The Morrisian Indicator

So far I’ve been doing my indicator for 30 trading days and I’ve been checking my paper-trading account and it has been growing gradually as I have been making trades based on my indicator.  The lat I saw my paper trading account stood at over $7,200, which is probably at least a $600 increase in my account and that is in spite of missing at least one trade based on my indicator and making a questionable trade because I was impressed how a certain stock rose on robust volume for at least 2 days in a row.  That stock was AMD.  My wisdom of getting out of the AMD position after only 2 weeks was recently confirmed.  Not only did AMD fail to go up, it is recently tanking.  I also have a sell signal on AMD on heavy volume from yesterday.  I input an order today to buy AMD puts but I doubt that order will be fulfilled because of AMD’s continuing downward pressure.  I am somewhat concerned that AMD may bounce upward off of its 20 period moving average.  If it goes below this moving average there is good reason to believe it can go down much further.  I would say there is a good chance it can go to $5.25 per share from its current $6.38 share price.

AMD is not the only position I tried to enter.  I am also trying to buy 12 calls in DNR after this stock recently gave me a buy signal.  I tried yesterday and was unsuccessful and am trying again today.  I did manage to buy 9 calls in OAS yesterday and it seems to be working for me.  I also did sell 3 NBR calls for a nice profit yesterday at $1.75 a piece.  If I manage to get into all of the positions that I want to enter I will have 3 long positions and one short position.

Looking over all of my charts I am seeing that MT may be inclined to give a sell signal in the near future prompting me to buy puts.  The day before yesterday this particular stock seemed to indicate heavy exhaustion bury as the signal line continues to move closer to the centerline where a signal could be generated.  I will need to watch MT  closely.  I also need to look at all 20 of the stock I am following and determine their respective sectors.  This will enable me to easily determine how the overall sector is doing so as to better know whether I should enter a particular position..  I think I will post the sector for each of these stocks on my next post.

Lastly I am continuing to regret that I did not get into MRO when I had the chance.  It’s latest position on my indicator is .87 the highest ever.  The latest price on the MRO chart is 16.33 which is well above about $14.90 when it first generated a buy signal.  I just want anyone following this blog to know that I am deciding to fund my options trading account with $2,500 from my IRA due to the apparent success of my trading system with my paper trading account.  I will try to post again this saturday and let you know if my paper trading account has made any progress.

 

EC Morris

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