Interdum stultus opportuna loquitur...

Wednesday, November 30, 2005

SPIRant: The Shenanigans Continue...

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Yet again the SPISpy-ers were faced with an annoying contra-move that started literally three minutes after the 'entry window'; here's the day's first Spy (sent 1:16 p.m.):

Guten Abend.

Short SPI at or before 1:30 p.m.; targets +5, +8, open.



There was a 14-minute window from the first Spy through until 1:30 p.m., during which the SPI traded between 4675 and 4680 - the most frequently traded price (and also the price right at 1:30 p.m.) was 4677.

And at 3:16 p.m. the call went out:

Despite another highly-suspect uptick three minutes after the 1:30 p.m. entry time declared earlier, the uptick didn't stick and everything worked nicely.

Short Entry between the first e-mail and 1:30 meant an entry price between 4679 and 4675 (the high during the entry window was 4680 but nobody can short a high - highs are achieved by BUYERS hitting the ASK).The most-traded price in that timeframe was 4677 (which was also the price bang on 1:30) so that's the entry price basis.

One-lotters got their 5-points easily (the low thus far is well below the 4672 for those who managed to short the low in the entry window); 2-lotters got +5, +8 likewise.

Those trading 3-or-more are still riding, with a 15-point gain at present on all trailing lots.

The ASX200 (XJO) index is likely to bounce from 4650 (which should coincide roughly with SPI 4660).

Three choices at that point:
  • take all off (taking a 17-point gain on all but the first 2 units);
  • take off half of remaining units (only an option for the couple of folks who are trading ten-lots) and keep a stop at "Entry +5" for the remainder; or
  • impose a stop at the entry price and keep hold of remaining units.
I favour the second option if you've got more than 2 contracts left (i.e., if you're trading more than 4).

Not a bad trade.

So after closing Monday's short from 4670 with (3,6,33) on the timed reversal up from 4637 (timed to begin at 11:30 a.m. yesterday, as per yesterday's Spy), which multi-lotters got to ride all the way to 4677 thus pocketing (3,6,40); and as of right now they pocketed a further (5,8, 20, 17) on today's reversal.

The notation (w, x, y [,z]) is SPISpy notation for gains;

  • w is the gain on the first lot and also the total gain for a one-lot trader; 
  • x is the gain on the second lot (if any); 
  • y is the gain on the third tranche (for those trading 3); and 
  • z (optional) is the gain on final tranches (if any - when a third tranche is closed but part-position is still in force).

I'm a tad miffed that yet again there was some clear evidence of 'stop-tickling' at pretty much precisely the time indicated for entry. It's happening too often to be coincidence, but it's not anything to worry about - it will be a test of sweaty palms (and a source of teeth-grinding for thinly-funded traders).