Hello all,
I started trading with the basic Hershey equities method as mapped out in the first journal back in late February. When I started I made a BUNCH of mistakes. I knew the rules, knew the method, knew that your supposed to follow the method consistently.... but I guess this is something everyone needs to learn on their own. (I have read "Reminiscences of a Stock Operator" and this seems to be the case). I lost about 1/3 of my capital. Since then I have battled my way back by using the Hershey method and by sniffing out the solar stock bounce. I am now significantly up and am getting better at reading charts and distinguishing between true and false breakouts.
I posted a few clarification questions back in Feb. I would like to start posting my more detailed trades and questions, but I am wondering if I should do that here or start my own journal. What I am doing is FAR more basic than where you folks are at, but this seems to be the resident Hershey thread
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Anyway, I'll post a few questions/observations here.
1) I think I finally understand the basic Hershey method. When I first started I would always Make one of two mistakes. First, I would think that if a stock was shooting up early in the morning I had better by it instead of waiting for the pattern to develop. Second, I would dump a stock when it started performing badly instead of giving it a chance to reassert itself. Both of these came from the error that I thought I should be making money THAT DAY, instead of seeing it as buying into a pattern which will continue over several days. For example, I purchased EXM yesterday at when it was up .40. It closed around +.26. However, there was a ton of volume on it, so I held on, even through a brief negative dip. One could call that performance mediocre at best. But then today came. Bang! It was up almost 20%.
2) This is something I could use some advice one. There do seem to be stocks which give false signals ALOT. I have been following COIN for weeks now. It got me about five times where it would reach DU early, before even 10:30, and all indicators were a go. Then somewhere late in the morning it would lose about half its gains and volume would disappear. It would then deteriorate throughout the day. What does one do in the case of stocks like these? Should I up the use the midrange DU level instead of the Low, or just take it off my list?
3) I have had 2 successful trades during down market trades when I have bent the rules a little bit. I'd like to know if this is ok. The market will be down, and most of my DU list will be down as well. However, I will notice that one stock seems to show resistance to every dip. It may go down some, but it will refuse to join the fray. I have purchased those stocks when the parameters are "close," let's say 80% there. When the market has a recovery later that day, that stock will advance nicely. Any thoughts on this? As I said, I have only done this twice, and maybe I just got lucky.
4) Finally, any advice on Hershey Long trading in a really weak market like we had a few months back? Or should I try to learn some shorting methods? I just remember from "Reminiscences" that I should be bullish during a bull market and bearish during a bear market...
Anyway... thank you again all, especially Spyder. Your wisdom on all these matters is VERY appreaciated.
