HowI have lived my trades in AMD :
- Above the 200dMA. I always let it run for a few days
- Back down with the 200dMA as a support level. (and stop loss if you would have been in)
- Previous resistance of 7,25 becomes support
- Again through the 200d MA
- waiting for the confirmation, but in a channel with 200d MA as a support. I got in a 7.84 (stop loss at 7.70 – just below the 200dMA)
- Added positions at 8.24. AMD went through the clear resistance level of 8.25, with a gap up and volume increase. On top of that, a golden cross.
- Another gap up with increased volume. I added shares at 9.19 and set a stop loss on 8.49, the upper end of the gap at point 6.
- Gap down, huge volume. Stop loss activated (all out, take profits). Too bad, but the rules are the rules.
- 8.25 becomes a support level
- it brakes, the 50dMA becomes a support level
- it brakes, the 200d MA becomes a support level
- it brakes, increased volume
- 7.25 is the next support level
Although all the signs were good (above 200dMA, golden cross, 2 times a gap up in short tie with increased volume), always, always set a stop loss when you place the trade…always. Keep the losses under control.
I sometimes have a stop loss which gets executed and the stock goes up again. This can give frustration, but cases like these remind me of the good side of stop losses. It also keeps you from adding to losing positions.