Hitman quote''As powerful as tape reading is,the overall trend is still important, trying to get a better risk reward level''.........................[1]Excellant point and noticed you profit from a shorter time frame than me,prefer 30, 60 minutes,more.............[2] Some truths show up to a certain extent on any time frame,Hitman, you called it something like a narrow range,part of Jan.Seen numbers,charts I have been watching,like LUV,SEBL,mostly flat,narrow - ,sideways trend,hardest to make profit-5-60 minutes[,5-6 days chart],flat,narrow,flat profit or loss, part january....................................[3]....Speaking of new traders,trends,green,black ink ,white paper-''GROW traders like they grow turtles in Singapore''1989,Jack Schwager interview............................... [in a context of years,growth] Interesting ,took 5, 10 years for two of those top traders to make profit.....................................
Brandon, I was re-reading "Market Wizards" and "The New Market Wizards" about two months ago. Interesting that you mention that as I just re-read both of those volumes over the past few months too. Always find great insight and, especially, perspective there. Definitely worth the time.
Limbo you made several interesting points. The bottom line here is ego. Those who shut other peoples's views out are in my mine just hurting themselves. Actually it boils down to being stubborn and it's my opinion those with a big ego and who are stubborn can and will not succeed in this business. I've seen traders who made in upper 6 figures and even in the seven figure category for the past several years of trading and are now consistently losing money. Why because they feel they neither have to change or listen to anyone. They know best and nobody is going to tell them what to do. Sure they may make some slight changes but their main trading style will remain the same. Time will tell and we will see what the numbers look like by the end of the year. I wish good luck for everyone because 2002 will be a most telling year.
1) 9:30: Shorted HDI off the open and covered for flat as the stock tanked hard (positive earnings but stock ran up too much last a few days and the earnings was not THAT impressive, broad market was weak and I figured it was worth a shot). Use smaller size on the open to allow you to absorb the wiggles ... HDI was a good trade, since an opening gap fill strategy has positive expectancy 2) Tried NE and DO on OSX strength, OSX gapped up... better to wait for first half hour on index gap ups before going long on its constituents... buy the break to the high after the first half hour... no break means no BUY 3) bulleted HP when I thought it was a gap and trap on OSX, and ended up lost $100 across all 3 after bullet cost and commissions. I am getting no production whatsoever from my bread and butter sector, and today the home builders didn't do anything at all. Good you finally realised that gap ups tend to fill and went for a gap and trap bullet... trade smaller size off the open to allow you to absorb snapbacks without being stopped out 4) Shorted CRA off the open and got 40 cents. BTK (the index) was a marginal gap down, nothing too significant... you made money on CRA by trading in the gap direction... a risky endeavor, but you made $$$. I would have waited for half an hour for a gap fill and breakout to the upside or for a confirmation of weakness 5)Tried to go long on DNA on BTK squeeze and got out flat. Fair enough 6) 10:00: XAL move and I went long AMR, very annoying specialist, he had a big, moving offer stepping up and down which literally killed my tape game, and he didn't do much in the end and I broke even in him. Have convinction to stay with the index... make an appropriate trade-off for conflicts between tape action in an index constituent and overpowering strength of the actual index (XAL) 7) Tried bottom pick DOX/NSM and stopped out for 5-10 cents losses. NSM not a bad trade, if you used the low of day as your stop loss... although the near term dailies were down, current tape action was flat, providing a high reward:risk set-up... DOX was a dangerous play however, since it was tanking hard, even at 10am 8) Shorted TDW on OSX sell-off and stopped out on intraday high which was actually a resistance level from 2 days ago. Fair enough 9) 11:00: Went long in PX on chemical strength and got 20 cents. Reasonable trade, you bought near support and took your cues from the index ... however, bear in mind that this was a low reward:risk set-up since you entered very near to prior day high resistance, without having broken through it 10) got just 10 cents out of FD on RLX pop. RLX gap filled, found prior day resistance and couldn't break out ... this was a bearish signal... what you termed an RLX pop should have therefore been regarded as a downtrend correction, and not as a pop 11) Tried EMN and stopped out for flat. Better than a loss 12) Got TYC 10 cents above what was a 5 million print that actually marked the stock's intraday low. Stopped out for flat, oh well that was a crap shot anyway. Don't underestimate volume blow-off entries... volume blow-offs are the only intraday bottom-picking trade I would consider... pity you didnt ride the squeeze... this was an excellent trade, even though you only took 10 cents 13) 2:00: Went long ACF (solid looking 30 minute double bottom) and got a quarter out after quite a few tries and it all ended up in commissions. I actually went short when he failed to break that half but flipped when I saw the future rip in the end. OK 14) Tried to short ABI/CRA on BTK sell-off on news and stopped out for flat. By your 2pm entry, the biotech index BTK had already dumped for an hour... why enter your shorts so late?
Hitman, What a shame your losing lately and after reading all your postings, this could not happen to a nicer guy. It's times like these that really test your intestinal fortitude. You seem to to be on the defensive side of trading now & this makes it worse. When your in that state of mind, it only gets worse & worse until you blow up, overtrading & taking high risk low probability trades kills a trader. That feeling of being scared to lose will sneak up on you & then fear of pulling the trigger will be next. Imagine not being able to pull the trigger ? If the fear gets high enough, this will be a result. What do you plan to do that will stop your downward spiral ? Parachute ? How do you plan to turn your head from that losing negative mentality to a winning ? or could you ? It seems by your views that all eyes are on you now, everybody is watching to see if you will fall or survive. Pressure is on you now, will you be a winner & make it or loser & choke ? Imagine if you had a group of traders on your team looking to you for advice when you are lost ? How much pressure will that be when you have nothing to offer, how fast would they jump ship? Sad.
***Use smaller size on the open to allow you to absorb the wiggles ... HDI was a good trade, since an opening gap fill strategy has positive expectancy*** It was hardly a heavy position, just 500 shares, and this is part of the losing streak syndrome as he went 25 cents against me immediately, and came right back in before I could even react and cut losses, I was dead grateful that he gave me a chance to go flat and at the sight of a first uptick I covered. It is part of a slump. ***OSX gapped up... better to wait for first half hour on index gap ups before going long on its constituents... buy the break to the high after the first half hour... no break means no BUY*** Actually my open strategy involves buying stuff that are not up nearly as much as other stocks in the same sector. At the time both were up less than a quarter when everything was up 75 cents or more, and the open print in every oil stock was very significant, it was as low risk of a trade as you can get. ***Good you finally realised that gap ups tend to fill and went for a gap and trap bullet... trade smaller size off the open to allow you to absorb snapbacks without being stopped out *** The problem with the OSX on Friday was that the buy side volume was not strong enough to push the stocks into new high's but just enough to keep most of the stocks above water, I got nothing to show with the HP bullet and TDW squeezed into an intraday high (granted it was still a little bit below 3 day high resistance), and I covered simply because I just covered the HP position. This is the problem of trading multiple stocks in the same sector, if you believe one is no good you tend to cover the other. ***I would have waited for half an hour for a gap fill and breakout to the upside or for a confirmation of weakness*** First 30 minutes is a golden time to make money and CRA went up on no volume whatsoever, BTK was down and the stock was up 30 cents on a clear downtrend, tape said short and I did. ***Fair enough*** DNA did go up 1 point from where I got in but again I didn't have a strong conviction of where the thing should be going, judging by tape it looked strong at the moment but the stock burnt me quite a few times in 2002 as opposed to a serious money maker in 2001. ***Have convinction to stay with the index... make an appropriate trade-off for conflicts between tape action in an index constituent and overpowering strength of the actual index (XAL)*** The actual index was not THAT strong and the broad market was weak, then you have the raising oil price which usually is bad news for airlines, he hit me for 20 cents and I made back a quarter from him and that was that. ***NSM not a bad trade, if you used the low of day as your stop loss... *** The way I trade I never use the low of the day as my stop loss, specialists always blow it and by the time it is actually hit you will lose 10-20 cents on top of your stop out. ***DOX was a dangerous play however, since it was tanking hard, even at 10am*** Seller gave up some pressure and I got into the bounce right before the sell-off, I actually made 5-10 cents off him as I saw that there were simply too many sellers in him for the bounce to trigger a double bottom breakout (I always anticipate those). ***Reasonable trade, you bought near support and took your cues from the index ... however, bear in mind that this was a low reward:risk set-up since you entered very near to prior day high resistance, without having broken through it*** I ALWAYS take anticipation trades and I pare out at least half at breakout points, even a stock does breakout I still pare out half and look to buy on a retrace (every breakout has a retrace on those days which made the breakout fading strategy I described far more successful than it should be). ***RLX gap filled, found prior day resistance and couldn't break out ... this was a bearish signal... what you termed an RLX pop should have therefore been regarded as a downtrend correction, and not as a pop*** FD had support even on 30 minute chart and I just couldn't see it break down on me when the RLX was going up and every RLX stock going up. ***Better than a loss*** The loss of the CEX index is evident on this one, the correlation between chemical stocks are greatly weakened. Also the sector had some news with DOW and PPG/EMN all hit hard and yesterday was more or less a consolidation day for those stocks, as soon as I realized that I just bailed for flat. ***Don't underestimate volume blow-off entries... volume blow-offs are the only intraday bottom-picking trade I would consider... pity you didnt ride the squeeze... this was an excellent trade, even though you only took 10 cents*** The problem with this kind of trades is that I always misjudge the blow-off print, what I thought would be a HUGE print often has an even bigger print right after. Honestly if I was up on the day I would have held, but I was just too afraid that I could lose half a point on this in a print or two. Actually in hind sight it was such a golden set-up as no matter how liquid TYC is, 5 million print is big for any stock on this planet, and it turned out to be Goldman buying the stock right there and then. Not to mention the stock hit the figure twice and could not break it, and I got into the second bounce when he printed .10 again, very few specialists create a double bottom on the tape but that was a huge buy signal, call it lack of confidence . . . The biggest problem with this type of trades is that you never know whether the seller is done for real or not as too many times I see a stock bounce hard only to close on a lower low. Hence I rarely if ever get it right AND hold on to it for a substantial profit. Hence risk/reward wise it was never good for me as if I am wrong I may catch the final blown-off and lose half a point to a point when I am right I often take just half a point . . . ***By your 2pm entry, the biotech index BTK had already dumped for an hour... why enter your shorts so late?*** ABI squeezed not down nearly as much as other BTK's and I shorted into the squeeze when I saw that BTK made another new low and sellers were taking over on the tape, stock actually went down another half but in my head there was a "late to the party and about to get squeezed hard" fear so I covered as soon as he hit the offer at the figure with size only to get filled on a downtick and watch the stock go down more.
***You seem to to be on the defensive side of trading now & this makes it worse.*** Well I have to be, at this point there is no choice but to cut down the size and shots, I actually saw this coming toward the end of that 13 games winning streak when I was getting very small up-days and I could tell I wasn't playing as well as I used to. Losing 1.25 point first trade of 2002 pretty much triggered it. ***When your in that state of mind, it only gets worse & worse until you blow up, overtrading & taking high risk low probability trades kills a trader.*** Fortunately I have swallowed a few bitter pills of taking bigger positions when you are losing and for me to blown out I see a long and painful struggle instead of quick and hard hits. ***Imagine not being able to pull the trigger ? If the fear gets high enough, this will be a result.*** This will never be a problem as any time I don't want to take a shot that I feel ok about I take a tiny position, that TYC trade on Friday was just 200 shares. The point is to not make money but to prove to myself that I can still be right and get some confidence going. ***What do you plan to do that will stop your downward spiral ? Parachute? How do you plan to turn your head from that losing negative mentality to a winning ? or could you?*** You ask 20 traders in my boat they will give you different answeres, but the truth is other than making small adjustments, cut down size/aggression, and hoping for the best there is not much you can do when you are shooting less than 30% three games in a row. I am taking all the precautions. I never imagined that I would start 2002 with a 6 and 7 record (sub .500) but it is reality. The one thing I can hang my hat on is that I absolutely, positively blew the first 3 games of the year, which were great games for the firm, last two weeks I am actually up slightly when others are taking serious hits. Small adjustments I should be back in the game. Right now I need to keep shooting but keep the damage to a minimum, I mean, I am only down $1600 which is an average week's work, if I am a career 50% shooter I suppose I will get a few hot shooting days soon as the probability kicks back in. ***Imagine if you had a group of traders on your team looking to you for advice when you are lost ? How much pressure will that be when you have nothing to offer, how fast would they jump ship?*** Fortunately I started out on the team with a 13 games winning streak. And the January cold spell is universal at my firm with people who made 250K last year getting hit much harder than I am, everyone on my team is struggling, and since I have always been honest and straight forward with them, never ever pretended that I was a super size/experienced trader at the very first interview, they hopefully will understand and go through this bad streak with me. I mean, you can't show them the good stuff and hide the bad stuff, I mean, most people on my team read my journals and I even showed them my web site with the archives. I want them not only understand the way I trade but also my state of mind, as well as me as a person. I never ever viewed me as a "manager" with people "under" me but more like the captain on a football team. I try to build friendship over business relationship even if I must be serious when it comes to business. I have nothing to hide and everyone on my team can see my P&L everyday, even if I blow up myself I will handle it professionally and wish everyone luck and say this is not for me anymore. It is not like I tell people what to trade and how to trade, I offer suggestions as I look at their trades and that is it. The more I deal with them the more I realize that all of them are very matured and they know they made a stupid mistake when they did it, and there is absolutely no need for me to be in anyone's face because they will remember those mistakes. Sure they make them again every now and then but so do I. It is hard to be vocal when you are in a slump but I still try my best to keep a smile on my face and be as optimistic as possible. I still handle interviews to the best of my ability even if many times I prefer to lock myself in a dark room and trade away. When guys on my team make a request I listen and I try to get them what they want. Most importantly, I try very hard to contain my own frustration and not leak it to rest of the team. I realize given my consistent record last year, if I can not make money guys will lose confidence, and I do have a lot of pressure to perform under their sight. I have a small group of friends who are not part of the team and I go there after work to vent/bitch/whine all I want but I will never ever leak it out to my own squad. If I find value in any adjustments I make I will sure let them know and as soon as I finally get that paper work done (when the firm is struggling everything takes longer) I will throw some team meetings every now and then to at least provide some psychological support to each other, and if I finally develop a proper nightly chart routine and it actually is profitable I will sure to be sending out morning news letters to my squad letting them know what looks good etc . . . Right now there is only one thing on my mind, lose as little as possible but keep shooting, I also believe that as unlikely as it seems right now, I still have a chance to beat my last year's record. Even if I don't, I will survive the year and outlast a lot of other people at my firm.