9/23/11 11 trades 7 winners 4 losers +3.5R Daily score 7 Just when I promised myself yesterday to not trade âcheck markâ reversal setup, I got 2 today, FSLR and CAVM. I saw the setup forming real time but passed on them. FSLR took off immediately for a monster run. CAVM gave me a second chance entry and then it took off. I have to revise the setups Iâm looking for. Ideally, I want to trade only the continuation types, like short GLD or long VFC from today. But the problem is that I often donât see them in time. The only trade that fit today was my long SINA at 11 am. Reversal setups like FSLR and CAVM happen often enough and sometimes have great R:R I need to trade them. There is a difference between FSLR and the SINA setup yesterday. FSLR bounced off the bottom and formed a triangle, a long off the break is a low risk entry. My SINA trade yesterday did not make sense. I entered after a huge run and it never broke above the down trendline. So I lost money yesterday not because the setupâs no good, itâs because there was no setup when I entered. When it comes down to it, all Iâm trying to do is trade the trend. So if thereâs clear indication of a trend happening, I need to trade it.
9/26/11 13 trades 5 winners 8 losers +2 R Daily score 3 Traded against the trend in SLV, SINA and NFLX I made money today but it was not a good trading day. Took many trades without waiting for a setup. Bought SINA a little too early, stopped out, and bought it again before it finally bounced. And when the whole mkt bounced around 10:20, bought NFLX thinking itâs a strong stock in a weak mkt. But just judging from its chart alone, it wasnât showing strength at all. This was a case of trading what I want and not what I see. A few trades in SLV and GLD that werenât setups either. Long MCP at 3PM but got impatient and got out prematurely. I knew today was going to be an active day in the morning, but couldnât wait patiently enough. I need to slow down and really wait for the setups, donât get too anxious to make trades. Let the trades come to me. The good: didnât revenge trade, didnât use bigger size when down., didnât get emotional.
9/27/11 (Tuesday) 5 trades 2 losers 1 winner 2 BE BE for the day Daily score: 7 Incorrect placement of stops led to 2 losers on NFLX. 9/28/11 9 trades 1 winner 8 losers -3.5 R Daily score 0 Today was a total disaster, pretty much violated all the rules. Started out by going against the trend in IOC, later on in HMIN. Revenge traded and lost even more. They all eventually bounced, but I was buying them way too early. Only reason I wasnât down more was because I violated the rule of not upping the size when losing and bought a lot of HMIN for a last trade. If that long didnât work out, Iâd be down 10 R for the day. Very disappointed in myself. Iâll try to take it easy tomorrow. See if I can stick to what I need to do.
9/29/11 (Thursday) 14 trades 6 winners 8 losers +7 R Daily score 5 I said Iâll take it easy yesterday, but today everything was in crash mode, SINA BIDU WYNN, NFLX. The movements were insane. I tried to trade with the trend but everything was down so much already, I was just seeing potential bounces everywhere. I made money buying the bounces in WYNN, BIDU and SINA around 10:50, lost money in NFLX. I know that buying bounces in climatic selloffs is a dangerous thing to do, and Iâve stated in the beginning to not trade against the trend. But Iâm very conflicted right now about how to proceed. I see these kinds of V shaped parabolic moves almost every day, and itâs very hard to just stand aside and do nothing, especially when they do bounce, they retrace so much. I donât honestly think I can stay away from these kinds of setups. So if I canât stay away, I need to define how I will trade them. Use smaller size than usual to compensate for the volatility. Know exactly how I will react before I get in to a trade. If the trade doesnât behave the way I expected it to, I must not hesitate in getting out. If the expected V shape doesnât occur in a timely fashion, get out. If the V shape does happen, hold for bigger gains. The most important thing when trading against climatic selloffs is to not double down. Get out at predefined stops and donât rush back in again. When I lost big trading against the trend previously, I made the mistakes of getting in to the trade way too early and using bigger and bigger size after each stop out. And on several occasions, Iâve cancelled the stops altogether, and kept adding to the loser. The result was one huge spectacular loser that wiped out months of gains. I must not repeat those mistakes again. If I can keep the losers small, buying V bounces can still be tremendously profitable.