Wednesday’s Stock Trades

Today was pretty good for me. I found 5 different trades I wanted to make. I was alert. I was quick. I traded my plans. Still, something nags me about it. What could it be…. can’t put my finger on it… oh yeah! I lost money again! :-)

Good grief, performance-wise, I think this is my worst week since I’ve been a full-time trader. But before I go give plasma and stock up on ramen noodles, let’s look at today’s trades.

Overview
As I mentioned already, I made 5 trades. I really seem to be getting into stride in terms of finding more trades to make. And, I’m not unhappy with any of them. In fact, the main reason I lost money today was two big market swings, exactly 1 hour apart. They just happened to correspond to two trades I made in the opposite direction.

I decided last night that I would mix my trades up, and do some scalps and some “longer” trades. As has been my experience in the last few months, the scalps worked great. There were two, both profitable. The day trades, on the other hand, were all fairly messy. No wonder everyone in daytrade land is so frustrated! Had I run the daytrades as scalping moves, I would have escaped with tiny losses rather than full 1R losses.

The Trades

Right out of the gate, I was watching the stocks coming off earnings. I wanted to try scalping the morning runs on these guys, rather than just sitting on my hands for the first hour. Since the market opened strong (for the first 10 minutes, before falling apart!), I chose one that was running up. I chose Abbott Laboratories (NYSE: ABT). This was sweet… I got out 1 cent from the top! The execution quality in the morning volatility is kinda scary, though. The chart (click to enlarge):

Next was my first intended daytrade of the day (and the most successful, I’m sorry to say). By 10:30, it was obvious to me that the markets were acting like down markets, even though the dow was “up” big. So, I was looking short. I spotted the beginning of an excellent drop in Take-Two Interactive Software, Inc. (Nasdaq: TTWO), and jumped in. It was trading at 15.51, and I had a target of 15.25, which was support from yesterday’s price action. I entered my short order. I was filled for 100 shares at 15.50, and there were no more upticks for another 15 cents! Eek! And I wasn’t even filled the rest of the way at that point. So, my average basis was 15.34, and I was one unhappy camper! Had I not been filled at all during the drop, I would have cancelled my order. But, it always nags me being in a trade for 100 shares, so I usually just let the rest of it fill and get right back out for a tiny profit. At least that way I know I will clear commissions, in all likelihood.

You may recall in a recent post I said I would reduce my position when I got a bad fill, so that my stop will be reasonable. Well, in this case, the fill was more than halfway to my profit target, so there really wasn’t a position small enough that made any risk/reward sense. So, this trade had to be aborted, and I took my profit at 15.30. ehh…

My next daytrade was CV Therapeutics, Inc. (Nasdaq: CVTX), which looked unstoppable. It had great volume, and was edging up against new highs in a really orderly fashion. I got long on the break to new highs. Then it stalled. Had this been a scalp, I would have just jumped out. Depending on how fast I gave up, it would have been a small profit or a tiny loss. Instead I stuck around to watch it hold up pretty well against the massive market-wide selling that commenced pretty much the moment my order filled. But, it eventually gave way, and fell right through my stop. Fell so fast, in fact that I paid for slippage with a 1.13R loss. Meaning, I couldn’t catch upticks or downticks today! :-)

I knew from AIM that Ugly was long Illumina, Inc. (Nasdaq: ILMN), and it had stalled out. It, however, pretty much completely survived the selling winds that took me out of CVTX. A little bit later, it broke out of its channel, and I thought I’d help Ugly out by buying a couple hundred thousand shares. (ok, maybe a little less). This was just a scalp though, as I was convinced the markets were going down at this point, and did not want to fight the tide. In a couple minutes, ILMN pushed through 43. Unfortunately for Ugly, dumping my hundreds of thousands of shares stalled the stock out again, but it eventually recovered really well. :-)

At this point, my two scalps cancelled out my loss on CVTX. But, I was not done. Seeing as the markets were so negative and all, why not short Maxim Integrated Products Inc. (Nasdaq: MXIM) on new lows? Its pattern looked decent, as it was falling back down from a little bump up from recent lows. I shorted it at the low, which turned out to be the low of the day. :-( I swear, just like CVTX, right after I was filled, the markets turned massively against me. This time, they ran up, with TICK’s blazing into the 1000’s. The problem, of course, is that it’s easy to see I should have aborted the trade in hindsight. At the time, you don’t know if the buying wave is tiny, or something that will last, though. So, I stuck with it, and it touched down near the lows again before taking off through my stop. (Looks like I entered my times a little off on this one, so imagine the entry and exit a little to the left of where they appear on the chart… I didn’t ignore my stop!!)

Conclusion
So, really, the way I look at it, this was a good day turned foul by two big market moves that came at really inconvenient times. I’m not unhappy with any of my trades, and in fact am happy with the way I’m finding more trades to take. Finished the day -1 R, but many worse things have happened to people in history. Even to me, in the past. So, I can’t complain.

Stocks Mentioned In This Article
Stock	Links
ABT	| |
TTWO	| |
CVTX	| |
ILMN	| |
MXIM	| |