Going to chronicle my trades during the summer as well as lessons I learn... I already keep a journal on my own, but am interested in seeing what kind of feedback i can get here... Brief history... just turned 19 yrs old, started trading pretty much day i turned 18. Account bottomed out a few months ago and has been looking like a heart monitor since, trending slightly higher with the occasional dip because of breaking my own rules. I try to trade very simply. Use limit orders and usually buy pullbacks and sell bounces using 20, 50, and 100 DMAs and very rarely will add size if other indicators (MACD, stoch) support trade. Do very basic volume analysis to guage moves. Anyways, I am very modest when I make gains and very hard on myself when I lose. I really am ready to start making some money though and summer will be the time to see if all my market tuition pays... Been trying a few countertrend trades lately... Went short on NGA today 11.80 and covered 11.73 on 60 minute chart. Finals week and have one more so didn't want to be holding a 1-3 day position that i need to keep moving stop on... plus stock didn't break as fast as I wanted. Shorting VMSI tomorrow at stop 50.89... 60 minute chart formed double top with lower second top. Pretty far ways away from the 20 DMA. That will be my goal, but I will use a tight trailing stop as markets are trending higher every day and don't want to be caught. Might swing HAR long tomorrow... but volitility in general a little low.
3 - 5 grand a trade depending on if I am using margin or not. Not very much money. I withdrew some a few months ago (and I lose a few grand in the first 2-3 months of trading where I really got told that this trading biz ain't easy). Depositing 3 grand back into my account this summer and possibly more depending on how well I do. Also, I am switching brokerages because of comission costs. Scottrade at 7 dollars a trade means I cant ever go for just a few bucks on a trade even if its a sure thing. Getting on IB... as I only trade higher priced stocks for the most part. Also, as a clarification, I am making my trade w/ VMSI off of the daily chart, but confirming it on the 60 minute chart and will use a stop slightly above the bottom of the double top formation. This provides a very nice R:W, considering the trade goes through.
Would have liked a stronger close today... but nothing is violated. Now it's waitand see time on monday. Wish I had time to do some intraday trades today. Lot of stocks moving with some very tight patterns...
VMSI sitting on trend line. Far aways from 20 DMA, but still could continue given it's strength and good volume. Tomorrow I'm going to look to get out at around 50.35 unless chart shows that it will be breaking down below this level in which case I will use a trailing stop and see how far it goes tomorrow. In hindsight... should not have taken trade based on daily chart. I did not have anything verifying the idea that the stock might revert to its mean... therefore trade was flawed. For the next time I'm going to try a counter-trend swing play I will have to base it on smaller time frames. My entrance should have been on 30, or 60 minute charts with my capital at the break of 51.07. Will see how tomorrow plays out. Might look to short MA under 132.04. This chart's characteristics look like a better short to me. Far from 20 DMA, seems like could pullback to test gap even despite volume. I would definetely be looking to buy MA on a pullback as well. Biggest thing on my list is TSL... volume characteristics are really strange for a stock that is moving up so quickly - doesn't make sense to me. Lot's of volitility. Formed a double top with a lower second top. If price goes down tomorrow, we have a down trend and a channel line (possible profit target) in place. If going short, I will cover half my position around 50... where we have some horizontal price support and the 50 DMA and let the rest run with a trailing stop. Entrance will be at at break of 53.92. Another possible entrance on 30 minute chart under 56.41. In this scenario I would cover around 54 and possibly reshort if my longer-term trade signal is given. The only reason I am mentioning the second entry is because of the intraday volitility on the stock. I usually would not play such a short time span with my capital. As a reminder to self... I need to get TC2000 tomorrow and give it an honest effort this time and see what I can do with it. My current method of getting charts is very slow... I just need some scans so I can look for basic patterns I like.
Protective stop of VMSI at 51.35 got triggered. Got out of the trade and went long. Very illiquid move... will see what happens from here but if market mania is here to stay i feel more comfortable being long than short. Market keeps going up tho... almost made up my loss by switching directions already. Should have gotten out even sooner w/out use of protective stop given that I admitted it was a faulty trade. But, that is in hindsight once again.
For the summer... I will be buying positions only with good fundamental characteristics/chart behavior. Did a scan of the markets today using TC2000 for some O'Niel-esque criteria. Have a decent "trading list" which I will attempt to stick to, gradually adding more and removing some. Some of the stocks have too low volume and I will probably toss them away. JAX, TO, and SPAN are examples of this. Most of these I plan to play as pullbacks. Will be trading these on a fake account and keeping track of paperprofits and losses as well as on my real account (to a smaller extent). Will post entries/thoughts later tonight. SPAN SSYS GMRK JAX TO CV SNHY DECK PPD CRDN AXE CEDC DDMX BEN BRLI
One other comment... and I'd like someone to help me out if you agree. With 3000 dollars currently in my account... though I am using the capital solely to learn... it does not make sense to have a timeline of 3-5 days or perhaps even 1-3 weeks. Maybe the next time I catch a pullback I should fudge the numbers a little... use a slightly larger stop loss (5-8%) perhaps, and hold for 1-3 months and revise my strategy as I add more capital into my account as I feel more confident in shorter term trading. While I am learning by playing around with my 3 k... there is no sense in losing it with commisions making it very difficult to break too much above even. Just some thoughts... once again things may change after I switch to IB, but for now, I do think that I need to keep my mind focused on staying in the market longer rather than catching 1 swing and getting out.