  I sell it, rebuy it...
[13:05] <@Threei>  And another lot is just to hold
[13:05] <@Threei>  until one of two things happens:
[13:06] <@Threei>  1. Stock goes up ridiculously
[13:06] <@Threei>  like $4 stock to $12
[13:06] <@Threei>  and I just can't stand it anymore.
[13:06] <@Threei>  2. Stock shows signs of uptrend being broken,
[13:07] <@Threei>  establishing lower highs and lows.
[13:07] <@Threei>  After I sold second lot, I usually give the stock a rest
[13:08] <@Threei>  and get back to it closer to end of day
[13:08] <@Threei>  when buyers for gap provide new opportunities.
[13:09] <@Threei>  Trying to answer in advance question that I think might be asked:
[13:09] <@Threei>  why I picked point just under 8 as a reversal point while stock was around 8 1/2.
[13:09] <@Threei>  I have a pretty good answer:
[13:09] <@Threei>  I don't know
[13:09] <@Threei>  :)
[13:10] <@Threei>  There are things that come to you with experience...
[13:10] <@Threei>  it just felt like that.
[13:10] <@Threei>  I wanted to show you how brighter times would look
[13:11] <@Threei>  when we get there
[13:11] <@Threei>  and I hope that it helped to get more patient in this grim environment we trade cirrently in.