Reached a milestone this morning, and not a good one. My first four digit loss since I started. I could not let the $1000 intraday loss stand. I took a break, regrouped, and took a few cautious trades in the afternoon to hopefully gain some confidence back after a tough blow. I also realized I cannot watch more than one full position at a time effectively unless I am using longer time frames. While watching and exiting one position I missed my mental stop in another and chased it for .45, which is much larger than my rules allow. I followed that up with two more losing trades in the same stock and 0/3 in BRCM. I am not sure how I want to handle daily stops. I must do something. I am not sure it is smart to stop at $200-$300 down because I often come back strong after 1 or 2 quick losses on the open. On the other hand, I could have 4 or 5 of those if it saves one -$1000 day. I also went 3/3 from 2:45-3:30. Hmmm. Tuesday: BRCM -398.40 EMLX +89.10 NVDA -151.20 QLGC -556.00 SEBL +176.80 TOTAL: -839.70 before commissions / -1009.75 after. last trade closed at 3:33. Ouch. --Johnny
Tough Day for you today , I have had many of those. The First week of January I tried to short on 1/3 . You remember that was the day the market went up about 200 points . Well I was trying to short INTC with 1000 share trades , got my ass handed to me. That week I lost about $ 1600 and that was my turning point . Now I have been trading for 2 years so I should know danger when I see it . What did I finally learn about trading and myself: 1) I was guessing at what the market would do rather then what the market was clearly doing . 2) I was not using stops correctly 3) Trading with 1000 shares made me nervous 4) When under stress I was like a deer in the headlights , I froze 5) Don't short stocks because you think people will take profits 6) If you are wrong take your loss and walk away , I would take the loss and then try the same damm thing 20 minutes later regardless of what the market was doing , once again it was that " I think it will do this syndrome" After January I basically stopped day trading , I opened an account at IB so I could get lower commission rates for the 300 - 500 share trades I would occasionally do. I also was doing a lot of my trades in the last 1.5 hours of the day and usually was wrong , once again they were very poorly timed shorts. Trading in the morning is the best but if you are on the wrong side of the trade know when to get out and stay out. All my trades over the last year were shorts , so the problem I had there was shorting then having the trade go against me , I did not want to cover because if I did and the stock sold off I would have a had time getting back into the short that was another mistake on my part. Buying and using a stop is easy , you can always buy back a stock , try shorting a stock in a free fall ( unless its the QQQ) I only trade a few stocks and only one at a time , if I am going to short something now I would tend to try the QQQ because you can short that anytime and not worry about the uptick rule. I may get back into full time day trading but I know I am a much better swing trader :-}
I haven't been doing this long enough to feel qualified to give advice, but here is something to think about. You may be trading too many shares. It looks like you are doing 1000 share trades. Maybe you should just do a couple hundred at a time until you have your strategy fine tuned. It looks like you are unsure about some things that are pretty core to your strategy, and maybe you shouldn't muck with the parameters of your system when trading 1k shares. Good luck. And thanks for sharing your trades.
"I could not let the $1000 intraday loss stand. I took a break, regrouped, and took a few cautious trades in the afternoon to hopefully gain some confidence back after a tough blow." 1) Losses happen to the best traders. 2) Taking "cautious trades" will lose you a ton of money because you have no confidence if the position....or yourself. 3) In the 8 or 9 trading days that you have posted, you have broken your primary rule of not trading after 12:00 at least 3 times. Stick to your rules!!!!! Start fresh tomorrow!!!!!
Musicman, A few things sound familiar: 1) I didn't really think I was doing this, but I was reviewing my trades today and this is how they were: 3 shorts/1 long from 9:31 to 9:56 (no positions into consumer confidence) 5 longs/2 shorts from 10:06 to 11:00 3 shorts from 2:45 to 3:33 I was fighting the market all morning. I am more comfortable shorting, and I had a short bias in mind going into this morning. It took a 20 point move in the futures to change my bias, and by then the market was pulling back. I did better in the afternoon, when I was with the market. 6)I have noticed I try to short breakdowns too early, because I am afraid I won't get filled. I will get stopped out a few times but keep trying because I am "just sure it is going to break down." Two or three small stops and even if i do get the breakdown, I end up flat on the trade. I also noticed my losses were mostly in the afternoons (that's why I started this thread in the first place). I think after this week I will start trading in the afternoons again, but much more selectively and look for less on each trade. I also don't think I'll trade the last 30-45 minutes, probably just about 2:00 to 3:15. Thanks for the insight, -Johnny
Part of the reason I decided to post all of this was to be liable to something other than just myself and help me stick to it. Thanks for the reminder. --Johnny
JPB This is the $800+ loss, once a week, that you were talking about at the start of the thread. It's very clear that you have a problem sticking to your rules (me too). You set a rule of a maximum loss of $200 and to not trade in the afternoon. You broke both those rules today. If you had stuck to your rules you would be down $200 for the day and not need 5 day's of profits to make up for it. Print your broker statement and pin it up on your wall. Every time you reach your daily maximum loss, look at it to remind you how much more you may end up losing if you continue trading outside your rules.
JPB I was looking over the trades that you have posted over the last few days and noticed that generally you have some big losing trades ($300 to $400) and most of your winners are less than $200. I don't know what your trading methodology is, but it appears that you need to turn the risk/reward situation around. It seems to me that you are risking too much in exchange for small winners. "Keep your losses small and let your winners run" For your particular trading methodology, you need to figure out your average net gain per trade, your average net loss per trade and the percentage of winning trades. You can then figure out what it takes to be consistently profitable. For example if you are only winning on 50% of your trades, your net gain per trade obviously has to be higher than your net loss per trade.
JPB I went back and looked at all of the trades you posted. 43 total trades, 24 winners 19 losers. Your average winning trade was approximately $125 and your average losing trade was approximately $172. This does not include commissions, so your average net winner is something less and your average net loser is something more. You are winning on 56% of your trades, if you can bring your average net loser down to or slightly below your average net winner you will be on the right track.
Maybe someone has already asked and you've already answered... What are your exact trade setups your using for each position? Are you using particular patterns, Level II, Times & Sales, Futures as an indicator, chat room calls, TRIN...exactly what are you using to decide when to enter and exit those positions? It would be so much easier to understand what your doing with specific entry/exit times for each position. Many can offer helpful tips much better if that's what your looking for. Nihaba Ashi