Saturday, March 31, 2007

My trading Style

I mainly trade currencies and stocks. I hope to one day add some futures too.

In currencies, I look for the following -

  1. To fade big moves to economic reports. Wait for the first reaction minutes after the report. Watch the first pullback and then trade against the retest of the reaction high using a place somewhere past the reaction point as a stop. Reverse the trade if the stop is hit and it makes sense.
  2. If the currency is in a range and breaks out, then goes back into the range, then looks to do it again, buy the move back into the range and many times it will go thru the range out the other side.
  3. Play trendlines, chart formations, fib numbers.

In stocks, I look for the following -

  1. To go long BioTech positive trial news(negative is too hard so far).
  2. Go long or short good or bad earnings news or up/downgrades once a bottom or top looks to be in.
  3. Fade the big month on TV when he moves a stock too far.
  4. Trade breakouts of stocks making a new high from a flat top.
  5. Go with trades from some popular Blog sites knowing the author will juice the stock or again if it reactions too much - fade the recommendation.

In any of the above cases, I make a list and a plan for each of the above cases. The only trades I make on the fly are from the Chat room or if I see an industry moving, I try to fine a good stock chart that goes with it.

Friday, March 30, 2007

Friday's Mess DNDN 3/30/2007

This the type of trade that really hurts. I was expecting DNDN to go nuts and it did. I got up early, ran down stairs and fired up the system to quickly see DNDN started trading at 7:00. Saw a couple of ASKs at 12 and 13 but had no guts to jump on them. Watching tick by tick the first trade should have been long at 16 with a sell around 18.75 (9:00). It looked like a head and shoulders formation top. My head was not screwed on right. My brain being stuck with an upward bias - I wanted to go long. I figured the opening should be crazy so I placed an order at 17.25 well below the current market. To my surprise got filled in seconds, started watching the bouncing and forgot to placed a stop loss thinking I saw a bad tick. When I realized my mistake, I hit a BID and got out down $1250. My stop would have been at $500. Dumb, very dumb and I let it destroy my ability to think for the rest of the day.

Missed Trades - USD/JPY, GOL, COGN

It is interesting that other than having my worst trade in 6 months (see above). I managed to miss 3 other trades. Each of them being a different method that I like to use.

The first type is a currency trade either on Econ news or chart formation. The USD/JPY had been hitting a wall each time it got to 118.40 area for a couple of weeks. The personal income numbers got it to pop out of its morning range and hit the 118.40 like a brick wall. I had orders to sell multiple times but pulled them each time before they got filled.

The second type is going against a big mouth on TV's recommendation. GOL was surging in pre-market and I was expecting the 31.75 area to be fruitful for a short after the opening. I had the order in but pulled it putting all my eyes on DNDN.

The third type was buying or selling good or bad news. I like buying fear and selling greed. I was watching COGN - placing and/or chasing it up in the morning and never getting in.

What another Day Trading Blog!!!!

Yes another day trading blog to go with the other million out there. Why - I am very frustrated at the moment with my trading and think if I take the time to post what I do maybe I will get better. I want to be successful enough at this where I can leave my current day job. Maybe I will learn something by doing it and who ever reads it may too.