Thursday, February 08, 2007

Trade of the Day - MasterCard Incorporated (Public, NYSE:MA)

MA was a breakout candidate at $113.00 as highlighted on the HCPG (highchartpatterns)newsletter last night. Although it was already on my momo list, the HCPG newsletter alerted me to pay special attention to MA this morning.

I played the breakout as a low risk dummy entry with my initial stop just under the breakout point. My initial risk on the first entry was $0.30 and I sold my position after a 1 pt. gain. Because that the stock had run up substantially before the break, I knew we were going to turn around and retest. Once the stock had successfully retested the $113.00 breakout point and taken out the previous bar high, I entered a second time for another low risk entry just above support of the rising 10 period EMA.

MA reports earnings tomorrow before the bell.

Sorry about the late postings. I will be back on schedule next week.


Kevin said...

Hi Jamie,

Nice trade in MA. Some of my favorite trades are "dummy trades just prior to a daily breakout. The risk is low and the potential reward is huge. Another example is Nortel on Wednesday which you've written about. Nice going.


Anonymous said...

Hi Jamie

Just curious on MA why you didn't exit on the 5th bar on your second entry for a nice 1pt gain, as then the forms a hanging man and the next bar retraces right back to your entry. Hats off to you man if you can watch a trade retrace a whole dollar back to your entry and still remain patient.

You must be the best trader I've seen and heard. You should be trading for a hedge fund! Your own hedge fund!

Nice work.


Jamie said...

Thanks Kevin,

I've embraced the dummy trading method. A big thanks to mentors X, Mike, and Max. Those late session vertical moves like NT on Wednesday are my favorites.

Good trading!

Jamie said...

Thanks Jon,

I was reluctant to take the second trade given that it set up before lunch, but decided that the technical aspect overrides the time of day. I held on hoping for a bigger move later in the session. I was focused on the 10 period EMA. As long as it observed the EMA as support, there was a chance for a bigger rally.

Good Trading!