July 1st

After my day-job project, I was able to get into the market for a few trades starting at about 1:30pm. Got off to a rough start when a quick drop in ERX blew through my mental stop in a fraction of a second. I did get out but took a 13 cent loss on what was to be eight cents. After that, I didn't do too badly, although stock movement seemed to be quite muted this afternoon. I had a couple scratch trades mixed in today, which I take as a good sign that I am getting disciplined about stops and trying to keep those pesky losses to a minimum in choppy consolidation areas. There is definitely an art to playing these "quiet areas" which lay between trend moves. One other notable trade was STEC which showed up on the IB "Top Price Range" scanner. I got in, then it moved in my favor. I had about a 7 or 8 cent gain on it so I decided to dump it for a small winner and move on to other stocks. I clicked sell, then the candle popped just a fraction of a second later, I got filled for a 2.5 cent loss, then it moved right back to where it had been when I clicked sell. Now, I know it wasn't my order because my paper-trades don't fire into the market. What it does tell me is that I am making moves in patterns which others are also making. I've seen other examples of this. To me, that is a bad sign... it indicates herd thinking which is preyed upon by experienced traders. In the case of STEC noted above, I remembered that the stock was getting stale at the price level it was resting on as I clicked to exit. As a novice at this, it seems that other novices who were trading Real Money probably got "beaten up and their lunch money stolen" for making the same move. Do I know all this as fact? No, it is a supposition. I think it has a high degree of likelihood.

I had a number of chances to double up on a stock as it moved in my favor today. I didn't take all of those chances but did take two. One was a long trade on ERX for $29.68 at 2:23pm. Moving well, I took it long again for $29.76 thirteen minutes later. I scaled half out 4 cents higher for a $35 gain and then let the other run to $29.87 before taking the whole trade off. Total gain was $105. I got 68 % of that particular move. It was my best trade of the day... took more than 65% of the move, added to a winning position, and scaled out to get some quick profit while letting the original portion run.

Another notable trade was on ERX at 1:49 pm. I bought at $29.86 and waited 10 minutes to sell at $30.02. I captured 64% of the move; 16 cents of the 25 cents available.

So far, so good... the best part of this new approach is not taking large losses. And while I feel as though I have regressed in my training, I know it is for the best in the long run. It will take time to adapt but I am excited about the future...

-

8 for 13 winners. Success rate of 61% and a gain of $175 in 2.50 hours of paper-trading. Stops enforced on all trades and no adding to losing positions. Two scratch trades not counted here.