This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
I tried a few short scalps today in IDCC, and got shaken out both times, for about -1.6R. The first was a -1R loss on a half size position, since I scaled in. The second was a -0.4R loss on a full position, as I added when I thought there was potential for a breakdown. I also tried to go short LSI, but it retraced and I got out to avoid another loss. So all in all, a kinda crappy day.
I decided I was finished for the day. Naturally, I had to check back in the last half hour to see if anything was happening, though. ;) Just then Bluedog on Wallstreak called out IOC as a possible parabolic short candidate. I looked at the chart, and I thought it was still really strong, and was thinking long. I set up an order just in case, and watched the tape. Here’s the critical part that influenced my entry (start at the bottom):
At the bottom of that picture, you see that the bid crossed the ask (I’m not sure if that’s an error or if it really happens, or what the significance of it is–anybody?), and the ask ran up after it, for a 0.20 move in under ten seconds. Both the rising quotes on the bid / ask and the rapid rate at which they were moving conformed my thinking and made me want to buy the momentum. It seems like a lot of data, but look at the timestamps of the action, and try to get a feel for how it streamed out. The highlighted part is when IOC made a new high after a lot of prints at the high, and I sent the market order. Right after that, there was a pop and the trade took off.
Here’s what the chart looked like when I entered:
And the rest of the trade:
I felt like Richard after my entry timing, but less wimpy, since I held out for more than 0.10 ;) I took a partial when price started chopping around under the high, and held the rest to see if I could get more. In the end, I sold the rest since the spread was so wide and a quick drop could take it back below my entry. Thanks to Bluedog, I had a good end to the day. I decided to press a bit, and I traded large enough size for the trade to put me up almost 3% on my equity. Right now I’m sitting at +17.5R, +20.6% overall on my Prop Trading since starting on 7/25 of this year. Not bad for a few week’s work, eh? Too bad my equity is only 1/20 of my buying power, but if I can consistently keep these results up for the rest of the year, I’ll move over some more “non-risk” capital from safer places so that I can compound it. Then when I have enough to cover living expenses, I’ll make the move to full time. That’s the plan, anyway.
Trade Summary:
IOC Long
Entry: $40.82, Stop: $40.62, Target: $Scalp
Partial: $41.50, Exit: $41.11, P/L: 2.26R
Trade Grade:
This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com
