At this stage in my day trading experience, I find the question of when to sell out of a position pretty complicated - and constantly evolving. For whichever reasons, I have already decided to buy, and for better or for worse, I am invested; now the day's gains and my prevailing mood depend on the whims of other traders. How many times have I sold only to later realize that I sold at the low for day, or at the start of the rally? How many times have I not sold, only to watch the price spiral down out of control while I sit on my thumbs and shut my eyes to all of the bright red on StrategyDesk? I am guessing that both have occurred with equal frequency. There are huge emotional and psychological elements to day trading - and personally I feel like they all come to a head in the sale - an essential pronouncement of judgment on my decision to buy and everything in between. Now it is done - the profit or loss are locked in and realized.
So... how do I sell?
This is about as un-scientific and un-technical as it gets. And which, as I sat down to write this, really, really bugged me.
I shoot for daily targets - from $150 to $200 per trade, gross. I usually buy in units of 500 or 1000 shares, so that means setting the sell anywhere from $0.15 to $0.40 on top of the buy point. All sells are limited, GTC + ext. If I don't sell the first day by close, I bump the price up for extended hours and possible gap open. I don't set stop losses.
Yup... I have tried a bunch of approaches and nothing seems to work very well - except this: shoot for so much a day. When it comes to selling at a loss, I feel like I am pretty mcuh flying by the seat of my pants.
The thing is, I am not at all sure that it is possible to be rigorous in one's approach to selling (and buying for that matter). But I keep collecting data to see if I can't figure something out.
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