Here is an illustration of how to talk yourself out of a trade. On the CMU chart a), a trend line is marked on the weekly. I liked the look of that; the bottoms are lifting. An X shows the buy entry, another marks the sell. Selling was a bit of luck more than anything, though the entry was a good one at the trend line. The sell was to take profits, as I could not see a reason for the jump so quickly.

If the stock moved back to the trend line I resolved to buy it again. Meantime, I tried to find out why the spike occurred and what CMU does. CMU manufactures all sorts of car parts amongst other things. So I reckoned the GST might impact hard over coming months as car sales decline. So much for opinions, in view of CMU's announcement this week of buying into TJM products, one of our biggest four wheel drive equipment suppliers. See chart CMU b). The deal is expected to be earnings positive immediately. Do you think someone knew ? (Arrow highlights). Who knows !

The announcement I would assume to be a top in the short term at least. Buy the rumour, sell the fact. And trade the chart Phil ! Not emotions or beliefs. It never ceases to piss me off how I can on occasions talk myself out of a trade.