However, the short term trend did turn down last week, which is a signal to close out any long positions in the stock. Because the long term trend remains up though, my system would not allow shorting this stock.
Last week, I mentioned that the TSX entered a new bull market. I am still seeing a lot of strength in resource related sectors. The chart below shows the Canadian iShares performing much more strongly than QQQ:
Similarly, the Australian iShares hit a new 52-week high on Thursday:
Lastly, for next week, I plan on adding to my second biggest winner currently in my account, SNA:
By any definition, this stock is in an uptrend, hitting new highs and showing relative strength.
I only placed one trade this week, which was to sell GRU. I bought this grains ETF while it was making fresh new highs, but it subsequently reversed to quickly become my biggest loser. Fortunately, because risk management is of paramount importance to me, this lose only resulted in my total account equity dropping by 2%.
This theme of risk management, drawdowns and the idea of process versus outcome is brilliantly touched on by Australian trend follower Nick Radge in the video below:
