It was nice to spend the whole day in front of the markets, paper-trading the SKF and POT. A couple of bad decisions to not mind my stops caused me to slip back to my old habit of averaging in for a better price on losing positions. While all of them yielded winners, this really is a tough habit to break but one I must. The one loser was a POT short at 1:10 pm which I felt had a great likelihood to come into the money. It just felt like POT had run up so much for most of two days plus it started to show some weakness in relation to the indices when earlier it had been showing strength. It was tiring and poised for a breakdown. Unfortunately, I was about two hours early for the break and I let the trade go a bit tooo long before I shut it down. A loss of $381 is more than I like to take on a stop out. Interestingly, there was a clear sign that I should not have taken the trade at all but at the time, I was so focused that I did not see the forest for the trees. On the 3-minute chart at the 1:06 pm candle, there was a huge volume spike coupled with a good divergence from the mean... both my signals for reversal. But, I was so convinced that I KNEW what the stock was going to do that I didn't heed my signals... and I paid for it. I know to NEVER pre-judge a stock but I was so intense that I didn't take a step back and look at the big picture. Had I done so, I would have waited for the breakdown.
As is quite often the case, many of my winners today were cut short much too soon; gains in the thousands were left on the table. But, as I usually write, I am grateful for the winners! All are paper-trades and as such, make terrific learning opportunities. The education rolls on...
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8 for 9 winners, an 89% success rate. Gain of $1,443 in 6.5 hours of paper-trading.
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