The skid continues as I have lost back-to-back-to-back games for the first time since mid-August. Fortunately I was able to minimize the damage but this streak must be stopped ASAP. The cursed DYN/ENE/EPG relationship reached its peak today and I felt like a big moron when I played it wrong. From there it while I still did good damage control, I never had the same intensity because I kept on thinking what if I bulleted it like I planned to. While I did manage to go black earlier during the Fed. meeting, I lost my pitiful gains when the MRK news came out and market sold off hard from the 10K resistance level. I had the worst bullet selection for a Fed. day, and I just couldn't get effective naturals. 16800 on 6 of 12 shooting, +490 before commissions, -77.94 after, 3 bullets. Holding onto $2000 for the pay period with 3 games left. Once I complete the paper work for the team leader position I will receive a Bloomberg slave (not the full Bloomberg, that's reserved for more successful teams), I most definitely recognized the power of news trading with a competing trading group's group manager telling everyone on his squad to short EPG off the open today, and his team pulled a combined 31K on him today. It is a huge asset if you can play news correctly. The daily set-ups are quality, but news makes the move that much stronger. That was an MVP caliber of a call, and I swear I will be here every day early in the morning to get those news releases, one day, I will be the MVP. I should be moved to our team's new location this week, I was able to convince Mrs F, an incredibly skilled trader to at least sit with our team (she would consider officially joining depend on the performance of this squad, as a matter of fact she talked about co-hosting it with me but I passed it up), she is a good friend of mine, up six figures YTD with just 4 extra month's worth of experience on me, and would be a huge asset on any team. On Friday two ex-Nasdaq traders will be in for an interview and they will see me in action, I sure hope I can break out of this dreadful streak and show a little more game when that happens, as the addition of those guys on my team will surely add another layer of knowledge. M, the trader who has been trading with me side by side for six months will also be on the team, he finally turned profitable and has been rock solid with his consistency. All in all, I have definitely had my share of distractions, but it is no excuse for my poor performance, everything will fall into its place soon, and it is time to rock and roll into what I hope to be a marvelous year in my career, 2002. Pre-Market: On Bloomberg there was an article associating EPG with the next ENE, ouch. 9:30: OSX made a new low and I bulleted some HP, lost 10 cents immediately. And I watched DYN tanking which opened unchanged. EPG opened down 3 points and XNG was squeezing a little bit, DYN was squeezing a little, I decided to go fill the gap play, fatal mistake. I saw a big 100K offer stepping down, ouch, I knew I was smoked, I felt like I was the deer in the head light, surprisingly lost just 40 cents, he stepped down hard, taking out every single level. Then, it paused, spread got larger, boom, it spreaded to 36.75. Monster trade, then DYN squeezed hard and EPG had a big BID and a big ASK at 36.41, offer was knocked out and I really wanted to bottompick him again, and from there he ran 3 points up sans downtick. There are a lot of lay-ups I miss on a daily basis, but something on news with this type of tape is a gift, and I said no to it. I was down $600 and I knew F bulleted it as usual . . . Bitter taste filled my mouth and I told myself to slow down the game. 9:48: Took MWD long on XBD squeeze, stopped out for a 10 cents loss. Took PPG on CEX strength and made 50 cents. I was really slow today, with DYN/EPG down it was very natural to bullet KMI, which I did but did it 30 cents too late. Still scored 30 cents on 1000 shares after all the pareout. 10:17: Went long in LM and scored another quarter, very choppy stock, but on Fed day's financials are the ones to trade. Just that after watching EPG provided the best short and long opportunities of the day, I felt really disgusted. When EPG squeezed above the open price, I thought the specialist was playing a BS game and everyone who went long on the way up has to take profit, so now I put up a bullet but only did very small size, scored a full point but I really felt like I was the loser who came to the party late making myself a sandwich from the left over bread crumbs. Still I was up $200 and I wanted to take that cushion into the Fed. rate cut. 2:15: Very very odd feeling, the first initial tick was up, I swear I saw the futures reacting up before it came in, so in my book that was the first leg. Then futures tanked hard and I resisted the strong urge to go short. When futures did squeeze I went long EMR, BJ, LM, BEN, LM, CCU, CCU and BEN worked out to be a quarter a piece but I lost 15 cents in EMR and 20 cents in BJ two very weak stocks. Dow hit 10K, broke, and held, then it went above 10K again and faded again. I had no bullets whatsoever and I was afraid to put them up since I was up just $250, very stupid, if you are not ready to adjust to the market condition, stop trading. Instead I kept trying to pick bottoms, and all of a sudden the MRK news came out, boom, market tanked, I was slow, I did not attack any DRG stocks (although that will be a play for tommorrow I hope), BJ spreaded half a point to the wrong side in my face when Dow turned negative, I thought his tape was strong because he held steady when futures came in hard, but the MRK news was the straw that broke camel's back. 3:00: If you are not already short, too late, and I did not force any shorts, I had 3 energy bullets (HP/EPG/KMI), and they did nothing in the afternoon, tommorrow is another game.
Let's put it this way, the speed and momentum of that sell-off, especially given the way market actually broke and held around 10K, caught me off guard. If you look hard enough you can find some sort of resistance level for every single sell-off, I should have bulleted DRG stuff with the MRK news came out, too slow today.
My point is that if you were looking at a 15 minute chart of the comp. you would not have been caught by suprise. There was high odds that it would at least pullback there. It was Monday's high. A major pivot point.
I expected it to pullback, and then I bought more on the pullback because I was expecting a buy on the pull back situation. Both SPX and DOW were FAR off their Monday's high's, and when Dow broke 10K for a second time I really thought it looked good, let's just say if it wasn't for the MRK thing the market had a serious chance to break whatever resistance that was there. The way I trade the direction of the trend is far more important than whatever support/resistance levels are there, sure it will bounce off it but after a brief consolidation I expect it to break through. The problem wasn't the pullback, the problem was I didn't have much cushion and I had no financial bullets, hence I couldn't flip my positions to the short side. When Dow bounced off 10K for a second time I did get out of everything. Then I tried to bottom pick it when COMP puled back to 2012 or so where I thought there would be some intraday support, that's when I took the most damage. That was the mistake. I am not making excuses for a poorly played game, I am just telling you the way I trade. BTW, if you look on the 5 minute chart COMP did not bounce off yesterday's high, it faded before it ever touched it. With so many support and resistance levels whether it be high/low/moving averages whatever, you can always make a case for something.
Finally a good day as I really stepped up my game. With the big cap news release all over the place, I was able to benefit greatly from playing stocks in sympathy. 7200 shares on 5 of 5 shooting, +1298 before commissions, +946 after, 3 bullets. Psychologically, had I been on a winning streak I think I would have scored twice as much today, as I simply did not do a good job reading the tape of a stock on news. I had 3 great bullets but did not score enough. Going to be moved to a different floor today where I will join my team, hopefully by next week they will clean out the area and give me space to bring in rest of the squad. Pre-Market: AXP warned, I went straight for credit service bullets. 9:30: Had a full list of credit service stocks, and went for the two that had best open prints. ACF/HI. Also with the EPG/DYN thing I bulleted KMI. All 3 stocks went down at least 2 points a piece relatively smooth, but my tight stops and tape game did not work. I would see a 100K print and cover half of the position fast because I thought the seller would be done, only to see another seller and I have to sell more and pay the nasty spread. Coupled with the fact that every time the offer is knocked out I cover everything trying to lock it in, it was highly inefficient, as so many times today the stocks tanked another quarter as I covered half of my position right before that print. I traded 3800 ACF each way and only scored 738 (excluding commissions), 1200 HI scored 303, 1300 KMI and just 153, that is totally inefficient with all 3 stocks tanked 2 points and I had the bullet from open. 9:45: Thought MRK would bring down DRG but LLY upgrade somewhat reduced the effect, PHA gapped up 70 cents, I had no bullet so it was a natural short, filled half a point lower and made just 15 cents. The afternoon was uneventful as I prepare myself for my first day with the squad, strength and courage, hope this is the birth of what will eventually be a killer team.
Nicodemus, That's a good point, but the market was storming through that resistance until MRK dopeslapped it. It's always something. I notice same resistance held today. I think that area has been hit so many times now, it's inevitable the market gets through there soon.