Nov 22, 2008

All off (Friday's trades)

The market's choppy but my current streak of consecutive days without a profit is ridiculous. It actually feels like I'll never make another profitable trade :)

I did start looking at sector stocks and checking the strong/weak sectors for candidates. I need to review previous charts and see what I'm doing wrong. Could be that my watchlist is overpopulated with candidates that aren't ideal for my type of trading. 

Traded INFY, PEP, HNZ and I think one other that I can't think of. Anyway, not all were losers but I was red at the end of the day. The thing that keeps me going is the fact that I know a big day is within me and I just need a few good days to get my confidence back up.


Eyal said...

This week wasn't an easy one overall, I consider this week's action rather "abnormal". I finished it just barely profitable and even that is just on account of one good/lucky day.

At the risk of sounding like I know better (which I don't think I do) I would offer a slightly different angle and that is not to make too many changes to your trading too often. Maybe even going back to basics, reviewing what worked in the past, what isn't working now and trying to repeat the ones that worked using small positions till you "stabilize your swing".

TL said...

While the past few weeks have been quite hard to trade, I think there are opportunities as always. The key is to catch them when they come, which is an area that I have to improve as well.

I have been following your blog for a while, and from my observation, you take profits really soon. I know there are a thousand different ways to make money, but just from my own experience, it's very hard to sustain such a high win rate under different market conditions for that approach to make money (or I just didn't figure out how just yet...). And if your approach is to trade trend, it's really important to let the profits run. For your reference, I don't take profits less than 6R. Yes, good gainers did reverse sometimes, but that works fine for me. Hope this help.


OONR7 said...

eyal: thanks for the comment. Yeah, I'm doing exactly what you noted and checking out my charts from the past. I think my overall problem right now is my watchlist and just relying on particular candle formations rather than looking at the big picture, especially the opening range action. For example, if I can isolate and look for short with stocks that are trading within the lower part of the opening range (:15) I can a) narrow my watchlist and b) just look at the price action on the chart to make my entry. I've also missed some nice entries this week for one reason or another and that certainly doesn't help. I just seem to be a little late to the party if you know what I mean.

TL: you hit on a very good point. Managing my exits is a big problem for me right now. It's something I'm working on to find a way to still limit my losses without taking me out of the game. What's been happening to me lately is that I get down early then fight and claw my way back to breakeven or even a respectable loss. Mentally I say to myself that I have 'escaped' major damage and I'd rather wait till tomorrow to start fresh. Its this continuous circle that has to stop. I absolutely agree that even though the market's been tough lately... there have still be good opportunities. I just haven't caught them. Thanks for the advice about taking profits but I'm not sure any of my trades hit 6R :) I think you're the one that needs to start a blog to reveal your strategy!!!!

TraderAm said...

Hello 00nr7.
I don't think you are doing much wrong to be honest. You are still managing your risk okay so no major losing days. Generally, It doesn't matter which strategy you have IMO, there will always be periods where it doesn't perfrom as well as optimum.

Looking at previous charts is good idea. It may well be though that you find trades working say 3 months ago which didn't work last couple of weeks. But who's to say that they won't work next month ?
As long as you can determine that your entry reasons are the same then you are still trading to your plan.

Exits are always tricky. But taking 1/2 at 1R or whatever and moving stop to breakeven seems to me to be a sensible approach. And you are doing that anyway ?

Watchlist is problem I have as well. IB is not giving me enough candidates, so I am also casting the net wider and trying to pick the best looking charts.

Keep at it. You'll be fine.

bl said...

Friday was a fade except for gold stocks...those must have come up on your scan: abx au. The XAU was the only ETF gap and continuation play. The C bad news created a broker/financial sell off with gs ms mer jpm(slipped 5 pts from the open) even thought up 2-16% premkt. A gimmie imo. JWN was S&P dngrd Thrs premkt= short. I like those cause/effect high probability correlations. The bias of the market is down and traders get spooked.

OONR7 said...

traderam: thanks for your comments. Right now, my trading is not in balance. What I mean by that is my entry selection is not providing a high probability of success and, as a consequence, I ended up cutting my winners (when I get them) short to end my day at breakeven. At the core of my problems is not necessarily my trading style (which I am not going to change) but rather the selection of stocks to trade. For instance, right now when I have my watchlist in place I basically look to trade any stock with a viable entry. However, my definition of 'viable entry' has changed over the course of the last two months and I need to get back to being strict about my selection.
On the other hand... there have been plenty of good entries I have passed on, particularly that have occurred at the OR high or low - because they weren't narrow enough or weren't a specific type of candle I was looking for. I'm hoping to get a post up later to detail some of me refinements. Thanks again for your vote of confidence and I hope to be posting some nice winning trades just like you. BTW - I still think the IB screenshots we have been posting are the bomb.

bl: some gold stocks were on my watchlist but if you look at my comments above you'll see why I didn't enter. You may be surprised to know that I am now starting to look at the sectors to look for strength/weakness. Basic materials rocked on Friday.

TL said...

If I get more 6R winners, I'd be more than happy to blog~ Seriously, I did catch some, others I just closed them EOD. I tighten stops too, but for the way I trade, getting big winners is more important than limiting losers.

I'm sure you follow Trader-X and Jamie's blog. They take partials too, but only after substantial profits. It's not uncommonly to see they catch some "outrageous" 10R+ trades with the recent volatility. What I'm saying is, if taking quick profits works fine for you, then by all means keep it. If it's not, you may consider catch the big moves. In the end, only you know what works best for you.

Good trading,


OONR7 said...

tl: I totally understand what you're saying and have had this discussion with Eyal and Greytrader in the past. However, I simply hate seeing a very nice $1 gain turn into a full 1R loss. I think the best of both worlds for me is once price hits 1R I will then sell half my shares at breakeven and let the other half ride. This way if a quick spike or surge goes against me I would have limited my loss yet still remained in the trade (hopefully).
But really, I wouldn't have to worry as much with my exit strategy if I started making better trades. That where I first need to start. Because you can have the best exit strategy in the world but if you're not focused on the right stocks than it's all for not.