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Trade Management

Trading is not an easy task.

Successful Trading requires using Technical Analysis to find high-probability trades; developing one's own Trading Strategies for entries and exits; patience in Managing the Trades; and being conservative with Account Management in order to prevent big drawdowns that can cripple a trader's account and his/her career as a trader.

So far, Technical Analysis has proven itself an invaluable tool in the past few years particularly buying the bottoms of Feb 2010; July and August 2011; and Oct, Nov, and Dec, 2011 for Swing Trades. Also, lately, I embarked more on Day-Trades buying the bottoms of June and July, 2012 (see Instablogs of those trades in the past).

Now is the time to employ Technical Analysis again to find high-probabilities of unloading some, if not all, of the Swing Trades and/or the Day-Trades:

- Weekly:

- Daily:

The Weekly Chart clearly indicates Major Fibonacci Confluence Resistances while the Daily Chart is either in the process of executing the Final Rally OR will still mess around with an a-b-c Flat that could result in a lower low below 1430.50 (or worse)


Trade Management Techniques:

The objective now is to start taking some profits on the SSO Day-Trades (bought in June and July bottoms). So I will be selling 1/3-rd either today or Monday in order not to suffer a possible c-wave down (or worse outcome).

Another 1/3 will be sold at or near the Weekly Chart Major Resistance of 1481/83. The last 1/3 will become a 'Free Trade' using Trailing Stops with the 1422 to be used as a Major Support.

Will keep holding the remaining 1/3-rd or SSO Swing Trades bought in Oct, Nov, and Dec, 2011 bottoms.

Account Management

I am 130% Longs right now increasing the load from the 120% since the last Instablog. I made new trades with AAPL (last Tuesday) and Intel (yesterday). See my latest Comments regarding TA for AAPL and Intel. These last trades are to be considered very risky since presumably the SnP500 can start, sooner rather than later, either a large pullback that can lead to a correction of more than 20% OR possibly, however remote, a Prolonged Secular Bear Market Correction. So, I am using very tight Trailing Stops on the last two to prevent possible loses right now (unless of course if they gap down - which will definitely trigger the Trailing Stops at well below their current levels). Will try to reduce long positions to 100% (90% Portfolio + 10% Swing Trade) as SnP500 approaches the Major Fibonacci Resistances.

* For the INTL Trade: I will simply use Trailing Stops and not sell it since the upside targets can take a very long time to accomplish (assuming SnP500 goes into an Extended 5th-wave Rally). Equal Move Target is $32.28 using the Daily Chart but will keep yesterday's buy as a possible Long-term Hold if Intel just keeps rallying in the next several months to several years - for as long as the Trailing Stops can survive without being triggered.

* Also started buyingShanghai Index for the past few weeks as possible Long-term Hold - using the CAF ETF. See my Comments a few weeks ago for long-term analysis of Shanghai Index Monthly Chart. CAF Divergence Buy Signals triggered 3 weeks ago using MACD Indicator. Shanghai Index should trigger next week as this whole week is a holiday.