2014 06 27 Property is falling and Miners have potential

Today I bought Amara Mining, a junior gold miner. They already produce gold from a mine in Burkina Faso, and have other mines in development. The graph is, in my eyes a compelling buy.
2014 06 27 Amara Mining

I am setting my stop below the low of July 2013, giving the trade plenty of room to breathe, and I may add to it as the price, hopefully, rises.

Earlier in the week I set a trade to open, selling Rightmove, on a stop, ie if the price dropped to a certain level. The trade was triggered and I am now short Rightmove:

2014 06 27 Rightmove

Retrospective wisdom is something that I have plenty of, and I wish that I had opened this trade when the price first dropped below the 50ma. This is the challenge that I face with this type of trading: 'Is it a pull-back or is it a reversal?' With another trade that I placed this week, I had the same dilemma. I saw that the price of Grainger Plc had fallen. Grainger is a property owning business, they are landlords on a large scale. I set an order to sell Grainger to open if the price fell below the previous weeks low, but the trade has not been triggered.

2014 06 27 Grainger

If the price of Grainger continues to rise then I shall be very glad not to be in a short trade. However, if the price plummets next week, I shall wish that I had sold it short on the pullback. My plan is to run the order for another week and see what happens

One of my long positions, CenturyLink hit its trailing stop this week and has been closed for a modest profit.

2014 06 27 CenturyLink Inc

I have also gone long Kazakhmys, a copper miner based in Kazakhstan. Again, its graph is, to me, a compelling buy:

2014 06 27 Kazkhmys

I like the idea of buying when a share is rising up from an all-time low, but I want to have some reassurance that there is an uptrend in place, not simply a temporary rise in the share-price to be followed by a slump. The problem with waiting for confirmation of a price rise is missing out on a large part of the early price move. I will be reassured when I see a succession of higher highs and higher lows as well as an MA cross-over. I am keeping my stop below the low of January until these items fall into place, and then I shall add to the position.

Click here to watch a video review of my open positions.

Comments

Popular posts