The following actions will be taken on Monday:
TECH: Hold position
ALVR: Hold position. Will sell down 1,000 shares if falling momentum is confirmed after Monday close.
AVNX: Sell down 5,000 shares
ROCM: Hold position. Will pick up 1/3 position if trend change on daily chart.
LACO: Sell down 1,000 shares
BRK.B: Buy 5 shares
CEPH: Sell down 200 shares
AAPL: Hold thru earnings. Buy 1/4 position on sell down of good earnings.
DNDN: Hold
IOM: Hold
MDVN: Hold
NFX: Hold
AOB: Hold
APA: Buy 100 shares
developing.......
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5 comments:
WTC
I know this is no consolation to your woes today. But, I have done the same things a million times in the past. The one thing that really change my whole trading technique and attitude was reading "Reminiscences of a Stock Operator". If you don't have the time to read it there is a great site that has brief overviews of Jesse Livermore's life and trading techniques. It is worth its weight in gold. I have a little different problem than you. I do a monthly analysis of how I think the market will perform. As I look at my Oct. projection I had written "sharp drop" Oct 17. Great call but I failed to act on it. After all these years I still don't trust what my projections are telling me and I fail to act. So instead of this being a great day because I should have been short, I am dead even because I did not act on the short side. Have been fighting this for years. Take a look at the Livermore site, it is a short version of JL's stock operation. Truly amazing stuff.
http://www.jesse-livermore.com/
Best. jfs
jfs,
Thanks for the recommendation and the thought. I have read Reminiscences and found it to be educational and inspiring. In fact, I follow Jessie's stock trading technique of averaging up (rather than averaging down)into trades by taking either 1/3 or 1/4 positions at a time. Very similar to Jessie's approach. I will hold the first position and add to it only if it goes my way and will cut it loose altogether within the first position if I have a drawdown of 25%. In fact, I am doing very well YTD on the equity side of things. Funny that you said that about the big drop. I was doing my Saturday review two weeks ago and was stunned to see, in my analysis, what I was certain was an impending correction on the horizon. In fact, I spent the better part of that morning two weeks ago calculating how many YM futures I would need to short to hedge my equity porfolio by 75%. And like you, I did not act on it.
I do not apply the Livermore approach to day trading futures due to the short holding period. Matter of fact, the evaluation technique I use is sound and fairly accurate, it's my execution and discipline. It is amazing that I still float too many contracts out there with no stops.....here were the violations that I caused:
1. No setup to get in (impulse trade)
2. No stops to get out (hope and praying technique)
3. Changed day trade into swing trade
4. Let ego, stubbornness and failure to accept loss cloud my judgement
It doesn't happen that often. In fact, I have had a fairly good handle on it for some time.
Is there any particular part of the book that I should re-read in your opinion that may help me re focus that part of my approach?
Again, many thanks for the thoughts.
Hi WCT,
Like jfs, I too have done this more times than I would like to admit - staying in a losing trade, hoping that the market would reverse only to see my loses grow and grow.
It was interesting to read your self-assessment of your trading day. I have written similar things in my journal about my lack of focus and discipline. During one period of a string of losing trades, I taped notes on my computer screen to continuously remind myself of my trading rules and trading don'ts.
It has taken me a long time to realize that small loses can be easily recovered in the next few trades. Large losses are so psychologically damaging, that they take a long time, if ever, to recover.
It has also taken me a long time, lots of experience, to learn to read what the market is doing, rather than thinking in terms of what the market should be doing.
Keep statistics on the market.
Understand the typical market cycles - both long term and short term cycles.
Perhaps - stand aside for a while and just observe what the market does from day to day, until you start to understand the ups and downs of the market cycles.
Understand that the market typically trades in small range, equilibrium zones 70% of the time. The other 30% of the time, the market is breaking out of these zones to create a new equilibrium zone. DO NOT FADE THESE BREAKOUTS, which follow periods of quiet, narrow range, or equilibrium zone periods.
My favorite quote from "Reminiscences of a Stock Operator", Page 59:
"There is nothing like losing all you have in the world for teaching you what not to do. And when you know what not to do in order not to lose money, you begin to learn what to do in order to win."
Charles
Charles,
Thanks for your thoughts and insights. I have this little thorn in my side when it comes to my futures trading. You hit the nail on the head when you mentioned keeping "statistics". I know that is what I need to do ALL THE TIME. I begin the futures trading day doing just that (as well as following trade setup rules), but then this impatient, stubborn, bored side of me takes over after a couple of straight losses. This usually happens in the afternoon session. The trick is for me to stay within the rules-statistics mode ALL THE TIME. I will certainly be working on this moving forward. My goal this week is to do just that - rule based futures trading and keeping statistics on each and every move. If, at the end of the week I have a drawdown in my account, I will be all giggles due to my ability to stay within this discipline framework. Something about my reaction to the the afternoon session, the grind that is day trading and my belief that I "should be further along" by this time in the day. Right now, it is not about the dollar amount, but I know that if I continue on this path of straying away from rules and statistics, it one day will be about the dollar amount. Many thanks for your ideas.
Charles,
Thanks for your thoughts and insights. I have this little thorn in my side when it comes to my futures trading. You hit the nail on the head when you mentioned keeping "statistics". I know that is what I need to do ALL THE TIME. I begin the futures trading day doing just that (as well as following trade setup rules), but then this impatient, stubborn, bored side of me takes over after a couple of straight losses. This usually happens in the afternoon session. The trick is for me to stay within the rules-statistics mode ALL THE TIME. I will certainly be working on this moving forward. My goal this week is to do just that - rule based futures trading and keeping statistics on each and every move. If, at the end of the week I have a drawdown in my account, I will be all giggles due to my ability to stay within this discipline framework. Something about my reaction to the the afternoon session, the grind that is day trading and my belief that I "should be further along" by this time in the day. Right now, it is not about the dollar amount, but I know that if I continue on this path of straying away from rules and statistics, it one day will be about the dollar amount. Many thanks for your ideas.
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