Pascal
10-04-2019, 04:42 AM
DXC is an interesting losing trade that I closed two days ago.
DXC is the former consulting arm of HP. It is a very large company that is profitable but under heavy debt.
DXC is clearly in a strong downtrend.
48866
I bought after the announcement of the appointment of a new CEO.
We can indeed see below that this announcement attracted money (Positive EV pattern.) Hence, I bought, but only 1/2 position because the stop was 10% lower, which is rather far for me.
48865
The EV pattern looked positive until the market selloff of two days ago, which forced me out of the position on a stop.
48863
It is interesting to see that the DXC Supply pattern is very similar to the ZS Supply pattern: we have a group of locked in investors and then a very low Supply level around $33 - my entry price.
However, when the stock fell below the $31.5 level, the Supply started to increase and the market sell-off was quick to force the most recent investors - like myself - out of their position.
48864
I made two mistakes here:
1. I bought at a price that was too high above my stop. I should have waited for a lower entry.
2. I did not sell when the price crossed below $31.5 as the EV pattern still looked good.
Every losing trade is important so that the same mistakes are not repeated.
DXC is the former consulting arm of HP. It is a very large company that is profitable but under heavy debt.
DXC is clearly in a strong downtrend.
48866
I bought after the announcement of the appointment of a new CEO.
We can indeed see below that this announcement attracted money (Positive EV pattern.) Hence, I bought, but only 1/2 position because the stop was 10% lower, which is rather far for me.
48865
The EV pattern looked positive until the market selloff of two days ago, which forced me out of the position on a stop.
48863
It is interesting to see that the DXC Supply pattern is very similar to the ZS Supply pattern: we have a group of locked in investors and then a very low Supply level around $33 - my entry price.
However, when the stock fell below the $31.5 level, the Supply started to increase and the market sell-off was quick to force the most recent investors - like myself - out of their position.
48864
I made two mistakes here:
1. I bought at a price that was too high above my stop. I should have waited for a lower entry.
2. I did not sell when the price crossed below $31.5 as the EV pattern still looked good.
Every losing trade is important so that the same mistakes are not repeated.