For a stock like SanDisk, daily fluctuations are large. In fact, most of the time it moves in a relatively regular way, and the trend has strong continuity. Whether it’s the daily/weekly-level pullbacks from late June to mid-to-late July, or the oversold rebound in the middle, or the violent breakout-reversal the night before—most of the time it’s still a decent way to make profit. But because the average daily volatility is high, it’s actually more suitable for doing with a slightly conservative position and low leverage, accumulating slowly and steadily. After one or two months, you can still make a lot of money. High daily volatility is not suitable for going heavy, because when the “front of the car” is too heavy, it becomes difficult to adjust.
SanDisk finished its big pullback within a month, and within half a month it recovered half of the total decline. The pace is very fast. And because it’s fast, going heavy is easy to get wiped out. Our only standard for going heavy is absolutely this: when the trade is already in floating profit, and if the trend continues—add to a long position when it breaks the previous resistance, or add to a short position when it breaks below the previous support. This way, you stack profits on top of already-earned gains. That kind of heavy position is the most stable.
For example, yesterday’s second breakout at 1581—add to longs, take profit on half at 1626; after the second breakout at 1626, add again, and take profit at 1680. That’s how you steadily stack profits—aligned with the trend, and suitable for heavier sizing.
Going heavy must be quick and decisive. You don’t have infinite “ammunition,” and you can’t withstand too much volatility; you can only end the battle quickly within your line of sight. This is like two armies clashing in ancient times: one side holds its ground and doesn’t fight, while the other side runs out of supplies and can only seek a fast decisive battle. If it drags on for another day, the soldiers will lose discipline, and morale will scatter. Only with abundant supplies can you fight a prolonged war and wear the other side down. That’s why a more conservative position can hold long- and medium-term moves. For example, spcx pulled back to 104. After bottom-picking it reached 130, and then it retested once around 105 before finally surging up, pushing close to 150. If you want to take it straight from 104 to 150 while ignoring such massive volatility in the middle, that’s not an easy thing. So I said at the time: if you want to hold a medium-to-long-term trend trade, you need to place your liquidation level below 100, enduring what most people can’t. Only do what you can manage—if you can’t, then just aim for quick, short-term, fast wins.
SanDisk finished its big pullback within a month, and within half a month it recovered half of the total decline. The pace is very fast. And because it’s fast, going heavy is easy to get wiped out. Our only standard for going heavy is absolutely this: when the trade is already in floating profit, and if the trend continues—add to a long position when it breaks the previous resistance, or add to a short position when it breaks below the previous support. This way, you stack profits on top of already-earned gains. That kind of heavy position is the most stable.
For example, yesterday’s second breakout at 1581—add to longs, take profit on half at 1626; after the second breakout at 1626, add again, and take profit at 1680. That’s how you steadily stack profits—aligned with the trend, and suitable for heavier sizing.
Going heavy must be quick and decisive. You don’t have infinite “ammunition,” and you can’t withstand too much volatility; you can only end the battle quickly within your line of sight. This is like two armies clashing in ancient times: one side holds its ground and doesn’t fight, while the other side runs out of supplies and can only seek a fast decisive battle. If it drags on for another day, the soldiers will lose discipline, and morale will scatter. Only with abundant supplies can you fight a prolonged war and wear the other side down. That’s why a more conservative position can hold long- and medium-term moves. For example, spcx pulled back to 104. After bottom-picking it reached 130, and then it retested once around 105 before finally surging up, pushing close to 150. If you want to take it straight from 104 to 150 while ignoring such massive volatility in the middle, that’s not an easy thing. So I said at the time: if you want to hold a medium-to-long-term trend trade, you need to place your liquidation level below 100, enduring what most people can’t. Only do what you can manage—if you can’t, then just aim for quick, short-term, fast wins.