End of Day Journal (11-1-2010)

Summary:

Paper traded 200 share lots today:

Three-day weekend... at least 3 days away from trading.

Friday was a productive dissertation day, but given Saturday and then all day Sunday to wonder 'What if?', I was able to wrestle up a lot of fear and trepidation. What if last week was a fluke? What if I never get this? Etc., etc. Crazy stuff huh?

Well, the morning went pretty well profit-wise, but I could tell that I was not in the 'zone' that I was in last week. I felt in tune on the NFLX, BIDU, and POT trades (maybe because these were moving relatively fast?), but out of sync on the others. I debated quitting for the day, but I thought it would probably be best to get as much time as possible if I want to go live eventually. I took some time out and tried to re-focus before the afternoon session.

Things went so-so. I felt beat-up by mid-afternoon. Definitely not in the place I was last week. I couldn't adopt that 'other end of the trade' perspective that I have come to realize is so important. Should I of stopped trading? I am thinking that part of being successful in this business is knowing when to stop. Do I give this up in order to put in more screen time while in training?

I don't know. There is always money to be made on the markets - always. This afternoon it just happened to be on the other side of most of my trades. I think I need to learn to adapt to every market scenario.

But - the primary piece of equipment in my trading business is me, and if I am not feeling up to the task, I probably need to stop. Feel free to offer some opinions on this.

This afternoon was marked by some interesting positions - positions that I have taken numerous times in the past: trading what I saw as breakouts/breakdowns but ended up only being ranges. Part of this is automatic for me - I see it and I think I need to trade it, even against my better judgment sometimes. I would like to take a closer look at the CTSH and POT entries.

Here is the 15 on CTSH (afternoon):

Here is the 45 range - and what prompted the initial afternoon short:

When I entered the afternoon short I was seeing higher volume on the 45 with a red candle and nice topside wick; ideally my preference would of been to see either a big volume on the 15 doji, or very small volume (buyers are exhausted), but nonetheless, the entry was the thing to do (maybe a little early). Anyhoo - after I got stopped, I tried to short 3 more times. In hindsight it is very clear that the sellers were running out of steam (the wick disappeared on the 45 and the candle went nicely green). I forgot to stop and re-assess the situation. I finally had to agree with everyone else, but by then I had lost 30 ticks of stops three times and was mad at everyone except the guy running the show. (Thanks to Tarigal for processing this with me EOD.)

Here is the 15 on POT's afternoon:

 
This was my typical 'feed-the-winners' range ploy. We had new highs on volume, I waited to see what would happen and entered as we had a drop on no volume. I thought I had my stop out of the way, but it still got hit. I was thinking that all that volume had to mean something so I opted to short. I ended up selling to the winners and got stopped again. I went long on the new high and got stopped again.

Yikes... and this is all sim trading. The thing is, it looks as if someone was thinking the exact same thing that I was. POT was not going anywhere very far, but it is almost scary the way that my stops called the turn around points. This tells me that I was holding hands, looking both ways, and crossing the street with all the losers; I was on the wrong side of every one of those trades. What was I thinking? How can I change my thinking? How can I exploit it? I could move my stops further away, give it more room to work itself out. But I can get in trouble with that as well. I forget what the spread was on POT. Opinions?

I am getting a lot of exits spot on, which is pretty cool. In fact, I am tuning into much more of an intuitive feel with respect to some trades - e.g., this morning I knew CTSH was not going anywhere long before it came to my stop; it was almost as if I could 'sense' the shift in order flow. Reversing on more of my entries and trying to dial into what was going on would of left me sitting very well, e.g., on NFLX's morning reverse I had enough of a 'sense' to continue watching and reverse, but I only guessed at a target and didn't bother considering that this could of been the LOD. NFLX, BIDU, CTSH, and POT all had good reverse direction after I exited; I need to start making myself more aware of the possibility.

Another thing that I noticed today, on some of the morning's entries and the afternoon's range bound plays, I sometimes trade simply because there is a 'sign' and I think I need to. This morning for example: I set the market analyzer list up to flag exceptionally high and low volumes on the long and short range bars - theory being a change in volume often signals a change in order flow. My intention was to pull these up on the charts and watch them to see what would happen - but often I found myself 'just trading' because the signal was there and I 'needed' to trust the signal. Likewise with the afternoon's 'breakouts/breakdowns'; they were there, so trade them. I think this is a huge mistake and speaks to the core of my bad habits - it is looking at something outside of myself to make the trade/not trade decision. I need to maintain that control - I should not be handing the responsibility to trade off to a signal. That is my 'old' (so two weeks ago =) ) approach to trading. I choose when to participate - not the signal. 

Well - despite the weariness with which I approached today, and some mistakes, I convinced myself that last week wasn't a fluke. Crazy mind games. I am going to try and keep my blog entries shorter because this takes a lot of time, but I feel that today's blog time was very productive.

Taking one week at a time on the live trading front.

Trade well.

Details:

AEIS

APC

BIDU

CMG

CTSH

DRN

IPXL

NFLX

POT

UPRO

V