Thursday, February 01, 2007
A humbling experience
I was very impatient in the morning. I was telling myself to be selective but I was doing the opposite. After my loss in SNA, I just lost my focus. I was thinking about making my money back. I took a couple more hits after that and I was down $360. Later on in the day I caught ASN, but since I had a fearful mindset I took profits early. I brought my loss down to around $160. When I saw it continue to go up I went back to scalping because I was desperate to recover. I found that my efforts were futile as I racked up $40 worth of small losses and commissions.
I got a lot to learn. I was lucky last week because I caught the right stocks. These past two days the market behaved differently and I have been losing money because I was trying to trade the way I did last week. To make matters worse also I increased my size. Better moves came in the afternoon, but I had no confidence to trade them. I am going to cut my size down to 100-200 share positions and be very selective on my trades. I am going to stay small until I experience all types of conditions and be truly confident in following my plan.
I lost $200 today.
- I have been trading for 5 years. It took close to a year before I became profitable. I find that I am improving gradually each year. My method of choice is scalping. My edge lies in tape reading NYSE stocks and staying on the side of the specialist. That is the method I learned when I started. As I build up my capital I will try new styles and trade new markets. In late 2006 my trading hit a rough patch after the introduction of the NYSE Hybrid system. For most of 2007, I have been on a search for new strategies that would help me adapt to the market.