Here are my reviews of trades I made way back on March 29th 2006. Compared to the set from the 28th, it seems like I really improved, overnight (but it’s actually just an indication of how inconsistent I was).

Trade 1, RHAT

This one is easily the worst of the batch. Here’s the chart with my original 2006 comments on it:

I think it’s hilarious that I said my exit looks ridiculous. I think my entry point looks pretty darn ridiculous. Well, I’ll at least give myself points for observing the natural round-number resistance at 28. But, look at the whitespace between the stock and the fast ema at the open. That sucker was pretty likely to keep running up. It seems like I was selectively oblivious to the price’s relation to its 8EMA, because the next two trades are based on this relationship.

I think I said it all back in 2006: “I have no idea … how much the stock will move, or in what direction.” Hmmm… then I wish my 2006 self would have gone on to remind me why I took the trade in the first place. Stupid trade.

Trade 2, ENER

I like this trade. There’ve been a couple others like it in this review series already. In fact, I don’t know why I’m not taking trades like this today. They make sense. As you’ll see, though, I seriously jumped the gun on my execution. Here’s the chart with my 2006 comments:

There was ample room for this stock to fall down and consolidate, which is good. 75 cents between my entry, and the 8EMA at the time of entry.

I guess I’ll give myself points for trying at a round number, and maybe in a sub-15 minute chart I’d see that it hesitated prior to my short. But, 30 minutes later than my actual trade would have been a much better entry. A weak 15-minute candle that didn’t make a higher high…

As with all these early trades, I don’t mention where my stop was, but I bet it was either $0.50 or $1.00. I was trading in the Millenium Traders chatroom back then, and they always used $1.00 stops, so I did that sometimes. I would have used $0.50 because that’s about a 1% stop loss in terms of the stock price.

So, good idea, good candidate, very bad execution.

Trade 3, RACK

This is the same theme as the ENER trade, only it’s the move after the retrace to the fast EMA. I like this play.

Once again, though, I completely jumped the gun on my entry. It would appear that I entered simply because the price touched the 8EMA. That’s silly. The following candle showed weakness and would have made a better place to enter.

Trade 4, AKAM

This last trade was definitely influenced by my time in the Millennium Traders chat room. We constantly bought dips in uptrending stocks. If you follow what I write here at the site, and elsewhere, you know I still like this idea… I just don’t know how to safely execute it. Trading breakouts is much more clear-cut.

I give myself credit for keeping the round number 32 in mind, and recognizing a double top as my cue to exit.

I said in my 2006 comments that the 1:00 pullback would have been a good entry. If I had taken that entry today, I’d have been stopped out at 1:30. I clearly used wider stops back then.

When I was whining about dead stock blogs, it got me thinking about my early trades. Some of those trades were really dumb, if I recall correctly! :-) I’m not sure I want people trying to “learn” from those posts, in their current state. So, rather than taking my blog down, I thought it might be fun to review some of my earliest blogged trades over the next few weeks. I’ll forward-link to the new reviews from those ancient blog posts.

So, to start off, here are two trades I made on my first day as a full-time trader, on March 27th, 2006. You can check out the original post if you want to see it. In the end, I would not have taken either of these trades today, but one of the two at least had a sensible idea behind it. I was glad to see that.

Trade 1, MRVL

First, the chart, with my original commentary from 2006 on it:

My thoughts:

• I didn’t appear to be very aware of the bid/ask spread back then. I apparently entered a market order to exit while something like a 13-cent spread was in effect. Although I almost always use market orders now, back then I called my market order “DUMB”
• Volume doesn’t look like it’s anything special that day
• You can see in many of my trades in this era, that I had an irrational obsession with the 8EMA (why 8? I’m pretty sure it was the fast EMA used in examples in one of Toni Turner’s books)
• This is a horrible setup. I get points for playing in the trend direction after a pullback to a fast EMA, but I didn’t wait for any kind of consolidation or volume.
• The post does not say why I was targetting 58.01, and it doesn’t mention a stop loss. Though, I imagine my stop would have been just a bit below the 8EMA.
• I would never target 58.01 under normal circumstances today. If I want out around 58, you can bet I’m planning to pull the trigger at 57.97 to 57.99. If it gets over the round-number hump at 58, you might as well at least try for 58.05.

Trade 2, INFA

The chart, with my 2006 commentary:

My Thoughts:

• This trade, to me, makes more sense than the other one. The idea that a pullback seemed imminent makes sense. Volume was low, and there was some whitespace between the price and the fast EMA.
• Still, it wasn’t that much whitespace. 10 cents, to be exact. But, the HOD had been 15.65 or so, which makes 5 cents risk versus 10 cents expected reward. I was probably salivating over the 2:1 ratio.
• I really hope that when I said “It was trending well with its 8EMA” that I was referring to the prior day’s action. Because, at the time I took this trade, it wasn’t anywhere near the 8EMA, and I’d have no way of knowing if it was trending well with it.
• I give myself points for waiting until it was below the body of the previous candle to enter.
• I was almost certainly not checking the thickness of the bid at my desired exit price, or I might have known to use 15.52 for my limit order. I seem to recall having a lot of trouble with limit orders not being filled, early on.