The best stocks to trade of late in terms of "sensible moves, in a non frantic matter" have been the auto suppliers. They go down to support - hang out a while, then rally ... you can take profits... a few weeks later they fall back to support, you buy and rinse, wash, repeat. Since daytraders don't care about this group and neither do the HFT machines (because the stocks are not in ETFs) they seem to be in much stronger hands and act like the stock market of old. Hence I am enjoying the way they move very much as it makes sense to me.
Magna International (MGA) bounced off support a few weeks ago in the $78s, where I added a good sized position. With the stock scraping $85 I am going to cut back the position by 25%. From here we have to see how the stock acts at $86 to determine how much more it can run.
Since early August MGA has done 3 such cycles of retrace & rally - each time hitting the 50 day and creating awesome non frantic trades.
Long Magna International in fund; no personal position
Friday, October 8, 2010
Bookkeeping: Selling 25% of Magna International (MGA)
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