Three GRADE "F" trades...
I had a profitable day today, but only just barely, and I didn't really deserve to, even though I did at least manage, for once, not to overtrade too terribly much.
Hoping that I might cure myself of certain mistakes I continually repeat, I thought I'd try a little bit of self-mortification/humiliation. So I'm posting charts that depict my three grade "F" trades today. These aren't, by far, the worst trades I've ever made, but they all strike me as rather inexcusable. Insults, piteously condescending critiques, and so on, would be welcome (e.g., "I've lost what little respect I had for you, KF" or "Bad work, dude!" or "I'm sure you'll do better someday...").
home.pacbell.net
As you will see, the first trade - short PSFT at 0901 PSFT - was a very weak set-up. It turned into my worst loss of the day - as in all justice it should have. I should add to what I included on the web-page that the larger market, at just that moment, couldn't have been more primed for a bounce - the COMPX was just hitting the rather critical support level ca. 1850, at what turned out to be the LOD. Truly an F-minus trade! I guess I was "thinking" - I know, that's being overly charitable - that PSFT, having already violated a critical support level, would follow through on its relative weakness with some kind of catastrophic drop along with the index - right... (Actually, that's one of my most typical mistakes - maybe the crash experience of seeing so many "hard" support levels melting like butter day after day got too deeply emblazoned on my brainpan in 2000...)
On the second trade - long IDPH at 1123 PST - I impulsively went long an oversold stock entering its opening gap - right after the FOMC announcement while the market was still figuring itself out. Having been "hunting" the stock all day, I entered the order immediately upon receiving an "alert" (actually, a ready-to-go "automated" Tradestation order triggered by a line break) without first checking the chart (a habit, I guess, from when I was trading a market-order oriented "system") - and without noticing that the price was already about 0.2 above where I had intended to enter. I got stopped out and missed the actual move later on.
The third trade resulted from overanticipation of a breakout from DELL at 1202 PST, when the market was relatively far into its post-FOMC rally. Instead of actually making a new high and proceeding to break out, DELL tagged its then-HOD (27.33, my fill), then reversed. Not having ever traded DELL before, I'd convinced myself that it was a high enough volume "big boy" not to present much risk and to leave room for fast exits - so I'd doubled my usual position size. Again, I was stopped out, and missed the real move (not much of one) later on. |
