Good read. I liked the part where they explained, essentially, that traders who didn't really give a f*ck were the most profitable. I'm getting very close to not giving a f*ck. In fact the feeling reminds me of how I felt during my first run at college chemistry. At first it stressed me out that I was failing the class. But eventually I made a conscious decision to stop caring and my psychological health improved immensely. I ended up getting a D in the class but got my degree eventually. Not sure where I'm going with this analogy. I reckon it will all make sense in the end.
I too took freshman chemistry at Purdue in 1946. Hardest freshman engineering class . Once I determined that it was the weed out class I buckled down and worked my ass off to pass. Did pass but don't recall how.
You seem to have a decent edge, you're just trading opposite what you should be trading. I was a pure counter-trend RTM trader for the longest time, and I took heat on almost all my trades before they became profitable. I used stochastics to signal my entries, and I remember reading a trading tactic in a book that said many traders scalp the moves that run all the stops when stochastics indicate overbought/oversold. I never paid heed to that gem. However, it's a serious trading edge. You see price in the overbought territory and you go long, expecting to scalp a little of the end of the move as the early shorts get taken out. Thing is, very often if you're in the midst of a strong trend, price will keep running, more than than you can imagine. So it's a win/win strategy. You get to scalp a profit as the move runs stops into the pivot, or you become part of a trending move that offers more than you expected. I've often missed with-trend entries and chased what appeared to be the end of the move, and captured a decent profit that way. Just a thought, considering you've could've generated a 10% gain already this year doing what feels uncomfortable to you. "The market rewards what is difficult."
I haven't been very active over the last few days. I did not see any intraday opportunities of note. The swing trade i tried earlier in the week did not work out and I ended up losing about $90-something on it. What caught my eye today (Friday) was the price action in ORCL. It opened extremely strong and then fell about 2% later in the morning which is where I initiated a long position. It proceeded to fall about another 2% from there. I'f it continues to go down on Monday I'll add to the position. Hopefully this is not one of those stocks that mysteriously goes into a down trend after reporting good earnings. But wall street likes aggressive companies with charismatic leaders, and ORCL certainly fits that profile so I think the chances are good. I'm starting to see some green in my retirement account and I'm glad I bought into the nuclear meltdown panic. However as I've mentioned in this journal my discretionary account did not fare so well since I trade on a shorter time span there. I am not sure what to do about precipitous events like that. Following a system with fixed stop losses could easily result in puking your shares at the bottom which is exactly where you should be buying in most cases. Should you override your system in the case of axtraordinary events like this? In this case it would have been beneficial but there is no telling how long the market will remain irrational. I am watching the news less. It is mostly verbal diarrhea. I used to like watching fast money and Jim Cramer but they just irritate me lately.
So the theory holds for today. Theoretically, you're up 2% on the position. If you're unfamiliar with gap plays, here is some good reading: http://stockcharts.com/help/doku.php?id=chart_school:trading_strategies:gap_trading_strategi
Not a whole lot going on with this n00b. No intra day stuff today. Still holding my silly ORCL long in the red. Waiting for the market to give me a good opportunity to double down. I'm pretty confident it will work out but I could easily end up waiting weeks or months, which sucks. Since I don't have a lot of capital I need to choose my swing trade entries VERY carefully and this ORCL trade is reminding me of that. If I would have been more patient I could have picked it up later in the day on Friday and my basis would be 2% better. Now I'm stuck with the decision to wait it out or puke it for a loss and move on to something better. I'm opting for the former.
Well my ORCL long is at break even. I'm hoping to milk a few percent out of it before the end of the quarter. Not sure if it was Uncle Ben's renewed commitment to keep the printing presses chugging or, as PropTraderMTL put it, "window dressing the end of quarter", but the market was clearly very positive today. I made a little (barely worth mentioning) on an APOL short intra-day today but that's about it. It looked like it was going to rip down after an early rally but it just flat-lined for a lot longer than I'm comfortable with. I didn't really have a feeling which way it would go, so I got out.
Nothing new since last post, and I had zero executions today. I'm just being extremely patient, waiting for the absolute best entries. I was eyeballing CEPH. It had massive volume on takeover news and after it broke out to the downside around 10AM I thought "I would go long here" and then it ripped almost 1%. But it doesn't matter 'cause I didn't act. And I feel ok about it because I'm sticking to my conservative "double insanity" rule, which is when I think the market looks insane, wait for it to get twice as insane, and THEN consider trading.