AMZN practice trade

Here's my first and only trade for today. Long in AMZN off the reversal candle at 11:45am. I have some things to take care of so I cannot stay at the computer. I'll take my 63 cents and run! The spike above my exit price came after I exited and I don't feel a bit bad about missing the extra 30 cents (it's 30 cents and not 41 cents because of the spread).

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Good trading to all!

First practice trade in quite a while...

I've been really busy with home upgrade projects since the return from our long bike trip and have been away from the markets. I should revise that by saying that I have had the charts up a few times over the past month but haven't made any practice trades at all. That ended this afternoon. I spent about 30 minutes measuring and getting a feel for movement again after my long hiatus. Then, I saw this extreme move up and decided to short at the high point. Good idea. With up to 60 cents available to me on this down move, I was out far too soon (as you can see from the chart) but my instincts for direction changes are still pretty good and for that I am happy.

Been a Long Time

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Where I was during my absence...

Mrs Bluecollar decided to go on a trip with her niece so I decided to live out a dream... one of those "bucket list" items. I flew to Vegas, rented a big Harley, then set out for the monuments and canyons of the southwest! Hoover Dam, Arizona Desert in 105 degree temps, Grand Canyon, Route 89A from Flagstaff to Sedona, crossing Navajo Nation to Monument Valley, Fry Canyon and Glen Canyon, the mighty Colorado River, Bryce Canyon, and the list goes on. Over 1300 miles alone with a map and an awesome bike.

It really was a dream come true.

Back in the Saddle

I've been away for a while and I am just back to the computer yesterday and today. Took a stop loss on a trade yesterday EOD; only did the one trade.
I spent most of this morning helping a friend move then took this one short at what seemed like a great breakdown spot. As it turned out, my instincts were correct but as you can see from the chart, I was out far too early. Gain of 18 cents on the trade with up to 68 cents available to me. I'd like to chalk it up to being rusty because I was away from the markets!

just the one trade today, I believe

Looks like my exit at 10:57am was very timely. Momentum had indeed dried up and the stock has been lower since. I had speculated that TNA would oscillate over the S2 pivot line and it appears to be doing that up to present. Where it goes from here, I don't know.

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It's 1:30 pm and I've only made the one practice trade today. A lot of distractions around me plus I have an appointment at 3:00pm. So, I will check out the charts as I get ready for my appt but not get involved...

Exit at $54.39

Exited here... perhaps a bit too soon but it feels like Momo is slowing.

+46 cents

First today

Long at $53.93.

Not sure about this one... there was a whole lot of craziness with the Bid/Ask at this level for 10-15 minutes after I got in. This one could come crashing down or some extended oscillation over the S2 pivot.

Exit with Gain

And finally out of this trade. Got a nice push back toward the HOD and I exited into the strength. + $1.05 is my best gainer in recent memory, if not my best ever.

Amazing how relaxing and enjoyable it is to do the following:

1. Enter with the trend

2. Enter early and not during consolidation

3. Avoiding early cut and run exit.

4. Faithfully stopping out early trades then catching a winner that makes up for it.

What I need to consider:

1. Trend is the friend

2. Look for chances to add to winning trades

3. Relax.

thinking ahead...

Just thinking ahead on this trade I have going. TNA and QQQ have closed the gap from the morning's low open, but SPY has not. SPY started to close the gap just moments ago and TNA is starting to gain some energy though it hasn't broken the consolidation area using $59.40 as resistance. If SPY gets some gusto and runs up to close the morning gap, TNA will likely reach the second target of $59.70 that I mentioned in an earlier post.

Target hit, would LOVE to exit here...

$59.40 hit and I would like to be on record as wanting to exit here. I'd then wait patiently for another possible push higher.

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+ $1.30

Reinvigorated...

The trade is reinvigorated and gathering energy. If it doesn't double-top, I see it going to the $59.40 area. Maybe $59.70 if there's lots of EOD momo.

Trade lost steam

Trade still working but has drooped from the peak. I had about 97 cents at the highest point. It occurs to me that an experienced trader would have been looking for a place to add to the winner. I have to start thinking that way...

Judgement/Gut loses out, trade still working

+ 80 cents
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Doesn't matter, I can't take profits anyway because of my rules, or at least I can't until 15 mins before EOD. It would be nice if this is still working then.

Gut tells me to get out

My gut tells me to exit with my 60 cent winner on the high volume spike. My exit rules keep me in. Let's see whether my judgement is correct or is the rule correct...?

3rd of the day

Long TNA at $58.12.

stopped out.

my gut told me that momo was waning and that I should exit with my 15 cent winner. However, my pledge was to stopout all trades today; no discretionary exits allowed.
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Important for me to pay attention to the fact that my original stop would have held and I'd still be in the trade.

moved stop up, momo waning

2nd of the day

Long here.

Stopped out.

first of the day

first of the day. Short TNA, this one might not break down though... will let my trades stop out today... no discretionary exits.

$59.10 hit and sinking still... I wonder if it will rebound to consolidate over $59.10 area? Note that price did bounce off the Pivot and rose to my entry before dropping again. I could have played long when price bounced off the pivot line. Although, my stop would have held and if I had just stayed in, I'd be up a whole lot right now! It might be time to reinstitute my exit rules, despite how limiting and boring (?) they were to try and trade.

First of the Day

Here's my first practice trade of the day. A short of TNA at 59.70 and profit taking cover at 59.42 at the Pivot as I expected a bounce. We might see TNA drop to the $59.10 area later.

Important to note: The white oval encircles the second touch of the Magenta colored line that I was watching from Friday, an area I decided to watch for potential Support/Resistance. It was hardly resistance the first time it was touched during the strong upward drive from this morning. But it sure held as temporary support as I surmised with price consolidating around it for a short time. A likely point of resistance in the future.

The Channel I discussed in my earlier post...

In my earlier post, I mentioned the channel that was established by two of the levels I had drawn on the chart Friday. The two levels turned out to be the channel in which TNA traded from 10:15 am until the close, though the upper level wasn't approached again until EOD.

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No trades today, I was distracted by job searching. I'm still looking for a second-shift position that will allow me to stay at the computer during the trading day. My future trading account $ are being eaten away by monthly expenses as a result of Mrs. Bluecollar's job loss in December. It really threw a wrench into my plan to learn to trade without stress. So, we've even talked about "refilling the account" by putting trading on hold while I get a day-job if an evening job doesn't come forth soon. It would be a setback for sure, but would not diminish my drive to one day be a self-employed professional trader. The hiatus option is going to be the last one we choose, but is a real possibility. I hate the thought of it, but my concern was always with having the money to support myself during the learning phase, not with being able to eventually trade successfully.

There are a lot of unknowns, but one thing is still true: I love the markets and I am still as excited by trading as the first day I started paying attention to it. My mouth waters at the thought of getting to the computer each day to mine the charts for patterns.

Friday's last trade and today...

Isn't it interesting that on Friday, my last move of the day was to short TNA for an expected breakdown, but closed it essentially even before the day ended. Going to the text of one of my early posts on Friday, I noted that I was expecting TNA to break down to the $60.10 to 60.20 area or even down to $59.65. Well, as I write this, TNA is below both those levels, indicating my short choice at EOD Friday was a good read and my level of $59.65 was relevant... that is where price rebounded to after the opening drive today. The lower orange line on the chart was another level I was looking at Friday, though I didn't think it would be hit that day. Well, if you note the lower, more recent chart, it was just hit and price bounced off it; with a high level of trader participation at that spot (volume spike).

It would appear that my two levels are the channel boundaries inside which TNA is travelling for the time being.

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As to my short at the end of day Friday, my original stop line would have held and allowed me to stay in for the drop. My revised stop line would not have. Had I not closed the trade willingly, it would have stopped out on a "punked out" candle at 3:55 though again, my orginal stop would have held up; note the long upper wick on the 3:55 pm candle just before the drop that extended into today. I continue to be encouraged by my instincts and my overall reading of the charts. I definitely need a lot of work on execution. Of course, I would not have held over night and certainly not over the weekend. But it is enough to know that I was on the right track.

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I am still keeping an eye on that level that I referenced from Friday... the one at which I had thought about entering long for the eventual move up. I marked it with the magenta colored line at $60.31. I am making no predictions, but I think it will show some relevance, if only for a brief time period. Releveance meaning that some activity may take place there. Anyone who got short at that level and was suffering as the stock climbed away from them on Friday afternoon was rewarded with a nice gain this morning when TNA dropped below their entry spot. So maybe the "hope and pray" traders got out and activity will be minimal at the magenta line. We'll see what happens when or if price retests that spot. I'm still learning about this stuff ; watching these levels that my experience has shown as often significant is just another bend on the upward sloping learning curve.

Tally for the day

Here's how the day ended.

EOD volatility

The market is closed and the chart is this upper screenshot. Vol continued through the close, but close was weak as compared to my short entry price. Traders were really raising hell with the price.

If I had stayed in a just a few more minutes I would have had a chance to exit with a 17 cent gainer. But volatility is high and the next candle was the tall green one on the lower chart which would have tripped my stop had I stayed in. two minutes left as I type this and price is dipping to $60.65 on typically high EOD volume.

Last of the day

With ten mins left in the day, I'm out with a two cent loss, not waiting for my stop to hit. My guess that the market would tank did not come to pass, so if my idea is wrong, I'm "heading for the showers." A good weekend to all.

Last of the day, I followed up on my sense that the market would dump at the EOD. I got a little of it started here, although as I continue type this post the market has shot up again on high volatility. I think I'll just exit and take a small gain instead of waiting for the big drop.

TNA is lagging

TNA is not dropping in concert with the pullbacks in the QQQ and the SPY right now. Not sure what is going on, usually they move relative to one another. Two things come to mind, but I am just speculating...

1. TNA will soon drop really quickly to catch up.

2. TNA players are artificially propping up the price in the art of gamesmanship in order to lure as many traders into the trap as possible.

First and Second of the day

First of the day was a short at the 1:05pm candle. I thought price would retreat off the R1 pivot and continue down. Got stopped out. Short orange line at the 1:20pm candle suggests where I thought it would be good to go long, but I didn't pull the trigger. That is purely a mental lapse and a missed opportunity on a nice winner. I must get to the root of the cause why I struggle to risk in favor of trend. Because this was an "impulse" area of mine and because it was the start of what would have been a winning trade, I have to wonder how many real-money traders got short at that spot ($60.30) and are in agony now because they didn't stop out. Makes me want to keep an eye on that area if price does collapse as the day goes on. Might make a nice level of support, if only temporary. I'm going to mark it with a magenta colored line so I won't forget the spot.

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Second of the day: Short off the touch of the R2 pivot after a significant volume spike. Price consolidated for a couple candles then drooped. The indices hit support levels so I exited TNA at the same time. Good idea because it was just prior to the pop that shows in the chart at right. My sense is that there is more downside to come, but I took a gain when momo seemed to die. My gut is telling me price will go down in the $60.10-$60.20 area by EOD; maybe as low as $59.65 area. Never certain though...

Last Night's "Premonition"

I've struggled the last two days... six stop outs in eight trades while getting lost/mired in choppy consolidation (see top picture of my results since Wednesday). I am trying to broaden my scope by trading with trend instead of playing for reversals. This is new to me and the unfamiliarity is showing in my performance. Often, I feel like I am part of the market; that I know where it is going before it gets there. But over the past couple days, I have been lost. As if I am just beginning my journey. This is frustrating and I have literally been losing sleep over it. Last night (early this morning) at about 3:00 AM, I was awake and at my computer mapping the SPY, studying the charts to determine key S&R levels then ranking them in order of importance. I began nodding off in my chair around 5:15 AM so I went to bed. When I got up again, I went to the charts to look at what I had done. I couldn't remember much of the work I had done but found these two targeted levels denoted by orange lines on SPY. The market opened with a gap-up but dropped immediately and continued down. Watching CNBC while eating my oatmeal, I heard Cramer say to Melissa Lee and David Faber how he was surprised the markets were so weak with the relatively good data that had been announced (I'm not sure what data it was). But the charts had predicted the weakness and I saw it at about 4:00 this morning. I marked it on the chart. And my lower orange line held as Support for the S&P between 10:00 - 10:15 AM. There has been a nice bounce since then that the above chart only partially shows, since it has been roughly twenty-five minutes since I captured the screen-shot.

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I can't let my frustration and anxiety over personal finances here at home keep me from continuing my trading education. I really believe I am on the right path and that I have an understanding of what the market is doing often enough to make money trading. But I haven't developed a method, an edge, that allows me to consistently and profitably manage what I sense from the charts. And I am prone to lapses in discipline; getting caught up in the knee-jerk trading of a newcomer. This limitation is strictly mental/psychological. I am working on this part as I continue to study charting and momentum of trading.

I exercise, I try to meditate, I read books and blogs about psychology, I am signed up for a yoga class which I haven't yet attended, I watch my sugar intake and manage my diet much better than in the past, I gave up caffeine last November and I have stopped drinking alcohol as of early February 2012. I don't use drugs, prescribed or recreational. I occasionally take advil and when my pollen allergies get unbearable, I take Loratidine (Claritin). Much of this is to instill self-discipline and healthy habit. Physically, I feel better: I have increased my muscle mass and my cardio health. I don't get the spikes and crashes related to caffeine, sugar, or the downer effects from alcohol. Mentally, I am still a work in progress. I have a long way to go to catch up to the gains I've made in physical fitness.

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As I have written in the past. whether I learn to trade for a living or not, I will be a better person through the attempt. Of that, I am certain.

Yesterday, Tuesday the 24th

For some reason, I was not motivated to blog about my practice trading yesterday. Here is how it went. One trade in TNA and a small gain. To the right are the chart and the day's tally.

This was a reversal play that dipped some after I got in long. It actually dropped three cents below my stop line but I held it anticipating that it was a move solely intended to trip stops before moving up. After the pop, TNA started back down and continued in that direction for the next 30 minutes. So perhaps the best narrative of that 1:30 pm pop is that it was a move based solely on triggered stops and once that buying died, so did the move up. Short covering, but no continuation / organic buying. It's good info to think about, but in the end, it pays to be nimble when trading for reversal against the primary direction of the trend in which one is involved. Here, the primary direction is down after the 11:10 am tall green candle (not pictured) accompanied by above-average volume.

And There It Is...Target Hit!

Afte the pull back, TNA went on to hit my projected target (Orange Line) on HUGE volume. Looks like some big money traders had the same thought...

Not quite there...

My prediction for $53.77 did not quite come to pass., as denoted by the orange line on my earler chart. TNA got to $53.60, created two dojis, then reversed as shown on the chart to the right. Price pulled back from the HOD, consolidated, then has dropped nicely in the most recent candle on the chart.

I have not taken a second practice trade today thus far. I am content to watch and learn...

Exit, nice pop and not waiting to stop it out...

I used discretion instead of rules here. It violates my rules of exit but it sure seemed like momo had stalled; +60 cent winner.

Red line was my stop. Green the entry, Orange horizontal line above is my target area for any continuation move up...

The short orange line at the 9:50 cnadle was my "impulse" buy spot that I did not act upon. It seemed like the "sucker's bet" spot to go long.

first of the day

In long on the first of the day. Not sure about this one... I am expecting to get "punked" by the big players driving price down to trip stops. But,

I am going to go back to my exit rules and see what happens... I wanted to take profit at $52.70 with a 40 cent gain. But, I 'll stay in to see what happens. Price is dipping again toward my entry line.

Great Quote

"It is amazing that people who think we cannot afford to pay for doctors, hospitals, and medication somehow think that we can afford to pay for doctors, hospitals, medication and a government bureaucracy to administer it."

~Thomas Sowell

April 15th - Photos

On April 15th, the weather here in the northeastern US was perfect and we got on the motorcycle and rode. Here are a few photos from our trip through the Maine & New Hampshire border area. Second down from the top is a 2011 photo of our ride.

Saw it, Liked it, Reposting it here...

I've mentioned before that I am a fan of Dr. Andrew Menaker's website and the blog there that he occasionally updates. I found him through the SMB Training Blog, of which I am also a big fan. At Mike Bellafiore's request, Dr. Menaker once addressed my question to the SMB Blog regarding overcoming bad trading habits.
I liked this blog post from April 13th...

http://www.andrewmenaker.com/something-you-need-to-know/

Something You Need to Know
April 13th, 2012 Leave a comment Go to comments
A trader with a superior trading strategy but lacking in self-management skills will generally underperform a trader who has a less than superior strategy (but still has en edge) and is superior in self-management. I see this all the time.
Consider re-directing some of your energy and time toward self-mgt. Self mgt. includes a lot of things….but the big one is understanding how your emotions – including subconscious emotions – influence your decisions and actions.
Your trading plan or your strategy must include self management.
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And from his April 17th blog post, he wrote this. It is as if he was peering into my mind when he wrote it. I am a knee-jerk reversion-to-the-mean trader. My first instinct is to wait for trend to end, then play for a reversal. In periods of high volatility, I tend to play for reversals which end up being "fades" because momentum keeps stocks trending for longer timeframes. That is to say, high vol sends stocks further from the mean than is customary and I play for reversal too early. My reversal plays are actually fades. This is precisely what happened a number of days last week. Fortunately, I have been working on my discipline and have been doing well engaging stops, which turn trend fades that would then become too much risk into stopouts. I spend an inordinate amount of time analyzing myself for the reasons why. I have to believe that with this constant high level of personal scrutiny, I will find a way to make proper trading decisions free from the clutches of anxiety or habit.
Until then, I remain a trader in training.

http://www.andrewmenaker.com/my-bold-prediction/

My Bold Prediction
April 17th, 2012 Leave a comment Go to comments
The prediction is that I’ll get a large number of emails by EOD and later tonight after traders survey the damage.
Yes, some things never change. Fighting a strong tape is a time honored tradition among many intra-day traders. Unfortunately.
A few reasons:
Many intra-day traders tend to have a short bias….you know, ‘elevator down and stairs up’…’make more faster on the down moves’.
The fading mind-set….or regression to the mean type thinking.
Probabilities. As someone who uses Market Profile and volume profiling, I’m well aware that the market tends to be rotational about 80% of the time, and makes directional moves about 20% of the time. The traders that cling to probabilities often do really well for a period of time…during rotational times…and when the directional day comes…BAM…all those rotational profits are gone in a heartbeat. This scenario plays itself out ALL the time. Especially when the market makes nice reversals such as today.
The moral of the story here is that one can not trade by probabilities alone. This is one of the reasons why I’ve been invited to speak at an institutional investing/trading conference in Japan in June.

Today, one practice trade so far

Here's my one trade today from earlier: 11:45am candle. I didn't follow my exit rules and got out on a false signal. The stock halted upward momo when it hit the 17 EMA so I got out. Starting with the next candle, WLT continued higher without me. I had anywhere from a 75 to 85 cent winner available to me if I had played it properly. Looks like I have to get back to my exit rules in order to combat my penchance for "cutting and running."

UPDATE: I performed just the one trade today.

Finally able to trade again

After taking Monday, Tuesday off from practice trading to focus on tax responsibilities as well as a personal day yesterday to spend with my sister, I am back at it today.

Here is my first trade entry and then exit. I decided to skip my rules of exit for the first half-hour today because of the high volatility. I exited at what I thought was a good spot. Nice gainer (+ 60 cents), but price kept going afterward. I could have had nearly double the winner had I stayed in. One really never knows with certainty where a stock will go...

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UPDATE: As I fix my typos on this post, the price is soaring. I could have had over twice my gain had I still been in as of this writing.