I made four trades today. You’ll probably want to check the url and make sure you are actually at Move the Markets. It’s okay, I’ll wait…
Yep, it’s really me. I’m really wanting to follow through on making more trades per week, as long as they are good. But, that’s not all! Over the weekend I decided these 0.3R wins are for the birds. Many of my trades over the last few weeks went at least twice that far without me. I have a statistical obligation to hold on longer! So how did that go?
Not just real well today, but it’s entirely my fault. The biggest problem was, I started the day off with two complete losers. You know, the kind where you can imagine the MM’s laughing at you for buying at the exact top, while they push the price down below your obvious stop? And, to make it worse, both losses were on the same stock, Akamai Technologies Inc (Nasdaq: AKAM). After the first trade (click to enlarge)…
…I felt like I was robbed… it took out my stop by just a few cents, at a time when the markets were negative TICK-wise. I thought it just got caught up in the overall market emotion. As if to confirm this, it recovered in a pretty orderly fashion. So, when it made new highs again, I didn’t have to think too hard about buying in again:
… but if the first trade was a robbery, then this was cold-blooded murder. It pretty much dropped from the moment my order was filled, 1 cent from the top of that move. I am pretty happy with my stop, as the price did bounce off it a bit before falling through. I felt like it at least gave me a shot at recovery.
You can imagine, this is not the way I would have preferred my morning to go. Especially since the first AKAM trade would have yielded my typical 0.3R profit, had I stuck to my old strategy. But, that’s the way it goes, and we just pick up and move on.
Moving on… I spotted Cameron International Corporation (NYSE: CAM) setting up pretty well on consolidation after a vertical spike. I wanted to be filled at 50.55, but got filled at 50.60 instead. What a great start. Ofter reaching 0.5R, I really wanted to get out, since I was still a little thrown off by the two losses this morning. But, I knew that wasn’t the way to ultimate victory, so I held on. Then it dropped to my entry price, and I didn’t have the guts to hold on to it. I got out for a 1 cent gain. I would call that a mistake, since my previous trades shouldn’t really have anything to do with this one. Had I held on, I would have had a 1+ R gain.
Last trade of the day was on McDermott International (NYSE: MDR). Again, I was gun shy. I was a few cents shy of the 1 R profit point, when it dropped and gave up half those gains. It would have been more proper to stay in, or at least wait for breakeven like I did with CAM. Instead, I was a wimp and took 0.5 R. If you glance at the chart, you’ll see that staying in would have made me at least 1.75 R.
So, I let my horrible morning affect my trade management in the afternoon, which is always a bad thing. Not the worst mistake you can make, for sure. But, instead of ending up slightly positive for the day (as I would have, had I held on for higher profits), I ended up down 1.5R. StockTickr has reports that tell me Mondays are my worst day. I should never change up my strategies on Mondays, probably!
It will be an interesting week, to see if I scurry back to my scalping ways, or if I can tough this out a little.
Ricard,
You ARE human! For the longest while there I thought you were Superman! :-)
Seriously though, knowing you, you’ll bounce back tomorrow.
Best of luck in your trading tomorrow!
Yep, just human! Glad you did well this morning.
Richard…thanks for the list of potential stocks day trade stocks…I have a question for you, this is one that I struggle with all the time…it’s annoying since I struggle with it on every trade…how do you manage a wining position…specifically how do you decide when to move your stops, especially on those stocks that move but don’t hit your fib extensions and look like they may be headed back to your entry point or over…sometimes I want to cut the trade short if I hit 1/2 R and the stocks starts retracing…having only traded for about 3 weeks…I am looking away from my P&L and focusing on setups and trade management…but I hate loosing money on stocks that become profitable shortly after entry…
@LP: well, it’s a judgement call, and I’m always tweaking the way I approach it. For the last few weeks (the 100% win rate weeks) I just took the first swing in my direction, no matter how small. So, I wasn’t chopped up with everyone else, but I didn’t make a fortune either.
This week, I’m trying for at least a little more gains. As I write this, I’m staring at an open trade where I’ve had 0.5R on 2 occassions so far, and I’ve stayed in.
I can’t give you guidelines for your trades. I just watch mine and keep track of whether I would have been better off to stay in longer, or not. Until you know, why not err on the side of caution? You’ll be mentally happier with your account going up, while you are figuring things out.
I feel you that…I just wanted to get a better sense of it…some want to hang on the call is invalidated other like yourself don’t want to be in the red. I waited for an invalidation today on the 15min LRCX…it wouldn’t drop below 49.99 and angel told me to cut it and the devil on the other shoulder told me to be greedy…