Weekly Thought on $CARA, $IBIO, $PI

Wow! What’s a roller coaster week!

It’s been awhile since I rode a roller coaster, and I’m not feeling quite right afterward.

Need to catch my breath…

Whewwww!

“What roller coaster?”

Mainly $AMRN.

I began to build a position on $AMRN early in the week before earnings ’cause I believed they would have good numbers due to rising weekly script numbers as well as increasing market shares against the generic.  But the price rise was short-lived on Tuesday after morning earnings announcement but I still felt confident to hold out.  Wednesday failure to maintain gain was heat that I could tolerate. However, when Thursday waterfall began, I began to see it as an opportunity to buy more since there are supports at the daily 79 & 89 MA at the $3.15 level.  I used the stair-step method of picking up more shares at each lower level with a final buy stop at $3.15.  I got filled on all levels and was thrilled to see the bounce in price.  Just like those who was thrilled (and scared at the same time) over the “falling sensation” in the roller coaster downward momentum, the exhilaration of the sudden upward momentum provided equal thrill and enjoyment. Just like that, I succeeded in lowering my average cost and was back in the black after the morning bounce.  What I forgot to notice after the morning buying campaign was that I was way over-weighted on $AMRN.  Due to this oversight, I didn’t reduce my position size back to where I wanted and still maintained the lower average price when price bounced back up on Thursday morning.  Obviously, my greed had a lot to do with this oversight.  But Thursday event was not over yet.  By late trading day, price began another waterfall again.  Only this time, I was like a deer facing the headlight.  “What’s the h*ll?” was all I could muster while my fingers were no where near the keyboard to get out.

I also noticed that the late day waterfall was not a single event tailored to $AMRN, other stocks like $PI, $CERS, and $CARA were all falling on late trading day. Apparently, there were political turmoil that could derail President Trump’s new economical programs. Everything went down on Thursday.

Obviously, I found myself looking like an idiot holding way too much stocks in my port facing the prospect of severe market reaction on Friday if the political turmoil was not resolved.  I was already loaded up on $PI and had an unexpected over-weighted position on $AMRN due to buying on the morning drop.  I was like the guy experiencing his first roller-coaster ride screaming, “I’m going to die!” during the speedy fall and had resolved to let “fate” determine whether I would survive or not.  I would accept whatever damage I incurred as long as I survived.  Luckily, I did not fall off the roller-coaster and it actually came back to my entry point which I felt tremendous relief. Just like when the roller-coaster came back to the end of the ride, the sick-stricken first time rider who had not learned to appreciate the thrill would want to yell “get me out of here!”

I felt exactly that way so I immediately departed $AMRN once price rebounded near my entry point Friday morning.  I did not even wait for it to go higher since I’d no way of knowing it would go higher for me to get out with a profit.  I was just happy to climb out of the roller-coaster with my arms and legs intact.

Whewwww!

Yes, after many years of trading, I’m still not immune to the deer at the headlight syndrome. Sure, there would be moment I could just “get the hell out now before finding out the reason for the fall” but there would also be moment when I became the deer facing the headlight.  I only wish that weak moment like this do not happen too often.

There, there, I’m not perfect.  As an investor/trader, I could only do the best I could. Of course, documenting my trading experience here also serve as a reminder to help reduce repeating the same mistake again.

Although I’m out of $AMRN for now, I’ll watch the price action to determine when is the best time to get back in.

This week still ended on a good note since the three stocks I’ve high hope on are still in good shape- $IBIO, $PI, and $CARA.

Although $CARA also suffered later on Thursday by giving back most of the gain after breaking out $18, it did not bother me as $AMRN had ’cause I did not load up to swing for the fences in the morning.  I only have my core position to bet on the pruritus trial outcome that is going to be announced between coming Monday and end of March.  However, after being “spooked” by $AMRN on Thursday, I decided to reduce my core position by 30% near the close on Friday just so I can catch my breath. I may buy back the 30% on Monday when I’m back in aggressive mode.

cara_weekly

The weekly chart above reflected a very strong confidence on the stock. It also supports the continuing trend of upward momentum after the Cup and Handle breakout was achieved (see shaded yellow rectangular box).  Next target is $23.61 which was the previous high from mid-August, 2015. Of course, despite the chart outlook the REAL catalyst for the uptrend will depend on the pruritus trial result.  No matter how confident we are on the result, we should never take our speculative risk for granted. Hence, my reduced core position size during my moment of weakness.

I like $PI for its RAIN RFID concept and I believe it will have a great future ahead. But I still need to respect the risk I’m taking.  I was at the borderline of swinging-for-the-fences position size on $PI going into Thursday. By Friday, I reduced my position size to medium size (between standard and swing-for-the-fences) just to play safe  over the weekend.  If nothing bad happen and the market becomes bullish once again, I’ll buy back what I sold because I believe $PI is waiting to bounce.

pi_weekly

From the weekly chart above, although a down week, price continued to bounce off the Fib 61.8% retracement level but with a lower volume and smaller trading range.  This can be a recipe for a possible bottoming.  We will find out what happen on Monday.

$IBIO continues to look good.

ibio_weekly

From the weekly chart, volume is higher and price also advanced a bit higher. Momentum indicators are turning up and the 5 MA line is slowly inclining upward. Now we just wait for the 15 MA to turn upward to support a bottoming process. While I only have my own belief on this stock to rely on to sustain my bullish sentiment, I’m willing to bet big on this one.  To me, this is a one-in-a-lifetime investment opportunity if Dr. Carol A. Feghali-Bostwick is proven right. Furthermore, I also believe in the plant-based economical production of therapeutic vaccine or any bio-medicine.  Once it becomes relevant, this one will fly like no others.  Meanwhile, IMHO, it is a sleeping dragon. Watch the video again:

For the week, thanks to the recovering rally of the stocks I own, I’m up slightly.

Current positions:

Main port (no margin): IBIO  PI  CARA and 61% cash. (up 6.7% YTD)

Trading port (with margin): MENXF IBIO & GRWG

My 2 cents

From my camera:

pink-flowers

 

 



Categories: Daily trading Journal, trading journal, Trading philosophies and thoughts

Tags: , , ,

2 replies

  1. Zen: I have a ‘head’ problem and Id value your thoughts. Lets say I bought two lots of $ABC….the first 100 at $1 the second 100 at $2. Both the avg and sp is now $1.5. For whatever reasons, I decide to sell 1/2 at $1.50. My broker seems to hold these two as seperate parcels rather than amalgomated, and presets sells on a FIFO basis. This means my cash is now up 100 x 0.5 but Im left holding 100 stock at $2 when the market is $1.50. Psychologically, if I sell for less than $2, Im selling the second lot at a 0.5 loss which depresses me…..but of course if I allow for the earlier 0.5 cash gain, its a wash.
    So my question is: are you overall measuring the +/- net value of your portf, or the +/- of each trade individually? Mixing the two is screwing my head.

    • Runningrep, I don’t focus too much on the trees but more on the forest.

      An easy way is to look at your portfolio as if you’re looking at the forest. This mean I can do anything I want with the trees. My goal is to expand the forest. I don’t care which trees are doing the expansion as long as I’ve trees that are expanding. Do what you will with the trees as long as you are cutting off the bad ones, encouraging the growing ones, or trying out new trees. Don’t bog down on how many trees you cut or how many you added as long as what you’re doing is encouraging the growth of the forest.

      I hold no loyalty to the trees unless they perform like I expected them to. I hold loyalty to my forest. That is where I put my focus on. That is why I constantly going in-and-out of my stock positions. It’s all for the purpose of protecting my forest.

      There will always be trees for you to pick. Just remember to throw away the bad ones and always keep your eyes open for the good ones. Sometimes you will end up cutting the bad ones too late but you will have days when the good trees are growing by leaps and bounds to more than cover the bad ones. That is all I care about.

      As long as your forest is growing, who care which trees are doing the jobs as long as the job is getting done.

      Hope it answers your question.
      Z

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: