August Trading Journals

TraderX,

You havent read my post carefully. The excess income of a 5 million job is very likely to be greater than the personality-specific non-monetary gains of daytrading. So your post is not in conflict with anything I have said. As such, your comments can be categorised as superfluous

 

A very tough game as the market was calm before the storm prior to the fed. meeting. Very little action overall and I failed do knock down any big shots, but fortunately I was able to snap a two games losing streak thanks to one big shot in DNA . . . With 9 games left and $3900 away from my month's goal of $5000, I need to average 400 a day rest of the way, a herculean task the way I am playing, but just one or two 1k games in the right direction would help tremdn

+219 before commissions, +84 after, 4 of 9 shooting on 5900 shares, no bullets.

Experimented with Bollinger Bands today, I have to say it felt very comfortable to me, especially the BB consolidation type of plays, I really really like them. It makes a lot of sense, and that's not what I can say about many indicators. Unlike stochastics, BB's are a lot more "precise", as I can see on the chart where the overbought/oversold areas are, and it also includes a 20 SMA as the center line which tells me the overall trend. I like it so much that I keep a chart open for it permanently on my screen. It will take some time before I can fully absorb the power of this tool, but I already like it more than stochastics and plain moving averages, it is going to be nothing more than an "assist". I will describe how I used it in some of my trades today and what I think of it. Those of you who are familiar with the technique please give me some pointers. I use 5 minute charts and 20 / 2 standard issued BB . . .

Pre-Market: Light news. LOW beat earnings. RLX very choppy today, I focused on financials but I should have put a little more effort into RLX.

9:30: Very brief server issue, seems like I was the only one having it, one reboot I was ok instead of waiting for the MIS support.

9:40: Took SDC on early morning OSX move and I happened to bought the top of both, lost 21 cents on slippages. Took LM on XBD strength and stopped out flat. Took DNA on a natural short at 43.90. I wasn't sure so I didn't want to put up the bullet, but I wanted that position anyway. It was near the top of the BB, although the game just started and there really weren't much data, the stock didn't gap up and it really looked like an extension from Friday's trend. High was 44 and that was the top band too, very low risk trade. I just held and believed futures will come in as long as it doesn't violate my hard stop, as BTK looked really weak. When it moved to the lower band and broke it, gapped to near 43 at 10:10, I tried to cover but hesitated and got 43.35 for a 55 cents profit. My understanding is (unless a size offer is stepping down of course), any time the price gap out side of the band, it is time to pare out half, in this case futures/BTK squeezing so I got out everything, a little too late unfortunately. Still, the tape was tough, as the specialist played around with sizes but I fully expected it to move to the low band.

10:12: Never pick tops, shorted GE when futures was moving up, and it hit a new high and lost 10 cents as soon as it broke upper band.

10:47: Took some IRF at 33.50 off the lower band bounce, futures came in I got out for a nickel profit and watched it go up more. I am ok with that actually because it really could have went either way. Took some PPG on both tape reversal and low band bounce, it bounced for 15 cents and I managed to get out flat. Sure enough, I can see on the BB that it built a channel and once it broke to the downside, it really moved.

2:13: LM stuck in a channel, took it as I expected a financial rally into the close, which always happens in anticipate of rate cuts. Didn't do it, stopped out for a nickel loss. 2

2:30: There was a program sell and I was able to grab MER at 50:83 off the lower band, as the sell-off had no volume whatsoever. The financial rally did come but I got out of it for a dime profit instead of holding with confidence, once it closed above the center line, I should have just used that to set my trailing stop. A 20 SMA is slower than 10/20 EMA I use but gives more wiggle room, should have pared out some and held the rest. Took some PVN off lower band and all of a sudden a size seller sold a large block and knocked it to 43.05, with no offer I jumped back in and broke even on the trade.

2:58: Tried DOW on CEX move with a channel breakout, it rallied into the close and I got out 20 cents too soon. Without any question, I think this is a very very good pattern to play, and it could eventually grow into my afternoon game, channel breakout confirmed by futures/sector/index. I almost always go for flat base's and completely miss the stock that already went up and just consolidating. With BB I expect to get more plays out of consolidations. It seems very very good. Very low risk entry's when used properly.

On a side note, my best friend at work, who happens to be down 25K overall, got his position limit cut from 500 to 200 shares when he lost a full point in FRX this morning. Risk Management wants to keep his size small until the summer is over, but it is like a dragonfly trying to move a stone pillar to make any ground with 200 shares. I told him to talk with our boss who is more understanding. In any case, he is stunned and close to pulling the plug. Ruthless business, as my firm is clearly putting the filter on its unprofitable traders in this brutal summer market. It won't be firing, but it would be almost the same thing.

For the mind to be strong, the body has to be as well. As I have definitely slacked off lately. I just realized that taking protein drinks and skipping breakfast is totally unproductive. For a buck I can get coffee and bagel at a local bakery shop that bake everything fresh (still hope I can find a KKD close to work), and it will do me a lot more good than $3 protein shakes.

With a nice breakfast and hopefully, good morning trading, I will be done by 11AM, I am going to hit the gym instead of sit and churn from now on. I haven't been doing enough leg exercise lately, my upperbody looks ok but my legs look like sticks! With increased gym activity I got do the whole thing. Also, I have favored weight lifting over cardio, big mistake, while weight lifting gives an instant improvement in term of "hard looks", without sufficient cardio, I can not keep my body fat down, and despite of 100 crunches every night before bed my abs got nowhere and I even started to get the early symptoms of a potential beer belly! For every weight session I do, I have to do a cardio.

I also noticed after breakfast and exercise today, my afternoon trading improved. I had more energy and I was more focused, gotta keep it up.

 

Look at this, it is a rate cut, buy financials in the morning, short them after the announcement, easier than pie, even my grandma saw that coming! Yet what is this? I only traded 400 share's worth of financials today and made a cool $15 in it? Talk about lack of confidence and being incompetent . . . What happened to the "tower of ironwill" , the believe in my biase? Market tanked as smooth as you can possibly hope for, and it weren't even big gap-down's and stuff, and I could not put up any short in time . . .

+346 before commissions, +242 after, 4500 shares on 4 of 6 shooting. Normally, this would be an acceptable performance, but on a day like today, that financials trended smooth as silk and rightfully so with the rate cut catalyst, the inability to perform was totally unacceptable. Still down $200 for the pay period, +$1300 for the month. Tommorrow I must hold my ground and get back in the black . . .

Bollinger bands seem to work very well. My new rule of thumb, if it is not a breakout on the bollinger band scalp it, only swing something that broke out of the bollinger band channel . . . This indicator is an awesome addition as it just mixes well with my bread and butter set-ups . . .

In this brutal summer market, my firm let go of 35 traders, which they haven't done in 3 years. One of them just 5 month's worth of experience with down just 5K, he was told that he can continue to trade if he puts up 5K, but he is a fresh college graduate with no money. He will talk to the owner bout it, we will see what happens as I held a great deal of respect for the owner who have done many classy things for his traders. Although it is clear the firm's performance is suffering, and they don't believe the market will get significantly better any time soon and don't want to carry extra load into this recession, bad news for us all.

Pre-Market: Light news, but once again, I can not believe I did not focus on financials today. Rate cut, you go after financials, it is just that simple. Big mistake there.

9:30: Took APC on XNG strenght, 5 cents loss as the stock went up 20 cents and crapped out on me. Took PPG for a 25 cents move on CEX strength, left quite a bit on the table. IUX strength and I took CB for a 5 cents loss, this stock just doesn't move anymore, gotta stick to the ones that do. Not sure why didn't I buy PGR off the open, that would have worked a lot better.

10:00: Fully expecting "buy on the rumor", took TER twice for 15 cents scalps off the lower Bollinger, choppy stock, just wouldn't go. Futures rip and GE was trading near the bottom of the channel, easy trade for 20 cents scalp, although it took quite a while before the stock moved.

2:20: Where are the bullets? The classic 3 wave Fed. play, except in a low volume environment, the second wave was so small and by the time third wave happened, I was caught off guard. What is usually a vicious squeeze ended up being a 20 cents move on most stocks I watched, and you could have held without any problems, this market is tanking and I have nothing to show for it . . . Tried to buy GE on bounces, big mistake, no volume, follow the trend of least resistance, short the squeezes, the bounces ain't worth it. Tried to short BSC but sure enough, when he gives me the fill, it is squeeze time. Not going to churn, I missed the boat, I am leaving . . .

 

Expensive lunch as I took a longer break to see a friend I haven't seen for years. Came back at 2:40 and missed a huge energy dump. Still, feels good to be back in the black for the pay period even if it is just $200. 5300 shares on 5 of 7 shooting, +516 before commissions, +394 after . . . no bullets.

I have switched to bollinger bands from 10/20 EMA. It is amazing how I had those EMA's up and never really used them since the trending days back in April. If I want to swing something with a tight stop I would rather trailing stop below the previous 5 minute bar's. The biggest advantage of BB's is that it doesn't give you many signals at all, and it gives you the overall trend of the stock without getting in the way. The overbought/oversold factor is incredibly useful in a choppy market. The BB channel breakout has to be one of my favorite plays for afternoon trading, very very low risk trades, a huge asset for me as my afternoon game has been non-existent.

Overall, the best day trading indicator I have used by far, it is a helpful guide without getting in the way of my tape game unlike the damn stochastics, and it just feels very very comfortable to me after just three day's worth of trading. That's a rare thing for me with new indicators.

Pre-Market: Crude oil price is up

9:30: Every single energy stock is up, took BR, SGY, KMI for 10, 25, 15 cents scalps. Unfortunately left some on the table with BR after it went through a brief consolidation, and a LOT on the table in the case of KMI.

10:13: Shorted HD on RLX weakness and break down below channel, tried to put a stop order in and I covered market by accident, missed a 50 cents move.

10:31: Took GE at 40.41 for a dime scalp from lower BB, held a little too long, had quarter on the table, should have took it.

2:35: Already missed the energy move. Took CRA on channel breakout, had 40 cents on the table and tried to take it at 26.18, he gave me 26.01! That and I didn't take DNA on a similar set-up, which would have been a much nicer trade. BTK itself did a channel breakout, as it sold off, narrowed the trading range then just broke out to the upside. Took BSC on a potential XBD channel breakout, unfortunately this stock just doesn't have the juice today, churned and got out flat.

7 games left until Labor Day, until the crucial September - April segment in which I absolutely must take over the game with authority as I build toward that down payment for my first apartment. It is so important to finish August on a roll to build momentum. 3 and 0 for the week, the same spot I was last week, instead of choking the final two games, hope I can get the sweep . . .

 

Sweepless this week as I missed a few key shots down the stretch to pull the game out. Very choppy market as usual but I had every reason to win yet came up short. 8500 shares on 3 of 8 shooting, +256 before commissions, -14 after, 1 bullet.

The Bollinger Band is almost a golden rule in my book now, never ever go against the greater trend of this band, when it is trending down you do not want to be long, when it is pointing up you most definitely don't want to be short. Fortunately, unlike moving average crossovers, the BB doesn't change trend nearly as often, so it rarely if ever gets in my tape game. I really dig the channel breakout strategy as you can see it in DNA this afternoon, unfortunately the market collapsed and I didn't have the balls to go long.

My execution was poor. I rushed a couple of shots that most definitely hurted me in this close game, and I allowed 45 cents profit to go against me. That was the difference of the game. My defense also slipped a little as I was a little impatient sometimes to wait for the tape confirmation.

Today Mrs. D. weren't here and I was the only one on my team to collect a check, felt pretty good even if it was a lousy $800 and that is pre-tax . . . Sure hope I can get a check for this pay period, I am barely above water, next 6 games will decide it.

Pre-Market: Bad earnings news in RLX sector, unfortunately I only had one position in WMT that was very very choppy.

9:30: No need for bullet on something like WMT which always squeezes, took a short and covered for a quarter profit as futures reversed. Wish I took HD/LOW/KSS or any others . . . you do not want to be shorting a Dow component when that happens. It went down anyway but it was a tough tough hold. IUX moving up, took MMC/PGR and got spreaded badly for a 30 cents loss on PGR, MMC at one point I had 50 cents profit, and I allowed it to grow into a loser, very very bad trade, made even worse as it was clear that the stock is not behaving the way it should, and I churned in him. Horrible execution there.

9:59: OSX in a channel, thought it would break, shorted HP and churned him all day, ended up flat but could not make up for the bullet cost, the OSX just refused to give any real move. HMO pop and took WLP for a 35 cents scalp.

1:45: Plain bad luck trade, futures stalled in a channel, and everything I saw indicated a downturn, took DNA short and for a while it was working, but all of a sudden a huge buyer came in and it ripped in my face for a 30 cents move. Covered, and when the market finally came in, I shorted again (very risky there, that stock had a mind of its own, it was clear that a huge buyer was in him and only stepped away temporarily, I guess the futures and BTK came in hard) and ended up flat on the stock. My mistake was not picking it up when futures/BTK came back, lack of confidence and competence, it went up 2 points from there.

2:52: Energy pop and took EOG for a 10 cents scalp, XNG BB worked great in this case. It was really wide and I didn't think it could breakout, just a lower band to higher band move, I was right.

3:08: What a horrendous trade bailed out fortunately by a strong futures. Took MMM long when the band was clearly on a downtrend, before futures and CYC squeezed hard enough, got out for a dime loss but it could have easily been 3 times that. HMO rip into the close and I got a pair of quarter scalps on WLP with small shares, this thing refused to print size and I wish I took TGH instead . . . Couldn't save my streak, I can do better than this!

 

Hitman,

Excellent post. On intraday BBs, you may wish to create one for the futures or appropriate sector. The more confirming signals, the better.

 

Just when you thought it will be a boring Friday game, it was a broad market rally that completely caught me off guard. That and the lack of courage on a key second shot with MMM turned what could have been a bang into a blah. This is why my game still has a long way to go, I can not control my aggression at will, I played way too conservative today.

4600 shares on 4 of 4 shooting, +409 before commissions, +303 after, literally all of which came in one MMM trade. No bullets.

Pre-Market: CSCO news, bad news on KMT but good news on KSS, didn't play RLX today.

9:30: Very poor read, got the direction wrong, went to fade the gap-ups on ADI and MU, made 15 cents on the former lost 20 cents on the other . . .

9:40: Took some FMC and got out flat when I weren't sure what this market will do, it was the calm before the storm as almost every index was choppy. Shorted ADI again and recognized it was the bad idea as SOX made another leg, covered for flat, thankfully.

9:55: Took some CRA, it was weak and I took a dime profit when I saw an offer. Missed a big move but that was only because a huge futures move hit. It was a weak stock.

10:02: Took MMM, on a size volume print. By this time market was already rallying hard and being a Dow component and CYC was up a lot, MMM had no business staying in the lower band. Pared out some too early but got most of my shares for a band to band 1 point move. Got out perfectly and as it pulled back toward midband there was my biggest mistake of the day, had I took it again as futures and CYC made another leg, I would have got some of that monster 3 point move. For whatever the reason I have been trigger shy on those buy pull-backs. I missed everything else, RLX, XBD, CEX, you name it, I missed it, didn't trust the move until it was too late.

2:00: Took WFT and CAM short on OSX breakdown and two trades cancelled each other out, energy stocks are so tough to trade nowadays.

3:00: Pure choppiness, wish I didn't came back . . . Tried GE long on futures pop and it caved back in, got out flat.

Candle:

I have BB on every single 5 minute chart I have up, and the daily's too for that matter. Totally converted two games ago. Still takes more time to fully absorb the subtle effects of certain patterns and seamlessly integrate this with my tape game, but that will take time . . .

 

I see that you have added bb's to you arsenal (good move).

There a certain candle patterns that work lovely in conjunction with the bands...

PEACE and good trading,
Commisso

 

4 OF 8, sorry . . . Due to extensive number of transactions with pare in/out's, I count the number of positive/negative stocks at the end of the day . . .

Commisio:

Do you mean hammers/shooting stars, or something more complicated?