The Student Loan Ranger

Stood in ahead of size on British Airways (BAY) on excellent volume with good buying presssure. Will wait for the next few minutes to see where we go. Currently 2:1 on buys/sells and expect profit taking to begin at around 630.

Not looking for anything major in this trade because the range is small, just checking that I can apply the strategies of hit and run trading to the UK market. £20 will be enough for me on this one!

Out of the trade, commission and stampt duty killed me on this one. Costs of the trade were £42 against my quick £30 price gain so lost £12 overall. Sell signal was the price crossing under the fast line. Would not be surprised to see the stock bounce off the slow line and maybe I've sold out too early because it's holding on the slow, but these stocks aren't too good for day trading - especially with the costs involved. CFDs would be a lot better for it.

13:48

SOLA now at 616p. A lot of pants on the floor for the rampers.

Off college today so getting some action.

12:00

DES is cooking something up, there's quite a lot of volume in it and it's strong on buys versus sells. It hit what looked like a double top, and I've sold out for a quick £60 profit. The bid price dropped right after I did so it looks like a good move. I'm currently waiting for it to drop for another entry signal, as it might go for a triple bottom and a strong move upwards.

With my money free from that trade, I'm currently watching VPC as it consolidates after a big morning slump, SOLA because it's awesome. I'm also waiting for the US markets to open, so I can try a short term wedge and bounce off EMA on Transocean (RIG) with a price target of around $160.

DES is starting a come back, and we might see some action right about now! Updates to follow.

13:15

DES dropping off, SOLA rocketed before I had a chance. I'm 100% sure there isn't another stock in the world that does this every day:

I'm amazed at the people that buy into this kind of movement after it's been going up so long. If I didn't know this stocks past movements I would be staying well clear. It's topped at 490 as the profit takers have moved in, leaving a lot of people in the doldrums soon I think. A lot of sells at 490.

14:15

Well I don't know if the world is out to get me specifically, but something ALWAYS goes wrong when I want to get into a trade.

I was sitting watching DES and SOLA on L2, both had just triggered buy signals before my L2 stopped working. Shortly after that I couldn't connect to my brokers website, and shortly after that my router stopped working and my internet dropped out. Then my computer crashed.

Suffice to say that DES and SOLA have now both rocketed as I checked the prices on my phone, and I'm stuck writing offline on notepad waiting for my connection to come back. It's Saturday morning syndrome as this is the same kind of thing that happens on Saturday mornings with my internet. When this happens the only sites I can access are google and yahoo - and the speed is about a quarter that of dial-up so you can understand my frustration.

I wonder if it has anything to do with the lazy council workers sitting around smoking fags in the diggers around the corner. It's currently 15:40 and I've been down for about an hour and a half but looks like I'm getting a connection to blogger... ok maybe this will post after all. My brokers website is still not working, which does not surprise me in the slightest.

What I really don't understand is that I can search on Google, Google returns the search results/descriptions/links - but then I can't connect to any of the websites.. how does that work?

22:30

Well just tried again with my computer, and all I can access is blogger, google and the US yahoo website. Very frustrating. Still can't check my broker to place orders, or prorealtime for some set-ups for tomorrow, or any news sites or forums for extra curricular research. Anyway this is what I got earlier in the day when on Quotestream through my broker:

Also from what I can gather, SOLA closed at 520 after I spotted the reversal double bottom at 457. Could have made the easiest £500 of my life but it's over with now so nothing I can do about it. DES seemed to close around 95.5p after dropping to 91.5p which would have been my entry signal.

I'm really not sure what's causing my internet to stop working just when it matters, but I can only assume it is fate. As for tomorrow, I have no set-ups at all to trade because I can't do any research. VPC looked OK earlier, but I have no clue how it did during the day. SOLA and DES could be plays as SOLAs earnings are out tomorrow, and DES is looking to break to new highs if it passes 96p.

Realistically I'm only a trade or two away from being able to open an Interactive Brokers account, so at least I have that to look forward to!

Well as yet I've been unsuccessful in programming the hit and run strategies into prorealtime so I'll leave that and just relax this weekend instead. I am "all-in" DES at the moment. My profits on that will be dependant on an early morning RNS - if there isn't one of these, then I can exit - trade - and get in for more or less the same price later in the day. It would take a very good setup (PET) for me to consider this move, as I don't want to overtrade.

I want to focus on a few interesting plays this week, and less on the traditional pattern spotting and indicator coverage. These are more for the purposes of learning a bit more about what to do when faced with stocks that present large potential gains or large potential losses. The best advice would be to ignore them and find a cleaner set-up, but where's the fun in that?

Dairy Crest (DCG)
This showed up last week on my 'Stochastilicious' filter on prorealtime, but I really wasn't sure about it so left it. In hindsight I missed out big time, but there are a lot of these bottom reversals happening right now. Incidentally, the first burst was the largest range from the past 9 days and the ADX was above 30 - strong "Hit and Run" strategies.

We've seen a bullish few days here - and the indicators point strongly in favour of a continuation - but surely it can't.. can it? The potential to the upside in the short term is about 508 for me, another 7%. This could come on Monday - the signs will be there very early in trading. These moves have been backed up with some obscene volume - which means that at some point in the next few days there will be some serious profit taking. There wasn't any news immediately before, or during this rise. I think this will go up Monday/Tuesday, and as the profit taking commences I then expect this to go down quite fast. My initial target is within a few pence of the trend line or resistance line - but with these indicators I might be wrong, and it could smash clean through and out.


Nighthawk Energy (HAWK)
Another quandry for me here. HAWK has been a stock I always look at, but never buy. It's totally passed me by lately until I consistantly saw it making new highs over the past week. I recall looking at this in late February and naively thinking "this can't go any higher!".

An excellent breakout from a good ascending wedge followed.

General rules for profit taking on an ascending wedge are calculating the distance between first two points, and then project that upwards from the break. We've had the break move, the consolidation, and the move up - and now we are exactly where the technical trader would take profits. HAWKs moves these past few weeks have been unrelenting.

The ADX is smoking hot, and the long term MACD is looking like a ski ramp. The stochastics have been +80 for a while now, but that's having little impact on it's momentum - the signal line for sales doesn't even drop off that low before crossing again. HAWK is finding some good bounce opportunities off the 40 day ema (redline), and is hugging the fast line tight.

What I don't like is the gap up and spinning top right at the profit taking level. But all the TA preachers say follow the trend, and for a stock that has made 8 all time high days from the past 9 - then HAWK is a good move. Even once the stochastics pull back a little, I will watch for a turn for entry.


Petrel Resources (PET)
Had this on my watchlists for about 2 weeks after I thought it might have formed a double bottom at some good support and was ready to go up. It didn't, but I set a price alarm and have watched it move quite well this week.

It's ticked over the alarm, so I've had another look at the prospects of this stock. Despite closing the tiniest fraction under the support/resistance line, PET is probably looking one of the best bets for the coming week. There is no sign yet that Petrel is ready for a strong upward rally or trend reversal - it's sitting in a sideways channel at the moment, which is more or less where I currently expect it to stay - but it's looking very rosy for the short term. The volume isn't high, but there is some good buying pressure.

The last time it moved sharply - there was a lot of volume. People will be watching PET with this in mind, so stepping in ahead of them might allow you to sell into strength as the rest of the traders jump in for a quick buck. The big move last time was provoked by a breakout to the bull side of a short term descending wedge, and while the setup isn't as clean as last time - there is some positivity about their operations in Iraq which is drawing in a few longer term investors at the moment.

On the technical side, stochastics are favourable, ADX is +30, bulls facing up with bears facing down on the DM, MACD showing good divergence and has crossed over. I am excited about this stock next week, and to me it represents the best play.

Realistically, I would look for a move above 92 for entry, with a short term target of 105. My targets are lower than normal here, as the last major high was less than the previous. I would need to see a cover to about half the distance of that high from now (=105) before a pullback then move to the upside. This stock can be news biased so be careful on that front.

ReneSOLA (SOLA)
Well I just had to include SOLA because it's the stock I like to look at most. The intra-day movements are so predictable once you've followed it for a while, that you can literally spot the exact trade it turns on and look at 5% profits within half an hour.

Things are hotting up for this stock as oil prices reach new highs, the dual listed American stock reaches new highs, and they are set to announce reports next week after very strong financial updates throughout the year. It's all about China, and it's all about solar... and oil.

I'll be honest and say I don't have a clue where this is going to go. For the meantime, all I know is that there is resistance at 460 and support at 211 and it has formed a flag. I think this range will continue until results are released, and then I think we might see new highs. This flag is highly significant, seeing as it follows the WM pattern I covered a few posts ago - meaning that this could go down or up, quite fast, quite soon. Not one to buy or sell right now though. Buy and sell signals depend on whether the price breaks out of the flag on the bull side or the bear side.


I might add more stocks on Sunday night if I have the time.

An OK week for predictions, two of the stocks kind of stalled a little. The short term play on JPR was good, and the WTN call was a lot better than I expected! Petrofac and Autonomy look like they could be good stocks when a few technical issues are overcome.

Western Canadian Coal (WTN)

Exceeded all short term price expectations, but still lies below target trend line. I think we might see a recurrence of the bull flag formation that happened last time it rallied. For now, the fun looks over, but I will wait to see what it does in the next few days in terms of support, also watching for continuation or reversal signs.


Johnstone Press (JPR)

Short term scalp worked out pretty much to the book. In and out for a quick 6%. There are still signs that JPR might continue to move up in the channel range, but I'm not interested in this again until it's broken out of the general downward trend, and in the more short term, 150p. For an investor, this could potentially be a good long term play at these prices, after we see some longer term consolidation.

Autonomy (AU.)

This looked like a good play at the start of the week but is increasingly looking grim. The next few trading days are vital here - another movement out of the ascending wedge on the downside might see it crash quite a bit. There are not many good things about formations that I can see. Stochastics are hard to call, MACD is looking OK. A break on the fast line ema might see something worth going for, but it's a purely a watch for me. The worst short term call on this blog for a while

Petrofac (PFC)

Depending on your entry you could have made a few percent here, but not really an advisable play at the moment. I'd look for a move off the new support line formed by the wedge topline, or a bounce off the wedge trend line for an entry signal.

Next weeks Crystal Balling will include a few new set-ups. I'm reading "Hit and Run Trading" and "Schwager on Futures: Technical Analysis" at the moment. From HART I will be programming the set ups into prorealtime over the weekend and then each week I'll try to include one or two very short term plays.

I find most of my better calls seem to go off the general trend, patterns, stochastics and low supports. I think these will still be the majority of my calls until I get some evidence I can use the strategies from these books.

The exam went brill so I'm going to try some intra-day analysis and possible trades with £1k on some downtime tomorrow morning/early afternoon.

My 'Hot List' setup for tomorrow is:

• BBR
• SEO
• MARS
• RTN
• LAM
• YELL
• WTN
• GPOR
• RRS
• PET
• HAWK
• MNDI

These are all momentum or short term stochastic flip plays and I expect a few of these to +10%. Hopefully I pick the right one.

Realistically, to beat a part time 'student' job over a 4 or 5 hour period, I need a return of £25 after brokerage which equates to 5%. These plays are valid for another few days so getting out before the days close doesn't really apply - particularly if the indicators are still good.

I don't day trade, but one day I would like to - so this is a chance to start learning.

0930 update:
Tried to buy GPOR at 471 as it looked like it was going to rally. My broker insisted I had "insufficient funds" to buy the stock, despite asking for £800 worth of my £1k amount for today. Needless to say this was entirely based on the fact that the price was steaming up, and within the 15 second quote timeframe the price increased to 475, with them being out of pocket. I tried again, it said the same, and the price went to 480. My broker is ridiculous. Also noted that quite often, my sells don't show up at all on time/sales - so it looks like I'm dealing with my dodgy broker instead of the open market.

Also just tried to buy into WTN strength but the spread is huge, and the manipulators are on board - the stock quotes keep dissapearing, re-loading, the buys go, the sells double, then it reverses etc etc.

There is nothing moving although SOLA is down 4.5% so I will be looking for a turn around there.

Temptation to load up more DES creeping in.

Update 1100
You can't beat this market - day trading equities in the UK - unless you're a broker or have insider info and you get in on closing the previous day. Nothing moves, you deal with crap brokers, big spreads etc. You really need some clout and that's the end of it.

Swing still looks good, but for now, I've topped up in DES and I'm not going to trade for a few weeks. Hopefully I get enough out of this position to enable me to move over to Interactive Brokers. Information is key, and IIIs is terrible, and so is their platform, and so is their level 2 service, and so is their reliability... I could go on and on about it but there's nothing I can do until I have US$10k.

I think this article explains it quite well: http://www.guardian.co.uk/business/2008/may/03/stockmarkets.investing

End of day update
Couldn't follow the happenings because I had a maths class - but a bit of movement post 1pm. I keep saying it, and I'll say it again. ReneSOLA, what a stock!

Also noticing VPC looks a lot like the chart of BP.

Not much else happening. From all the stocks on my hotlist yesterday only one of them was down. I have noticed the main time fluctuations are:

1. 0800-0805 When the brokers make their profits and nobody has a chance
2. A lot of stocks rally between 1330 and 1600, steadily
3. Trade SOLA and nothing else lol

From this weeks Crystal Balling, 3 stocks up, 1 is down but still in target area. WTN up 44% (52 at peak), AU down about 1%, PFC up 2% (5.5 at peak), JPR 8% (10 at peak).

For tomorrow: BVS on momentum, ITRK for new highs, IEC on closing strength, BDEV on indicators and lows.

Some call yesterday, up 17% today!

Edit for 7th May: Up 43% in the past 2 trading days.

Big exam on Wednesday, so short and sweet this week I'm afraid.

Autonomy (AU.)

Recently formed a false head and shoulders formation and briefly dropped out of it's long term channel trend line - but has moved back in with some strong bullish moves. AU. sits in an ascending wedge. This is looking good for a rally to at least 1000p for 12%. The reasoning behind this are the wedge formation, oversold and up facing stochastics, MACD on the reversal and the directional movement indicators also on the reversal.

We need support first at the fast line ema and further support at the lower trend line for confirmation. A break of the other emas is a good sign here. Price target of 1000p, stop loss 1% below the trend line.


West Canadian Coal (WTN)

Quick play on coal prices and solid upward trending chart with higher highs and higher lows. The stochastics line up well with the support line, indicating a reversal for a new high is on the cards. Any move up on Tuesday should provide confirmation of the continued trend - look for a break of the fast line emas - as the rally hasn't really been below these before to the same extent. I have seen better ADX and MACD so just watch for confirmation before you enter.

Price target of upper trend line or within 2% of it.


Johnston Press (JPR)

Taken a bit of a hammering for quite a while now and is currently settling at some 2006 sup/res range. Think we could see a quick scalping opportunity to 8% on current price within a few days. My reasoning for this is that bottom fishing plays on bigger companies have provided some good returns on my analysis lately - and also the double bottom, stochastics situation, directional movement situation and some good divergence on the MACD.

Target price of 145p, stop loss around 124p. Tread carefully with this one as the trend is down, no doubt about it. To me this solely represents a quick trade to 145p. A break of 145 might be worth some new analysis - a break on the downside of 124p indicates a shorting opportunity.


Petrofac (PFC)

Looking good here. Another oil price play and solid looking chart. All the indicators look good for a run to the upper trend line here - which is your initial exit point. I believe that we might see a break of that to some loftier ranges based on the indicators at hand.

Should find some good support at 592 now.


Was going to cover Centrica (CNA) too but too risky I think.

The 'inside W M'.

Just been looking over some recent charts tonight and have started to notice a recurring pattern. It's an M inside a W - I'll call the pattern WilliaM.

I know about Ws but have never read anything out there about them, and all of this is probably just called a W formation but they're pretty interesting to look at. The picture below shows ADM, BP and to a lesser extent BAY in William formations.

The lead up to the first drop was a head and shoulders for BP, and a trend break on ADM. BAYs is just a tiny short term WM so I won't dip into that one.

What we're looking for is a 2/3 retracement to form a high, a slight pull back off the high in the form of a hammer or spinning top candlestick and then a move back to that high. This move signals a double top formation, a short indication with a target of the original low.

The price target off this double bottom is the price on first formation of the left hand side of the W - about a third of the double top price.

From the charts I have here, it may be good to take some profits and let some run - as twice it has more or less gapped up to break the support and resistance line formed by the W. However in the case of ADM - a fall of a price equal to exactly double the height of the W occured.

I will add this to my arsenal of TA weapons in future crystal balling. Important things to consider with a William formation are:

• What is the lead up to the pattern - was there another formation, such as H&S?
• What are the horizontal support and resistance lines?
• Is the stock in an up, down or sideways channel?

This is a lot better than waiting for the double bottom - because once the M has formed, the probability it will follow this pattern seem quite high. It may be too risky to enter into a position on a bounce off the first low - it would be wiser to wait for the 2/3s high, maybe quick trade the M and then short on the double top with a target of the W double bottom. Enter long on the double bottom with a price target of the top of the left side of the W - depending on channels.

Take profits on full W formation - and maybe let some run to see if there is a gap up.

Strong closing for the FTSE on Friday shows a lot of extremely bullish movement across a lot of charts I'm looking at.

Leading with BAY my watchlist and TA from last week is looking pretty good. As it closed, BAY is at just shy of 250 - up 12.5% from 222 on huge volume. Really pleased with my analysis of this one, a lot of the 52 week bottoms show some good leading indicators to make good judgements on. While the stochastics are still good, the MACD and ADX are looking even better. I would like to see it break 260 clean - we might see a repeat of last October if we don't.

BAY is still in a downward trend, but these swings provide good trading opportunities. Check the upper trend line breaks for entry points. Some strong moves next week could see the start of consolidation or a reversal.

British Airways chart:



BP smashed the resistance at 582 as it gapped up on strong volume - reaching the point were the bear gap was set on the fall prior to the W formation. At it's peak it hit 622 which was 3p short of my target price. The volume has been low, with a lot of profit taking following the jump.

BP chart:



As the stochastics look to be creeping down to -80, and the directional movement taking a turn for the worse, I think we may be looking at either a bull flag or a drop to new support at 595. I will be watching for support at the 100 day ema on a failure of the gap support at 595.


ADM had a cracker of a week, up 13% on the week and 18% since I clocked on to it. Very pleased again with this one, as with BAY, the indicators looked excellent as it hit a 52 week low - which was historical support/resistance back over 5 years. The stock has reached an important SR line following the rally. A lot of the bullish close was to do with the overall market - there are still some promising indicators. An EMA golden-cross formation on Monday for example could prove very interesting.

Admiral Group chart:



I haven't been too impressed with NG. It is up maybe 1.5% on my call, but looks like it's attempting to form some kind of triangle/pennant. I reiterate 'watch' for a lowered break of 740 for the action.

BA. is getting it's dilly-dally on. It's up maybe a few pence after slipping out of it's upward channel for the first time in over a year. It is back in there with some good looking indicators - but I would not necessarily enter a trade on this until the parameters for the ascending wedge are a little tighter.

BAE Systems chart:



AAL is a real watcher. After predicting a drop, the stock dropped 8% - but has rebounded with some very indecisive candlestick formations. The volume is edging out of this one, but there are some conflicting indicators - ie stochcastics saying yes, DM saying not yet, MACD saying no. It looks also like there is an inverse head and shoulders pattern as we form an ascending wedge featuring an extreme tangent. This indecision in the market will either see AAL smash 3470, or drop down to the dotted trend line. Excuse the alert signals on the graph - like I say, one to watch, and I'm not sure I have enough skill to be able to call this one.

Anglo American chart:




VPC looks like it's trying to figure out which way to go. If you find the chart for it, the entry/exit sup/res lines etc should be quite easy to spot.

MGCR looks like it needs to break 238.5 before it sees a rallying call. If that fails, watch for support at 207. The bullish engulfing from Friday was on very small relative volume - indicating it was more the market that brought it up, rather than on it's own merit. 238.5 for a buy, short on a failure of that clearance. Buy at 207 depending on signals.

The fantastic ReneSOLA looks set for a drop, to around 340 or as low as 210. However, solar stocks are up and down in the US - so check for the movements there. All my indicators say down for next week. If you get it right, SOLA is an excellent stock to day trade once you get familiar with it's movements. I've watched it go up 9% in half an hour on a few occasions now.

Check back on Sunday for next weeks watchlist. I am familiar enough with the above stocks to know their movements without continuos TA - so I might reshift my focus next week to some smaller companies. At the moment, I'm looking at Autonomy (AU.) and West Canadian (WTN) - a stock I wouldn't normally cover but wait for this chart! I'm also looking for a move off lows for Johnston Press (JPR) and speculative analysis plays on Centrica (CNA) and Petrofac (PFC)