$AMD - Where is it headed?

$AMD Thoughts

Update: August 27 2013 

So $AMD did exactly what I said (read the article below) 

Current price of $AMD 3.39 remember that I said short if $AMD goes below 3.75

I would have shorted this insanely myself but I have a long position in $AMD 1000 shares at 2.91! And you know what they say about longing / shorting a stock at the same time! It's illegal! I coulda let go at 4.65 Ish and then shorted but honestly I don't want to mess with my position, ill leave it as is! Hopefully someone tried it out! 

Read below for the original article! 

So this is what I think will happen in the say next 1 month or so...lets see what plays out.

What I would do: (this is not investment advice, read the writing on the top of my blog if you have not yet)

Option 1) Buy above 3.90 

Option 2) Short below 3.75

Example Situation:

Say you want to risk $1000, what that means is you don't care if you lose $1000 if this trade goes wrong, now also you have to know when this trade goes wrong, so have a quick look at the chart and follow me closely. You need to know the following things:

1) How much you are willing to lose ($1000)

2) When will you know you are wrong?

3) When and where can you take profits?

So if your in this trade, if you think $AMD is going to die and go below 3.75 then you should understand that 3.90 and 3.75 has a difference of .15 cents. 

So if you are willing to risk $1000 this is what you do:

$1000 divided by .15 cents (risk in the trade) = 6666

What does the 6666 mean? It means you can short 6666 shares at 3.75 or 3.74 and lose approx $1000 if the trade does not go your way! What is not your way? If price goes up and shoots to 3.90 you are negative $1000.  So you know you will not LOSE more than $1000!

Now when do you take your profits? What I normally do is I take profits when the price of my stock has moved doubled my risk, so my risk was .15 cents, so I need a .30 cent drop in price to take out half my position (which is 3333 shares) and I will make approx $1000.

Example:

Short 6666 shares at 3.74

Once $AMD goes to 3.44 I cover 3333 shares and lock in $1000 in gains, IN ma POCKET

I still have remaining 3333 shares in the position that I will let ride, because I have already locked in $1000 I don't care what happens, the price can come all the way back up to 3.74 but I still locked in my $1000.

Read the chart! Classic Short Setup on the daily, lets see if $AMD has enough bull power to keep it up...markets just ripped into new highs will they hold this bad boy up or will the bears pound on $AMD and bring it lower? 

Right Click Chart, Open in New Tab

P.S.

No Trading for August since I am a busy man, my blog will hopefully be filled with updates about the market, possibly commodities and any thing that I see developing.

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