Trading - the game of inches

Friday Trade Review or letting greed and fear mess with your mind 5/01/2009

Action of the day:

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SWKS - missed on 8 am opening to get filled - pissed.

YM - falling in late morning - pissed not being in.

YM - after open - get in but do not trade as planned because of lost profits on first two missed trades.

MEE- missed big profit trying to protect small profit because of last YM trade.

CNX - trying to be greedy but missed bigger profit allowing fear to scare me out of the trade.

POT- bought nice BO but just got out- hate trading POT.

SLB - bought break out but had to sell too soon because of running out of trading time.

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Details on the charts.

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Why did I write this up this way? To prove a point to myself that if I traded the plan for each of these trades, it would have been a great day for myself instead being okay. To again show to myself, I do two things two often and nearly every day. I allow other trades to effect my current trade and I trade way too much on emotion than a straight forward plan.

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The numbers:

Stocks: gross +236 net +216 shares 4000

Stock Futures: gross +60 net +50 contracts 4

Forex: none

Wednesday Trade Review 4/22/2009

Yesterday it was BK, today it was CAT. The CAT trade came so close and I freaked at the last second on it. It could have been a big home run. I am trying something different. If I see a trade and I do not have enough time to do my limit order, my default order is now a market order. Plus I am not going to screw around with share size. My orders will be in pieces of 500 a pop which is my default size.

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I have missed too many things by being too cute about where I place my order and for how many shares. It was nerve racking today but in a weird way I had more fun trading than in a long time. I am beginning to give my trades more time to work (5 to 10 minutes instead of 5 to 10 seconds - lol) I believe I need to be more patient or force myself to re-enter a trade if after I get out, it acts like I had expected it to.

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Hopefully, jumping off a tall building has somehow messed with my brain in a positive way and I can regain my trading sprite of many years ago before I allowed life to beat me up and I became a trading wimp.

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The numbers:

Stocks: gross +134 net +99 shares 7000

Stock Futures: none

Forex: none

New poll

Look to the right. If you do not like the answers - you can leave one in the comments section.

How to keep your broker happy 4/25/2008

The first trade was not bad and the third was an idiot trade but there was a ton of stocks with false break outs today and I did not take in account for that but I kept my broker happy.

Getting Ready to Buy 3/12/2008

The Bull/Bear numbers came out and the first time in a long time there are more Bears than Bulls. This seldom happens. Sentiment numbers are apart of the numbers used to come up with the Smart/Dumb indicators from at Sentimentrader.com - a great tool to figure out what is going on in the markets. Their Smart money indicator is mildly bullish but their dumb money indicator is insanely bullish. The difference of the two was only been greater twice in the last 10 plus years. I have been waiting for this for a long time. This may not be the perfect bottom but 3 months from now - we should be higher and a good case that in 12 months from now we will be higher. The only thing that could stop this is a major event like WWIII or a nuclear bomb being dropped on NYC.

When should one trade? 3/5/2008

I am at a lost with this. I have talked it over with many friends and bloggers. For some reason, I have been sick a lot since Thanksgiving. I thought being away from people (I trade in my basement), I would not get as sick as often. It seems to have worked the other way around. I recently went through all my trading days and found I make money about 60% of the days I feel physical well and only about 30% of the days I feel physical sick. It would seem like it would best to take those days off but at times that would kill 2 weeks at a pop. I do not know.
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A second thing is I had to adjust one of my medications back in early January. The doctor decided instead to change which one I was taking. There would be a few side effects. Seven weeks later I am just starting to feel normal. My blood pressure went too high along with my heart beat. My sleep became crazy and my moods where all over the place. Just when my blood pressure became normal, it decided to drop suddenly and was too low for little more than a week. If I told off the majority of days I did not feel normal, I would have taken off 5 out of the last 7 weeks. Add in being sick - maybe I should have not traded for the last 7 weeks.
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A third thing is I find even before the above two items, my moods can be all over the board for many reasons. If I had a trade day that was very frustrating, I may be stupid allow myself be affected by it the next day. I know totally that this is stupid and will not lead to success. Sometimes I have a bad day and then the next day I get out of my mood quickly. I even have the problem sometimes if I have a really good day, then I get too crazy the next day.
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Bottom line is - I write this blog mainly for myself. I know I need to get more control over my emotions. I am never stating I am blaming my trading results on my mental or physical wellness. I just write down what I feel and think and how I feel sometimes - period.
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Comments anyone?

The most important market lesson - Go long Monkeys

Once upon a time in a village, a man appeared and announced to the villagers that he would buy monkeys for $10 each. The villagers seeing that there were many monkeys around, went out to the forest, and started catching them. The man bought thousands at $10 and as supply started to diminish, the villagers stopped their effort.

He further announced that he would now buy at $20. This renewed the efforts of the villagers and they started catching monkeys again. Soon the supply diminished even further and people started going back to their farms.

The offer increased to $25 each and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it! The man now announced that he would buy monkeys at $50 ! However, since he had to go to the city on some business, his assistant would now buy on behalf of him.

In the absence of the man, the assistant told the villagers. "Look at all these monkeys in the big cage that the man has collected. I will sell them to you at $35 and when the man returns from the city, you can sell them to him for $50 each."

The villagers rounded up with all their savings and bought all the monkeys. Then they never saw the man nor his assistant, only monkeys everywhere! Now you have a better understanding of how the stock market works.

Thursday Trade Review 1213/2007

Sucks - it is bad to start out the day fat fingering something. I never really aloud myself to mentally recover. I did do a lot of trades trying to dig myself out but I could not handle any pain on any trade.
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I should have looked long in the stock market. Once past noon, the trin start improving for the rest of the day and issues did well after 2 pm.
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I did screw up with the rollover. I traded Dec contracts when I should have been trading March. By the end of day, March was more active.
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Although, I did a stupid mistake this morning, I feel better about things seeing I actively traded more but again I did not follow my rules - do not properly hit the Big Mouth stock.
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The Big Mouth stock dod not move much but short it with 1000 or 2000 shares and make a couple of hundred bucks then once it seem to find its low, go long. The market was in fine share and you could pick up a couple hundred more.
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The numbers:
Stocks: gross -393 net -408 shares 3000
Stock Futures: gross +15 net 0 contracts 6
Other Futures: none
Forex: none

Should I really be doing this???

Today I felt like the market was handing me fistfuls of money and I kept saying no thanks. I have so many great setups and a lot of them would work out just fine. I place orders and then pull them. I place orders, get filled, then take a two second profit. I place orders, get filled, place stop, feel a baby amount of heat, and get out. And a lot of question of what I saw.
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I have a couple of setups. See the setup and not place the order. Then I would rush to place a non-system order and screw it up.
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I have a couple of very successful traders from time to time giving me great ideas. It seems like 80-90 percent of them work. Do I take any of them, seldom and the ones I take I seem to mess up out of fear or greed.
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Why am I so afraid of losing?? I know if I got a couple of good days under my belt - I think I would loosen up. This is a dream of a lifetime for me and I can't get myself to take a decent swing at it.
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I should be making good money but I lack confidence. One trader said once I got that confidence, I will trade like a rabid dog.
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Today, I missed the Big Mouth stocks. MT gave me a great trade to short FSLR. I took it and screwed it up with a trailing stop too clse. I felt like the market was going to fail and was looking to short any rallies. I thought I had a great trade in APD only to find I did not push the entry bottom after my bathroom stop (see charts below). I called a couple of tops to other traders without taking them myself.
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Today I feel with out too much effort, the way I looked at things, I should have made $3000 to $5000 today. I banner day. Instead, I have my head up my ass and lost $110.
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I you live somewhere in Central New Jersey, and you want to yell at me during the market day, please come by. I need someone I think to be next to me. I would state my case for a trade including the stop loss and profit target and reasons for moving the stop or getting out of the trade. You would say place the trade including the stop. And then if I come near touching the key for any reason other than the ones I spoke of - you break my fingers with a hammer. This is the only way it seems I would be successful.
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This is bad really bad. When the bell rang at the end of today - I just broke down and cried. The only saving grace I take out of this - with all my mistakes today - I only lost $110. This gives me the means to totally frustrate myself again tomorrow.

Big Mouth Trade Review 11/10/2007

The Big Mouth recommended 5 stocks Thursday night. Base on how the futures were trading, I think I need to rethink how I try to play them. Once we got into October, shorting these stocks, done correctly, could make a good deal of money.

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I have been burned once in a while on doing this so I have become overly cautious selling. As a result, I make no money from them. With all of them on Friday morning being big cap stocks and the futures being down so badly, I should have just hit them with market orders on the open to go short. Even if I put on short positions, like 200 shares, a decent amount could have been made.

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I have been questioned by other bloggers that I seem to try to do too many things and I am not being successful at any of them. I am thinking to stick with only shorting Big Mouth stocks and day trading the YM futures until I start making money. The idea of shorting Big Mouth stocks was what brought me to day trading in the first place.

KISS 10/28/2007

KISS - Keep It Simple Stupid or the first band I ever saw. As I stated before on this Blog, I have been looking at the currency market trying to figure out a good way to swing trade them. Someone mentioned why not try the 9/14 EMA cross over? So I put the moving averages on the EUR/USD and it looks very good. The person stated "just do not automatically buy and sell when the averages cross but when they look like they are, use your brain". In other words, read the chart at the time.
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The chart goes back a year on a daily basis. If you started out that year long, then the first crossover looks to be about Christmas of last year. At that point, I would see there is a triangle pattern. I would give that pattern the benefit of the doubt. The trade would be to sell the long and go short about 1.3100 level.
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The next trade would be the rounding bottom in January and February where you would get long again in the 1.3000 area.
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The averages do not roll over until just above the 1.3500 area in mid May - nice gain of over 500 pips.
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You nearly get a signal the first week of June but should cover at the end of June around 1.3400.
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The next set of signals would have gotten you out around 1.3650 then short then long then short again for a couple of losses in July/August before finally getting you long at 1.3650 in mid-September.
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You would still be long today and a head by maybe 2000 pips or $20,000 per regular size contract. At a couple of times, you may have a $2000 loss or watch $3000 in profits disappear and you need to figure out a Black Swan Stop Lossbut could it really be this simple (talking to myself) stupid?

Friday Morning Thoughts 10/26/2007

I just want to scream. I am so sick of this. One of my biggest problems is being able to think with the market. To have the right charts in front of me when the opportunity presents itself. I had the YM futures opened in front of me. I had looked at them and noted where the overnight lows are. One of the trades I like taking is if the futures have been in a tight flat range all night and there is no news out there, just buy the futures near the low in the time frame of 7 AM to 8AM EST. As I was looking at the YM and bringing up my TradeStation thinking I should get my order in because the setup was there, CFC earnings come out and the YM futures just soar. This would have been such a nice start to the day. The idea of the trade is to take 20 to 40 points and a risk of 10 or 15 points. Bingo - the trade would have worked perfectly.

Let's think this out 10/24/2007

It is time to learn from the damn mistake.
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One - I have been trading lower price Big Mouth stocks using increments of 10 to 25 cents. SGR is high enough priced where I should have been using maybe 50 instead to leg in.
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Two - once the stop had been blown, take a moment to look at what is going on and don't panic. Panic never makes you money.
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Three - it is only $1500 loss. Not the end of the world. Pull the head out and get back into the game.
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Four - Look for the positives in the trade. I started following the plan but lost it when the heat was too hot. The bottom line is - I was right on the trade. The execution was not good.
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Five - One bad trade does not have anything to do with any other trade.
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Six - go have lunch and fricking calm down. A transmission job on your last car cost you over 3 times as much.
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Seven - remember you know how to make money. It is learning how to control your emotions. A high percentage of your trades would work out if you let them.

Double Crap 10/24/2007

I know once you are out of a trade not to look back but SGR is now falling like a rock. If I held thru the great pain, this would have been my best trade of the year in stocks.

Monday Morning Thoughts 9/17/2007

This market is very frustrating or maybe we are just at one of those points. There are so many ways of looking at this market right now. We are at the top of the 2 plus trading range. We went from the bottom to the top of that range way too fast. It should have failed. Now we are kind of hanging out at the top. The longer we are here the greater the chance we will break out of the top of the range and retest the previous high.
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We are waiting for the Fed right now. It seems like every thing they could or could not do, will let the market down. A classic buy the rumor, sell the fact type of market.
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What happens if we combine the two, the Fed move causes the market to break out of it ranges for a day then fails - do we hit the bottom of the range or retest the low?
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When the market falls into this type of scenario, a trader must be very flexible. They can not put too many lines in the sand or stick to one idea. Markets that are just trending up or down, you can sell or buy the rallies and then sell or buy the declines - a lot fewer questions.
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This lesson I learned too many times the hard way and I am still learning. Keep an open mind.

A Review of a MT trade 9/12/2007

One of Missed Trades trades stuck in my head today for the reason a couple of other traders were going long it as Missed Trades was shorting it. The chart above in the daily of FSLR. It got an upgrade today and was higher in premarket. The problem was it did not look like it was going to get a large pop. It first needed to clear yesterdays high and then it had a brick wall of 3 day highs around 109. Many times MT legs into trades which works great for him.

Once the open pop was done, the retest of the daily high looked like to place to begin to leg into the trade. The first legs were 106.50 and 108.00. I believe there may had been one more. Both were filled quickly but very soon the market was not racing forward and FSLR lost it steam from the upgrade. MT cover 1/2 around 106.40 and the rest at 106.05 but he stated if the stock spent anytime under 105.00, it could really break. Boy did it.
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This trade shows two things I believe - you need to look at the daily chart to see where a day trade should be made and once you are done with a trade, you are done with a trade. You can't cry over money left on the table. You just go onto the next opportunity.
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Hopefully me typing makes sense for I am really tired right now but I want to say - everyone should come and join us at MT's chat room. A week trial is only $25. And as the little thing on the right of this site states, they allow me to cut you a deal on the service.
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You can join and just follow MT trades but the real beauty of the site is he helps you think for yourself to become a better trader. That is why I am a member.

Monday Trade Review 8/27/2007

The trading Gods blessed me with a gift today. One of the ways I try to make money is, if the bid/ask is crazy on a stock, try picking some up or shorting it. An example is SAI today. I have traded this stock and I know unless some crazy news is out there, it does not open a big amount down or up. The bid/ask was 16.90/17.94. It had closed at 17.82. No news so I bid at 17.15 and got 200 shares. I tried to sell at 17.77 on open but did not get filled so I dumped them. A nice simple trade. 99% of the time, the specialist or market maker gets these. Once in a great while I am lucky. One word of caution, you must understand how the stock trades.

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Other than that, I did little today. Market was very slow and hard to game. I had my doctors appointment and hang some shades to make the wife happy. That killed most my day.

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The numbers:

Stocks: gross +90 net +86 shared traded 800

Stock futures: gross +15 net +10 contracts traded 2

Forex: none

Barrons VS The Big Mouth 8/18/2007

I figured sooner or later Barrons would pick on him. It is frustrating recently that a lot of his picks have not had the same pop in post/pre-market as they once did. I am hoping he and his picks become lively again in September. The summer is not a good time to pick on his picks.
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I have written down all his major picks over the last year and a half. The results I believe I could get if I shorted them based on my own rules are as follows:

January 2006 +4,000
February 2006 + 17,650
March 2006 + 16,000
April 2006 +11,000
May 2006 +7750
June 2006 +7000
July 2006 +1750
August 2006 +4750
September 2006 +5750
October 2006 +1000
November 2006 +5000
December 2006 +3750
January 2007 +5000
February 2007 +7000
March 2007 +7250
April 2007 +6250
May 2007 +7250
June 2007 +4750
July 2007 +2000
August 2007 +750 so far.
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Some of the rules I use is he has to move it in the post-market during the show. I do not use any of the call in picks. Only his main ones hi-lighted. The stock must have shares to short. The trades are based on 1000 shares per trade or 5000 shares for stocks under $10. I figure this on the meat part of the move not the top and bottom ticks. I figure on a lot of the stocks I can do much better than what I write in my journal or the totals you see above. This is mainly because I may trade more than 1000 shares or pull off taking more than what I conservatively guess. I have traded a lot of these at times - changing my rules to better fit the situation and my own mental game. Also if it is a day in an up market, his picks make good buys and the first reaction to his picking it.
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But you can see from above why I am so interested in them. The Big Mouths contract I believe is up at the end of October and CNN and Fox are going to try to get him. This will give him a new format and I hope - more stocks to play with. We shall see.

Stress 8/13/2007

I find it amazing when I tell someone that I day trade stocks. They nearly every time say "that is too stressful". I ask them if their job is stressful and they say yes. That stress to me is harder to take.
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Jobs that I have had in the past, I have worked 80, 90, 100 hour weeks. I have on a couple of occasions worked 3 days in a row with out sleep. I have flown to a foreign country overnight and give a presentation with out sleep. I have given presentations in a country at war. I have worked on client sites where VPs have been telling how stupid I am. I have worked on Xmas, Thanksgiving, and all the other holidays.
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I have worked so much and eaten so much take out food, the food firms would send me the latest menus. I worked once on Xmas when my daughter was visiting and at the age of 20 she came down to my basement office at 9:30 PM and ask "When are we going to open our F-ing presents".
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I have lived where the first thing I did each day was read email and the last thing I did was read email. I have lived with beepers that would go off at all times of the day. Once I dropped my beeper in the toilet and I dug it out like a Coke addict that just dropped his stash.
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I have been on vacation far away in the desert, 60 miles outside of Las Vegas. We had not seen a human being in 30 minutes. No buildings anywhere - no sign of human life except for the paved road we are on. Guess what- my cell phone rings and it scares the shit out of me. It is work. They can't find some important file and they ask me hoping I know where it is.
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This is stress. Stress that never seems to stop. You never get off the cycle until the next vacation but then you spend the entire vacation taking to unwind.
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Day trading - at times incredible stressful. At times, nearly peaceful. The difference is that at the end of day, all my money is in cash. The day is over and the stress is gone for me on most days. In fact, as crazy as this sounds, I think I will have problems dealing with the lack of stress.
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The numbers:
Stocks: Gross +27 Net +24 shares traded 600
Stock Futures: none
Forex: none