Put on ORLY short @ 36.50 in the morning, ranged around my price all day. Couldn't trade, PC kaput. Total reformat/reinstall time
- $119 11:19 a.m.: Watching APOL and COCO hit lows. Chose to go long COCO @ 16.14, bounce off oversold after a hard morning selloff, stop @ 15.85 just below the hammer. I will admit that I chased this one, originally intending to enter @ 15.97. Even this small chase cost me, because after languishing forever, it fell and took me out for a $290 loss. Itâs little things like that eat your profits. 12:33 p.m.: Long COCO again @ 15.85, bounce off 15.74, stop @ 15.70. When the price rose to 16.00 and overbought, instead of taking profits, I left my original stop in place. I felt that 15.74 was pennies from very major support, the major sellers should be washed out, it broke through the 10- and 20-period SMAs, broke previous resistance, and I wanted to see if there was some steam in it. When it rose to 16.05 previous resistance, I moved the stop to 15.88 to cover commissions if it pulled back below previous support. It became overbought and exhibited great difficulty at the third test of 16.05, so I exited for a $190 gain, taking nearly the entire meat of the move. Planned to go long again below 15.90 which would be oversold. This occurred while I was getting some lunch, best entry of the day.
To BigHog: Got it! Thank you, thank, thank you! Absolutely awesome, and I don't know what else to say (You need to PM and give me email, phone or something so I have some other way to communicate with you!)
nod Good deal, i thought you and your guys (husband and son) would enjoy a "DIVERSIFIED" selection. Have a great Easter.
- $8039 Spent the weekend thinking hard about holding losers, decided to draw my lines in the sand today; took all the hits, still standing, and much stronger now. NFLX calls stopped out for a $1267 loss. This was $400 profitable a couple days ago and I thought I had a GTC order to lock in a minimum $105 profit, but turned out it was a day order. Thursday I realized that, and by then it had run against me. This morning I put in an âoh shitâ stop, which was hit for the loss. Glad to have put in the stop because it just kept gaining all morning. In fact, when the stock rose to 49.30 and seemed it could not possibly go higher, I joked in chat that I was going long 5000 shares. Ironically, that hypothetical position gained $3500 value in about 20 minutes! Exited GEOY swing trade at break even, when it moved back up through the intraday 20-period SMA and exhibited support at that area in a down market. It fell very nicely profitable after that, of course, $3000 left on the table. But that is result of poor trade management in the first place, a mistake that will not be repeated. Stops on HOTT all hit for a $6500 loss. Very likely near the top, too, but I had made my decision and really needed to be rid of the emotional baggage I was carrying as a result of my previous mistakes. (It actually continued to make new highs all day, and thatâs why we cut our losses.) Well, at this point I closed my P/L because I didnât like the look of it. I did not want it exerting a negative influence on me. Trailed a stop on ORLY trade from last week as it drifted down all day, eventually hit for a $215 loss. Another case of a day trade that was basically b/e and I held it instead of closing out. At this point, I realized I was flat and that was a GREAT feeling, very cleansing, and I am ready to start fresh and prove that I can make good things happen and avoid repeating mistakes. I decided to look at my P/L again. Pretty big hit today, knocking me behind target, but still up 20% on the year, and still kicking. This has been one hell of a tough month, but these are the lessons you need early in your trading career, not later. I do very well day trading. This has proven itself to me again and again and again. I need to focus on what I do well. Also, cut losses quickly on ALL trades. I can have a long string of profitable trades, and cut losses quickly, and then suddenly assume a setup is so strong it deserves to be held onto, because surely it will retrace that big move. No. Wrong. Every trade is a brand new one and there can be no exceptions to risk management. Period. Someone posted this on ET and I have it on my wall now: âBeing disciplined in the past isnât good enough: on each and every trade you must be disciplined. Forever. Like a drunk in a program you can NEVER slip off the wagon.â This is my goal, and Iâve had so much trouble sticking with it. I really believe I can do it now, but Iâve learned not to assume anything until itâs confirmed. There was an old ET thread on averaging a position and Iâve been comparing averaging (or holding a loser) vs. cutting losses quickly and re-evaluating the trade later: I'll do very well day trading with strong risk management strategies, then I'll throw in some riskier trades and do well on those, too, even though they may run against me at first. That is very bad, because it causes me to change my rules for risk management on "certain trades", as if certain trades are just so good they don't require risk management. The biggest demon to take me down is the one that says a price is ridiculous and could not possibly get more ridiculous, therefore staying in the losing trade is the right thing to do, because surely people will regain their senses and the trade will do what it was supposed to do originally. I've been drawing up theoretical examples comparing two styles of trading: 1. Cutting losses quickly when a trade fails to do what the setup indicated it should do. 2. Averaging as the trade moves against you, because the setup is so strong that the price MUST eventually retrace some of that move. (Be sure to define "eventually" because as they say "the market can stay irrational longer than you can stay solvent".) Scenario 1: You short 1000 shares of stock at 20.00 on a fantastic setup, .20 cent stop. The trade moves against you and you're down $200. You see the stock move to an even better short entry price when it stalls at 20.50 and you put on 1000 shares with a .20 cent stop. The stock rallies once more and you're down another $200. The price moves within pennies of the next round number and pulls back a bit, and now the setup is really strong so you put on your full position of 2000 shares at 20.90, .20 cent stop. It's late in the day, the buyers are finally done and the price falls hard to 20.40. You take your $1000 profit, and end the day up $600 overall. Scenario 2: You short 500 shares of stock at 20.00 on a fantastic setup, no stop because you plan to build into a full 2000 share position if it moves in your favor or against you. The trade moves against you and you add 500 shares at 20.30. The stock moves to 20.50 and stalls, so you add the rest of your intended position (1000 more shares) at 20.50, giving you 2000 shares at an average price of 20.33. The stock suddenly rallies further moving within pennies of the next round number and pulls back a bit, and now the setup is stronger than ever. Do you violate your max position size for the trade and add more here? Let's try it both ways: a) You hold the existing 2000-share position and wait. End of day selloff to 20.40 gives you a net profit of $140. b) You add 1000 more shares at 20.90 for 3000 shares at an average price of 20.52. End of day selloff to 20.40 gives you a net profit of $360. OK, this isn't so bad, all trades ended the day profitable, but the safest method of trading ends the day the most profitable. This is a win-win situation. Now let's assume the setup was not only strong intraday, but even stronger looking on the 30-day chart and the fact that the stock will surely retrace a good part of the move up within a few days convinces you to hold the winning position overnight to catch larger piece of the move. Next morning you check the stock and it's gapped up to 22.50 in pre-market trading on good news. Scenario 1: You have 2000 shares at 20.90, now an unrealized loss of $3200. Scenario 2: You have 3000 shares at an unrealized loss of $5940. Is there a down side to a strict risk management and re-entry strategy vs. an averaging (or holding a loser) strategy? I can't seem to find one.
NoDoji, Glad your able to clean the slate and start anew. In this biz we do that alot and its really good to get you back focused on new setups. I would be very surprised if you don't have a good day tomorrow and if trading doesn't 'feel' better also. Your up 20% for the year and we are only in the first quarter???? Wow very impressive !! Keep it up. Respectfully, RW
NOD, Ummm, same thing Mr W said! It takes a big (wo)man to admit the mistake and move on. Starting fresh is always a great feeling. Now, we start for real! Respectfully, G
Good move reducing your daytraders after all, all you need for daytrading is decent movement and high liquidity right? I think a key part of any platform should be backstop automatic risk management that leaves you out of the equation.. Can't wait to see your ES trading!..
Nodo you will do good,I see a good trader in you in few years.This is just a slight setback in your quest to be a profitable trader.You will learn relearn re-relearn to keep your stops,not to argue with them.