SELF ASSESSMENT FOR MAY 2009

So far, May 2009 proved to be the most profitable trading month since the beginning of the year. Of a total 22 trades in May, 16 are winners and 6 are losers. The average holding period is 7 days with 6 overnight trades and 1 intraday trade. The longest holding period is 25 days - one of the losing trades. The average loss per trade of the 6 losing trades is 0.5% of total equity with a standard deviation of 0.23%. This is way better than the self imposed loss limit per trade of 1.75% of total equity. I attribute this favorable risk variance to the practice of appropriate trade sizing, scaled entries and trading discipline. I am at peace with myself regarding my entries and the execution of protective stops. But I still have a lot of work to do on my profit taking exits - which is not to say that last month's profitable trades are to sneer at: an average 25% return on trading value per trade with a 32% standard deviation that includes 3 outlyers of 75.7%, 82.1% and 98.3% profits after deducting commissions and other charges. I continue to trade cautiously while expecting a potentially significant reversal after an impressive market run up that started Mar 2009. I hope you guys found the month of May rewarding as I did.

JFC 10/14/08 - STOCK FINDS STRONG SUPPORT

CHART WATCH
1. Today's price action completes a short term island reversal pattern and closes above the 15d, 60d and 180d price moving averages. I would like to see the 15d MA (which is also the centerline of the Bollinger Band that I use) tested and hold successfully because if it does the rally could potentially extend up to the higher limit of the indicator's upper band.
2. The 4.50 uptick and 7.00 (18%) single day gain is accompanied by a huge turnover of more than double the 15d moving average.
3. Potential upsideTPs are 46.50 (Fibonacci retracement), 52 (prior resistance), or 54.50 (measured move)
4. The RSI centerline crossover is a manifestation of the uptrend reasserting itself. It is critical that this oscillator not revert back below the centerline in the near term for the rally to be sustainable.
5. The MACD line remains in positive territory meaning that it continues to trend up. But the declining slope suggests that momentum has weakened. It is critical for this indicator to flatten out in the near term or better yet turn up to increase the likelihood that this rally will be sustainable.
6. I own this stock.

AEV 9/8/08

Bought this stock today after it broke out of a 9-month trading range increasing the likelihood of the start of a new uptrend or a higher consolidation range. The stock ends at a new YTD high of 7.70.

JFC 9/3/08

Sold this stock today: JFC @ 43.50
Stock position: 100% Cash

JFC 8/28/08

Bought this stock today with the objective of trading the short term uptrend (also viewed as a corrective wave of the intermediate downtrend). The minor uptrend is expected to encounter selling pressure anywhere between the intermediate trendline and the 180day MA, the area which is considered the TP for this risky short term trade.

AT 8/12/08

Sold this stock today @ 12.75.
Portfolio structure: Stocks 0%, Cash 100%

DGTL

DGTL - 1/9/08 - 1.6 - 1.64 - 1.54 - 1.64 - 5337000
Bought this stock today @ 1.64 ..

STOCK TRADES AND POSITION

Stock Trades: No trades since 10/22/07. The last trade was a liquidation of all my positions.
Portfolio: 100% Cash since 10/22/07.