BB Bullish Breakout--Week 2 Day 3

Oh wow, this strategy is really running hot and cold. Although I didn’t publish my picks yesterday, I did search and select a few stocks in the vain hope that the Bollinger Band Bullish Breakout would succeed in this downturn stock market. Yesterday I whined about all my past picks being down—a hint of green nowhere to be found—but today, with the same strategy and approach, all but one are up. Check it out:

Stock	Purchase Price	Stop Limit	Price Target	Price as of 6/7
SQNM	8.50	8.15	9.00	8.33
EDD	17.60	16.20	18.20	17.72
DOG	41.50	40.44	43.50	41.70

Today's overall market performance was a tad better than yesterday's, although the Dow Jones Industrial Average and the S&P 500 Index did still close lower. For this reason, in my research for more BB Bullish Breakout stocks, I didn't expect to find a lot of viable candidates. And I was right. Only one seemed worthy of consideration:

• DLR - Buy at 63.00, Stop Limit at 61.11, Price Target at 66.00

It occurs to me that I should probably document/explain how I calculate my stop limits and price targets. In my research on Bollinger Band strategies, I came across a YouTube video that eventually lead me to a website called "Bollinger Band Genius." (Whoever came up with that name must have some confidence issues, huh?) In the video, the Bollinger Band Genius's strategy involves exiting a trade at a 3:1 return rate. Now I had no idea (and still don't) how one calculates a return rate, so of course I turned to the Internet and found this wonderful website: http://www.sristocks.com/Calculators/Rate-of-Return-Calculator-Financial-Calculators.html.

I basically punch in all the information and just take a guess at what selling price produces a 300%+ return (pre-tax). That price is my price target. Of course, I lower the price (and my returnn rate along with it) if the stock seems like it wouldn't reach that price price in the next month or so. My blog is about trading self-education, and I consider buying and holding investing, not trading.  

My stop limit is usually 3% below my purchase price. It's the maximum penalty I'm willing to endure in this adventure of mine. I'm sure this loss threshold varies from person to person. Some may see 3% as too risky, others too prudent.

Regarding my choice of purchase price, I can't really say if there's a strategy there. Sometimes I set it at the closing price of the previous day. Other times, I really try to make a profit by taking a percentage point or two off its most recent tick. I go with my gut on it (one of the few times I rely on "feelings" in stock market trading).

I'm not stringently holding myself to these entry parameters though. If there comes a time in the future where I think I need to shakes things, I more than likely will.