Tuesday, January 15, 2008

Daily Summary - The Blow Up

12752 shares
-970

My winning streak ends with a bang. Yesterday I kept trying to short on an uptrend and today I tried to go long in a downtrend. I lost over 650 trying to play bounces and the rest on my ill timed short entries. My losses really snow balled because I put on some desperate gambling plays with 300-500 shares. I thought I can catch some 30-50 cent bounces on the fertilizer stocks but I never did. I kept saying they are weak because I lost money playing every bounce yet I do it again awhile later. Things got really bad when I bought 500 shares of MOS and my internet went down. I turned on my backup connection and I was down over $300. MOS bounced a bit and I got out with $180 loss. I was planning on buying TRA, but I was on the wrong order entry window and I bought MOS instead. After my MOS trade I put on another 500 share in AGU and lost $100. I am shutting down early. If I continue to trade I will probably put on more hail mary gambles.

Lesson: Do not try to play bounces on big down days. If I plan to go long I need to wait for the market breakout a base or reversal pattern.

5 comments:

Reese said...

This was one of those days where one was inclined to think "it can't get any worse, here comes the turn around", and all the while it just kept getting worse.

Dinosaur Trader said...

OBAT,

Clearly, Denarii stole your profits.

-DT

JMJAtlanta said...

Consider installing circuit breakers, if you haven't already.

"If I'm down by $X or have lost y trades in a row, I stop trading for the day. If I stop two days in a row, I'm done for the week. If I lose Z% in a month, I'm done for the month. I will continue to take my normal trades, but only on paper."

OBAT said...

Circuit breakers did not work today. I thought I had a $stop loss of $500 for a day but I forgot all about it.

LP said...

OBAT,

One day you will join me in robot land. Trust you me.

LP

About Me

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.