With the stock over $60 today, I liquidated 1/3rd of the position for a quick 10% gain. (1 day) That takes us down from a 3%ish stake to 2%..
I will sell 95% of the remaining holding below the low of the day, which is $59.91. To give myself leeway, $59.80 or so will be a stop loss. Then we once again created a gap in the chart this morning and I'll repurchase at the bottom of the gap... around mid $57s. The 20 day movingaverage continues to move up and is now mid $55 which is where I'd buy more
I've executed the first 2 parts of this trade this morning - I was taken out of almost the entire position this morning at $58.00 (the stock gapped down so my $59.80 was blown right through) and I just bought back about 50% of the position down in the $57.50s. In theory if the stock was not gapping up and down this would of worked nicely but because the open was a "jump" down instead of gradual it didn't work out quite as well as it should of.
The "gaps" in this chart have been filling extremely quickly - sometimes gaps don't fill for months; in BHP's case it has been happening almost every other day. I'm looking for a retrace to the 20 day moving average to buy another batch which is now around $55.
This has been 2 successful round trips on this name in a week; as long as reflation is the trade this name should continue to work but I am wary that 'reflation' is so crowded as a theme. If? When? the market ever reverses in a serious way I actually am going to be shorting 'reflation' quite hard, at least temporarily. A lot of hot money who does not care about fundamentals is now in this trade, so they will leave quickly.Today S&P 928 seems to be the level the bulls are defending but it's pretty quiet out there otherwise.
Long BHP Billiton in fund; no personal position
