Bollinger Band Bullish Breakout Strategy--Weekly Assessment

Well, the strategy doesn't seem to be working yet. All my picks from Wednesday's blog, save one, reached their stop limits and were consequently sold for a loss (see table below).


The stock market as a whole did take a nasty drop this week amid fears of ... well ... a crappy economy and housing market. What else?

Stock	Purchase Price	Stop Limit	Price Target	Selling Price	% Gain/Loss
MPEL	11.70	11.40	12.50	11.40	-2.56
LNT	41.35	40.32	43.42	40.32	-2.49
KND	25	24.25	26.70	24.25	-3.00
IACI	36.80	35.45	39.50

I'm not giving up on the strategy though. Truth be told, I've been trading on Bollinger Band (BB)Bullish Breakouts for the past two weeks (when the stock market was actually going up) and I was extremely pleased with my results.

Had I started this blog then, here's what my first table would've looked like:

Stock	Purchase Price	Stop Limit	Price Target	Selling Price	% Gain/Loss
OPXT	2.50	2.20	2.70	2.77	+10.80
EP	20.08	19.00	22.00	20.48	+1.99
UNG	11.12	11.00	12.20	11.71	+5.30
FL	25.15	24.00	28.00	25.07	-0.30

Not bad at all, right? And just to give you a timeline, I didn't hold on to any one stock for more than a few days. Some, like UNG and EP, continued to rise in price. I didn't realize these gains though because I put a trailing stop limit or trailing stop percentage on them to safeguard against a major plummet in price. It's the price you have to pay for peace of mind, I guess.

I'm not going to lie and pretend as though the losses on that first table don't discourage me and temporarily have me reconsidering the prospect of marrying rich. But I think when it comes to learning the stock market, it's important to know in what market environments (i.e., bullish or bearish) these strategies are likely to succeed. Perhaps BB Bullish Breakouts only have good odds in a bullish or steady overall stock market. And that's okay. I'm still learning, and most importantly, I'm not putting more than $1,000 into any one stock purchase.

I didn't add a blog entry yesterday (6.2.11) because I was overwhelmed with my freelance job and other responsibilites/chores. I did, however, have time to run a quick scan in MarketIntellisearch for other buying opportunties under this strategy. I only found one--SSN.

• Buy SSN at 3.10. Stop limit at 3.00. Price Goal at 3.35

That order has me up 6.45% in just one day, with a close at 3.30 (on 6.3.11).

Needless to say, the findings are, as of yet, inconclusive.