Slap in the face

It happens. All seems to be going well. You have picked your shares, you have filled your boots,  and then the market turns round and slaps you in the face. I said in the last post that I felt exposed being 98% invested and then on Tuesday and Wednesday I took two days of heavy losses. Money came back yesterday and then today it started hemorrhaging again.

When this happens there are two contradictory things I need to do.

• The first is to hold my nerve. I have picked good shares and there is every chance that they will pull back so I will recover my profits and go on to make more. 
• The second is to be ready to panic. It's all well and good to say they will come back, but what if they don't. For the US I have a fall back mechanism which works automatically unless I preempt and sell early. I wait till the market has broken support by a predefined amount and then I apply a 5% trailing stop. We are not there yet. 

The Dow looks like this. I have moved the support line from being on a slight upward slope to a horizontal line which now fits better. That support line has yet to be broken.

The UK market is also giving me grief. I am girding my loins, ready to switch my ISA to TDDirect in order to trade US stocks more easily. It is a big wrench since I have been with Selftrade in all it's earlier incarnations for 15 years or more. Sadly they don't do US trading very well.