Small Cap Oil Trades

We saw quite  run in BDCO, as of yesterday a 125%, but I'd be taking profits now. There's some potential for follow through in other names so I want to give them to you and hopefully you'll set an alert for a price breakout. If you don't have the software to do this, I use TeleChart which is linked at the top of the site, I've been using it for over 10 years.

They (Worden, the makers of TeleChart) also offer a free REAL TIME (no exchange imposed 20 minute delay) platform called FreeStockCharts and I'm certain you can set alerts there, it's a fantastic platform for free.

So here's the charts I've found that still haven't broken out.

 EGY is similar in some ways to BDCO, such as the rising or ascending triangle which is a bullish continuation pattern. I'd be interested in this trade on a break above $8.01 and that's where I set my alert. I'm not impressed by the volume, it doesn't have that going for it where as BDCO did, but we're looking for the quick double/triple digit pop, not a long term investment here.

 FXEN is a nice consolidation pattern, volume looks good and there's already been a head fake to the downside which I like to see. So my alert for FXEN is at $10.20, you may want it a bit lower for some time to look at it, but that's where I give it serious consideration.

GASS was easiest to see the trend on a 5 day chart, sometimes you just need to clean out the noise and longer term charts will do that. The green line is the breakout point, the red line is an automatic swing stop that's built into the way I like to play a swing trade like this. So the limit alert on the upside is $7.08 and the stop is $6.41, of course you can always move the stop to your entry price as well or just below.

So set those alerts, remember these are somewhat speculative by their small cap nature and no speculative trade or any trade for that matter should risk more then 1-2% of portfolio value if you are stopped out. The idea behind risk management is survive long enough to hit the big trades. You've been conditioned since you were 5 or 6 years old to think that you need 7 out of 0 correct to be even a marginal success. That simply isn't true in trading, get over it. You don't need to be right, you need to make money. Think of trading more like baseball and a batting average of 300 is pretty darn good, but it also means you only get on base 3 of 10 at bats. This is a healthier way to view trading and this is why risk management is so important. Those that say they have 80% win rations may have that (or may not), if you consider a penny profit a win, I consider that the fastest way to go bust.