April 8th

This was a more comfortable day in front of the markets for me. Although I started off on the wrong foot with two losses on one cumulative position, I was pleased that I recognized it as a loser and bailed instead of riding it down as has often been the case for me. I then promptly reversed my direction and went short into the trend and made most of the loss back right away. Because I am paper-trading, the dollar amounts are moot. What is important is the training... and this trade was good training in what to do when the trade goes against you. The whole point is to keep yourself in the game; which requires protecting your principle. The rest of the day went quite well with just one other loss. With regard to winners, it was another day with escaping too soon after good entries at the head of nice moves. Notably, the final trade of the day where I took only 6.5 cents out of a 56 cent reversal in SKF at 2:12 pm; a mere 12% available to me! But, the fact is that I took a profit on the trade and I will not complain too loudly, lest I anger the market gods and be rewarded a massive loss the next time out for my insolence.
Two other bright spots in the day:
1. My conversation with Yngvai of http://welcometothegutter.blogspot.com/ regarding all things stocks. Thanks, James, for a great back and forth about this little world we choose to play in! It was a pleasure to talk shop with an afficianado.
2. Scott Farnham, the human trading machine, has opened up his blog Fear & Greed Day Trader to the public again, after a two-month hiatus. Copy everything you can as Scott's comment indicated that it may be available only temporarily. Hopefully he will keep it out there for us for a long time! Thanks Scott.

10 for 13 winners, a 77% win rate. 83 cents per-share gain.

Trader tax issues

As mentioned in an earlier post, above is Page 72 from IRS Publication 550. Here is the link to see the whole publication.

http://www.irs.gov/pub/irs-pdf/p550.pdf

btw, that's a picture of our 14 year old Lab Retriever, Elsie.

April 7th

Today was a lesson in patience and squandered opportunity while paper-trading the SKF. The greatest example of this was my multi-part position long in SKF; buy-ins were at 10:12, 10:22, 10:32, 10:32. This was a dollar-cost average to a price of $87.66 per share during the strong 21 minute, unbroken (3-min chart) drop in preparation for the reversal off this down move. This was the lesson in patience as my position was down significantly during this timeframe. But, I felt quite good about this play as the futures had been weak, the shorts have let up on SKF, and the big move down had to correct. Finally, with green showing in this position, I covered at 1:22 pm. At the time I clicked the mouse, I had about a 12 cent per share profit. When the transaction finished, I had actually lost 15 cents. I cut it too close, I guess... Now, the squandered opportunity: The run continued up short term to $88.26, what would have been a gain of roughly $2.40 cents per share. Had I held my position end of day, as I was prepared to do if the position hadn't come back to me, I would have cashed out a $ 9.36 per share gain. Oh well, that is all predicated on a perfect world scenario. At one point in the trade, I was down $8.00 per share but I can't figure out why I was unwilling to let it run with a gain more than 10 or 15 cents per share?! It's not something I was thinking about while the trade was on or at the point of sale. Looks like I have some mind-training to do on that! Add one more to the list.
There were a number of other exits too soon which cost me gains, but all in all, I'll take my "green" for the day in SKF plus a nice 55 cent profit on my one trade short in GS at 12:14 pm. That was as perfect a set-up as I could ask for! Again, I didn't follow through for all the $ available but I don't mind on that one.
Staying on the topic of positives, I can say I managed my losers well today. I had some bad entries but stayed patient and averaged out of them or cut just them off quickly, (except one, my 10:00 am short).
I am also working on figuring out if I can use my entry signals as exit signs. I am a long way from my goals, but I'll continue the journey because I have just enough success to keep coming back. Am I a sucker or what? :-)

10 for 17, a 59% win rate. $1.07 per share gain on SKF & GS