I was driving the Road to Hana in Maui in April and telling my wife how great the Garmin was working in our Jeep. I insisted that we should both get one when we get back to Jersey and she even named the Garmin “Cathy” while on the island. We used it to find Costco, Mama’s Fish House, our surf and snorkel gear and an Outback Steakhouse. The thing was awesome and so accurate. It was April and Garmin was a stock I just sold for a small 15% profit on a short term trade. What the hell was I thinking?
Ride the trend. The trend is your friend. Sell with a violation of the 200-day moving average. Don’t bother short-term trading. Keep commission costs down. Etc…
These are all things I attempt to follow with every trade. I went through a phase where I wanted to become a short term trader but realized that it wasn’t for me, not at this time. So, I looked in the mirror and admitted that I do my best work when trading longer term weekly trends. I am not TraderMike or Charles Kirk.
This “short-term” strategy seemed to make me some money earlier in the year when I quickly grabbed that $15% gain in GRMN, selling at the top of a gap-up. I nailed it; sold at the top and walked away a winner. WRONG AGAIN (this seems to be happening a lot this year: leaving profits on the table). I admit that it’s been a great year but I left this home-run on the table and only took down some scraps. My profits from February could have increased another 4 times had I stayed in the position patiently.
My short term trade was initiated on 2/1/07 at $49.74
The stop loss was 8% or $45.76
Target was $60
I sold on 2/23/07 at $57.55 for a 15.70% gain
A 1.9R gain
It never hit the stop so the current gain would be (as of 8/2/07):
a 12R GAIN! – Home RUN!
Garmin was a prime candidate for the $60-$100 run that I so often target, a run that I followed heavily for dozens of stocks on MSW over the years. I lost my focus on this stock and it cost me a lot of money (not in losses but in regrets).
Anyway, here is some of the Garmin (GRMN) coverage that I posted to the blog over the past year. The stock also appeared on the MSW Index many times in 2006 and 2007 (before I closed it down in March).
- Indicators and Research Save me Money
I saved the portfolio $4,000 in profits from my sales on Friday and Monday (GRMN and SLW).
- Support at the 200-day Moving Average
GRMN – $49.69 -sitting on the 200-day moving average!
- Ten Stocks to Watch
GRMN – $47.18 ($95.35) down over 2% for the week but the stock continues to hold the 50-d m.a. as support while maintaining a presence near the psychological triple digit threshold. I still like the stock in a rallying market (could make a nice option play for a solid run).
- MSW Market Overview
Looking at the MSW Index, we see that every stock fell for the week, so which ones dropped the least?
GRMN – $49.12 ($99.26), These were the only qualifying stocks from the MSW Index that fell less than the major indexes. Garmin (GRMN) fell less than every major market index and found support near $95 and the 50-day moving average. It did qualify for distribution, the first in 13 full weeks.
- Interesting Stocks with 15% of a New High
GRMN – $31.88 ($64.42), flirting with the 50-d m.a. as the stock sits in the $60 range but is not a an official $60-$100 candidate until it can breakout above the recent peaks set at $70.07 and $68.88