Back on the theme of yesterday, where it paid to have averaged down, I refer you back to a previous “Trade of The Week” on Trinity Mirror where it also paid to have averaged down. And I’ve referred you back to that prior trade on Trinity Mirror because it sets the scene for what I am about to tell you.
Those original pyramided positions on Trinity Mirror subsequently stopped-out, at a profit of course, but then I re-entered in late October 2012 when I thought that the price had fallen back to a level of prior resistance which could henceforth act as new support. You can see what I mean in the following Capital Spreads chart in which the thin horizontal line indicates my most recent entry price as well as the support / resistance level that I just alluded to:
The thicker horizontal line indicates the guaranteed stop order that guarantees me almost a two-bagging profit on this trade.
No doubt you’ll want to know that this is for real, and not something I just made up in retrospect, so here are a couple of real-life proofs from Capital Spreads and InterTrader respectively:
I chose Capital Spreads and InterTrader as the demonstration vehicles for these trades because of their excellent guaranteed stop orders.
Two Steps to Better Spread Betting:
Disclaimer: this posting is for general education only; it is not trading advice.