Weekly Thought on $CARA, $IBIO

This is definitely the week of hit and miss.

A good analogy would be like you turned down an outdoor picnic party ’cause you expected rain to come.  Guess what, rain did come but it was only light shower but the party was a roaring success with everyone having a great times.

And that was what happened to me this week. Monday looked bearish during the day and I started liquidating my positions to raise cash; but by day end market bounced back so I bought back $CARA and $DMRC. Tuesday was bullish and I added to $CARA and $DMRC and also bought a stock called $NAK to trade but I did it all wrong. While my timing on entries were good, my exiting strategies needed to be tuned a bit more. Knowing my Tuesday entry on $NAK was kind of late since price has already soared from a buck to near $3 over a three months period. Yet I did not considered taking the profit that was presented to me on at market close after my entry in Tuesday morning.  It would have been a great day-trading profit on the get go if I had taken profit.  Somehow  my old habit of thinking long-term  came into my mindset when I learned more about the fundamental story. Little did I know, I bought into a possible interim top of the three month rally. On Wednesday morning, price traded down from the open and dropped quite quickly to the $2.7x before bouncing back up. Since I wanted to keep as much profit as possible I immediately sold my position at the open; however, after seeing price dropped so quickly to the $2.7x area, I bought back my position with a much lower average cost which allowed me to recapture my  previous day gain IF I had taken profit before the close. Basically, market gave me two opportunities to lock in gain at the close and I didn’t take it.  Then on Thursday, price opened lower again so I just sold my position immediately.  So, with all the back & forth, in-and-out, I ended up breaking even on the trade.

Lesson from above: if I am entering into an upward momentum of a stock that has been rallied for awhile, don’t be shy to take day-trading profit if it is a made available on the same day.

On Thursday, SP500 formed a small red spinning top candlestick bar; because of this, I saw a possible correction on Friday. Thus, I sold $CARA on Thursday to lock in gain; but that was a mistake on my part ’cause I didn’t think it thoroughly enough. What I overlooked is that $CARA’s I.V. CR845 – Uremic Pruritus trial has a topline readout in Q1, 2017.  Well quarter one means January to March and January is almost over; so the odd of topline readout in February is quite high, IMHO.  So, with the topline readout in the vicinity, there may be continuing demand for the stock for those who believe the trial is going to be a success.  I, for one, believe the trial will be a success and Cara Therapeutics will be the only company that has the therapeutic drug to improve the quality of life for those suffering from uremic pruritus. Thus, without question, I bought back $CARA on Friday regardless of how I feel about the general market correction to come.

Lesson from above: it is time to stop trading $CARA and just hold the stock thru coming volatility just so I’m on board of the ship when topline readout is released. Regardless of my own belief about $CARA, this is still a bet. But I like the risk/reward ratio and is only betting what I’m willing to lose.

Chartwise, $CARA weekly chart reflected a breakout in the Cup & Handle breakout pattern.

cara_weeklyBasically, the week closed higher than the rim of the cup which is very bullish especially when the cup was formed on a weekly chart that spanned over a year.  If this I.V. CR845 – Uremic Pruritus trial is a success, price can easily make new high, IMHO.

Another I traded this week but missed out profit opportunity was $HMNY.  I was quite excited about loading up $HMNY on Wednesday since I believed the bottom was in.  But then on Thursday, my “bad feeling” about the weak bull prompted me to liquidate all my position except $IBIO.  Since $HMNY has a very tiny float, I made sure I got out ’cause I can literally be “stuck” if volume disappears on bad market days. Turned out my concern was all for naught ’cause not only did the market not fall hard on Friday $HMNY actually rallied on Friday. Oop! Another missed opportunity that was so close to my grasp…

Lesson from above: playing safe has its cost; but the cost is well worth it if the alternative can be very ugly.

From the weekly chart below, $IBIO is forming a base here at 40 cents.

ibio_weeklyI’ve a good feeling that this seed is beginning to sprout. It is quite exciting to watch your seed sprout and then growing to become a tree. What will be even more exciting is the possibility of this seed to grow as quickly as the magical beanstalk.  Wow! that will be quite a sight.  Watch the video again:

Despite missing two profit opportunities from $NAK and $HMNY, my port gained back some for the week thanks to $CARA.

Current positions:

Main port (no margin): IBIO   CARA  and 64% cash. (up 7.6% YTD)

Trading port (with margin): MENXF  IBIO  &  GRWG

My 2 cents

From my camera:


Categories: Daily trading Journal, trading journal

Tags: , ,

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