BG - Bunge - Base & Break - Anatomy of a failed trade
Bunge was on the HCPG newsletter from last night.
The Ag sector gapped down with the market, found support and started to work its way higher.
BG formed a base at the ~122.40 area and the Ag sector was working its way higher / showing relative strength to the rest of the market. Volume wasn't great but BG did have considerable buying interest yesterday.
BG was trading above the daily VWAP (Volume Weighted Average Price), which means that buyers were in control.
I took a chance on a break above the 122.40 area. My goal was to partial out 1/2 of my position at yesterday's high (also the location of the daily R1 pivot point).
BG began to push higher until it started to reverse. When it did, it was on higher volume, so I tightened my stop.
At the same time, you can notice that selling pressure began to pick up in other stocks in the Ag Sector. Notice the highlighted gray areas on POT & AGU.
As you can see it was a good decision to tighten my stop on BG. I would have been stopped out at my original stop position.
I was looking for an entry to go short somewhere in the Ag sector, but my internet connection to my brokerage was particularly slow. Hopefully it improves sometime soon :)
I also had a base & break short on WFR early, which also was a HCPG newsletter mention. It initially looked good, but ended up stalling.
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