Lessons learned from my -$165.50 loss on my first day back to live trading!

Made a lot of mistakes but two dumb decisions in particular turned what should have been a green first day back to live trading, into a max loss day instead, to the tune of -$165.50.  

I tried to be patient and wait out the first 30 minutes after the open (as per my rules) before taking my first trade but went long $ETSY just before 10am thereby breaking the aforementioned rule. Although I don't want to be too hard on myself for breaking this rule and more over taking a mediocre set-up due to my anxiety to get some skin in the game; there were 2 glaring reasons for me not to have taken this trade. Firstly, the low of the pull back in $ETSY undercut the low of the opening 5-minute candle where as this was not the case in the $QQQ. Secondly, none of the other 6 ideas I had on watch from last night were trading above the previous day's high unlike the $QQQ which was. This glaring divergence should have kept me on the sidelines or at least from taking any long trades. None the less, anxiety got the better of me and I jumped in only to suffer an early loss on the day.

My second trade came in $SQ and this one was an extremely poor trade! After just tweeting that I was looking to short one of the high beta names but would not chase and instead wait for a low risk short entry; I ended up chasing $SQ short! lol. I recognized this and took 1/2 my planned loss. Once again breaking my initial plan. Ironically, if I had stuck with my initial trade; I'd never have gotten close to getting stopped out! 

My third trade of the day was once again in $SQ and the set-up I really should have waited for. What should have been the trade to save my day and make up for all my earlier errors turned out to be a 3rd loser on the hop instead!

I made 2 critical decisions that turned my day into a sure red day. Firstly I opened a second position (my 4th trade) in $MOMO. Given that I only allow myself 3 stop outs for the day, had already suffered 2 stop outs and was risk of suffering a 3rd with the $SQ open position; I shouldn't have touched $MOMO. Further I only allow my self one open position at a time unless I've already locked in profit and have my stop at b/e on the open position. 

As a consequence of being worried about suffering a daily loss in excess of my max planned loss; I pre-maturely adjusted my stop loss in $SQ (breaking my trade plan yet again) which invariably got triggered just before $SQ wound up rolling over. Then not long after; I also got stopped out of $MOMO sealing my faith of a max loss on my first day back live.

Things I did well and need to continue doing:

1. Waiting out the first 30 minutes after the open (for the most part);

2. Identifying and trading with the trend of the market indexes.

3. Shifting my bias to the short side once I noticed the indexes break down and stocks on my watch list turning down. Then adding 2 high beta names to my watch list to play off the market.

4. Not revenge trading after taking the early hit on $ETSY. 

Mistakes:

1. Not identifying the divergence between the indexes and the stocks on my watch list.

2. Over sizing on excess buy sizing for a stop loss above the pivot low which did not make sense. 

3. Chasing $SQ short when there was clearly no set-up at the time. 

4. Not sticking to my initial trade plans and waiting for them to play out. 

5. Opening a second trade when I was already at risk of hitting my max. daily loss from the first open position. 

Plan for Monday:

1. Build my usual nightly watch list on Sunday night.

2. Vet gappers for interesting set-ups in the pre-market.

3. After the open until 10:00am; a) identify which direction the indexes ($SPY, $QQQ and $IWM) are trending in if at all. b) identify whether or not stocks on watch are confirming the move in the  indexes or diverging. c) concurrently, monitor my 2% breakout and breakdown scans on Finviz for further interesting ideas. While also looking for any trends in terms of breakouts vs breakdowns, sector/industry trends that may give clues as to what stocks to trade and what my bias on the day should be. 

4. Wait patiently for low risk intra-day set-ups (near the 5-minute 9-ema) the that align with the overall market intra-day trend, trends or divergences I have picked up on as well as the daily bias of the individual stock. 

5. Come up with individual trade plans after identifying A+ set-ups with better than 2:1 risk/reward and then letting them play out if I get triggered in.

6. Remind myself that you can be a profitable trader once I follow your rules! 

I'm so looking forward to trading on Monday but I'm gonna relax and enjoy my weekend until then. HAGW all!!! 

Monday September 18th, 2017 trading review....-$113.93

1. So my stock selection continues to be on point. I definitely traded the best stock there was to trade today.

2. My risk management and position sizing for the most part are also on point. Despite my poor entries and exits; I still haven't blown my account up yet...lol

3. My struggle now is with trusting my entry selection strategy. As a result of this I missed really good opportunities today and ended up once again forcing poor trades:

Solution:

I must commit to a single stock after the open; a single time frame; entry strategy and exit strategy. So:

a) Going forward; I will focus on trading one stock after the open. I may keep an eye on 1-3 in pre-market but at then open I will drill down to a single ticker. I will wait for the open before place any trades. Further I will focus on the 1-minute chart from the open till around 10/10:30am. Then switch focus to the 5-minute chart from then on. 

b) I will wait for pullbacks to the 9/20 ema before looking for long/short entries. Risk/reward based on the next level of resistance/support (on daily, 30 minute, 5 minute and 1 minute charts) must be greater than 2:1. 

c) I will exit 1/2 of the position when unrealized profits are equal to 2x intial risk taken on the trade; no questions asked. Then I will hold the remainder of the position until the price confirms a trend reversal using the 9/20 ema's, pivot highs/lows and trend lines as guides. 

3rd straight red day of the week and shutting it down till Monday...

So after a solid start to the month; I've now hit a red streak with my 3rd consecutive red day this week. I started the month of September with around $1,100 in equity in my SureTrader account and by the close of the 6th; I'd managed to grow my account by about 25%. 

However, ever since then (with the exception of Monday this week) its been pretty much all down hill...all red days. With a loss of -$96.12 today; this now marks my 5th red day in the last 6 trading sessions. 

Today my sole focus was on $HALO and boy was this one tough trader. See the trades I took below:

I took 3 trades in total in it; and in earnest the first 2 were solid trades. I rightly got out promptly after the games just before the open. Then I waited patiently for the pullback after the stock made the push higher at the moment and after the move was clearly not going to follow through; I got out quickly instead of letting price hit my initial stop. 

However, my 3rd trades is where I made the big mistake. This was a forced trade as the stock had clearly been showing that it couldn't go higher and odds of a sell off was high after it put in a lower high and had formed 3 topping tails in the last 4 candle before my stop out. After already making the mistake of entering long with no solid set-up and several bearish signals cropping up; I really need to exit this trade earlier instead of letting it hit my hard stop. 

Since my max stop with my broker is exactly $100 and it I hadn't exactly hit $100 in realized losses on the day (although I was close); I could have continued trading. I was so frustrated by my poor decisions making and losing money for yet another day that I was tempted to continue trading in attempt to make back my losses even though I was pretty much at my max daily stop. 

However, I dug deep; reminded myself that I'm in it for the long haul and did the right thing. I shut it down and walked away. I will use the weekend to study my trades; re-focus and come back fresh and better prepared on Monday. I am in this game for the long haul and not going to let a few bad days derail me. I will become consistently profitable and eventually I will become a full time day trader!!!

Paying the price once again due to lack of focus with -$84.98 day

Today I had too many tickers (4) on my watches. I usually have 3 or less solid ideas. I added a 4th ticker off Twitter that I had initially passed on after reviewing it previously since it had popped up in my gappers scan. So I ended up with 4 tickers on watch and was switching between them like a headless chicken without a solid high conviction plan for none of them. This caused me to make some rash trades and to lose money on a day that though some what tough I honestly should have been hitting my daily goal!

Trade#1:

The idea and 5-minute set-up behind this trade wasn't the worst in the world. However, the mistake I made here was not waiting for the confirmed break of the $65 level which was a major level of support on the daily chart. 

Trade #2:

Really, really solid set-up that I should have made money on but instead botched up due to getting overly aggressive. 

Trade #3 & #4:

My 3rd and 4th trades on the day are explained above. The third trade wasn't the worse but after being down on the after 3 trades; I probably should have let the forth one go especially with the stock being so extended to the downside on multiple time frames.

LESSONS LEARNED: Keep no more than 3 high conviction ideas on watch with clear plans for how I will trade each one. Then once the market opens; I need to zero in one of the three. Further if I've already placed a trade in one of them in pre-market; that should in most instances be the stock that gets all of my attention on the open given my limitations of screen real estate and buying power at the moment. Focus on trading one stock really really well!!

Kickin' the 2nd week of September off with a $72.65 profit Monday!

So although my I did manage to have a green day today which was pleasing; once again I left a lot of profits on the table mainly on account of not following my trade management rules!

First trade I took was in $KURA; long the break of pre-market high:

I left at least $30-$40 on the table from this trade as I really should have locked in 1/2 in the $13.40's.  Also I should have been quicker to close out the trade at break even instead of 15 cents below my entry.

The second trade I took was short $MRNS on the first 1-minute pullback then doubling up my short position on the second 1-minute pullback:

If I'd have followed my trading rules: my first cover would have been around $4.39ish instead of at $4.59. So that's $50 I left on the tablet there. Then my second cover which I took at $4.61 really should have been around $4.21 instead. Which means that with this cover I left another $100 or so on the table. 

In total; poor trade management today resulted in an opportunity cost of roughly $180-$190 in profits! Now don't get me wrong; I am grateful that I'm starting to see more green days than red days which means that I am progressing towards becoming a better trader. However, I know that the potential is there for me to achieve even greater profits. 

So going forward; I'm going to try my very best to focus on the process aka stick to my rules as I know that the end result will be bigger profits at the end of the week/month!