Today was an emotionally tough day for me. I felt I traded according to plan but kept getting screwed over. My first trade on ACRX – Why did i get scared out? Well I looked at the history of this ticker and every-time it gaped up, it ramped and ended green on the day. Because I wanted to avoid that risk I took it off pre-market. It did work in the end but I feel my decision had some base and I was actually proud of myself when I did it.
The next two trades were also losses. The first, I tried to take a short on this bouncer to play the opposite side as I saw it failing. Instead it hit support and ramped. I cut the loss and then I bought on a quick dip expecting a ramp up. When it did ramp, I did not sell as my target was a bigger move. This reminds me of the mistake I made the last time as well. Either ways, I had a hard look at my recent bottom bounce trades. They were far and few in between. My overall stats was poor as well – a 50% win rate with a slightly above >1 profit ratio. This would be ok if I had no commissions. The fact is that I do!
This leads me to the decision to retire my bottom bounce strategy. It sucks to retire this but it is something I have to force myself to do. I have to focus on the Top Reversals which seem to be gaining some traction for me. I am actually net positive on the month and have a 61% win rate with a 1.14 profit loss ratio till date. This tells me that I got to move into the direction that is working for me and forget LONG-ing for a while. It is super tough to let go of something that I put in almost a year of effort – refining it, collecting data and practicing my trading. I think my personality does not suit it.
Hence my final decision is to park this strategy aside for 3 months and focus on two things for the next 3 months. Consistency in my shorts and building up my size.
These bottom bouncers keep screwing me over. I do not see the early success I once had with this strategy. I will keep my size small on these guys.
Painful! I made two mistakes: I covered a little at 6 even though it was not according to plan and secondly I took profits way too early. This thing is trading at 5.13 as I speak!! Argh
This one was also painful in two ways. I missed my add! I had my trigger at 5.25 but it only hit a high of 5.2. Then I figured I get out because I did not want to be stuck in a mess if it turned just for a few cents. Should have waited though be this is at 4.1 now!
Tough lessons today but I will continue to persevere and grow. At least it was a green day. I do have to talk about the good thing that I managed to do – cut my size down after my 5 losing streak last week.
The bottom bounce! I was patient about my entry and actually got a decent fill. This thing then ripped to 13 without me. I decided to hold through the pullback. I had a good fill and really did not want to go for a small win. I knew these have the power to make a new high later. Unfortunately that never came and my 12.15 risk level broke. I got out with a scratch trade.
The untrained eye would say it was a bad day for me. Personally, I think I traded this well. The question about taking off into a pop has always been a hard one to answer. Other than that, I played right and I played according to plan. The best part is that I down sized today and it totally paid off. My loss was tiny.
VSTM – First trade today. Pulled off a small win as this stock really did not tank much. Tried to size in but got nothing really and was flat on the second add. This short strategy seems to be very forgiving in terms of accuracy. Played this well and correct and saw the bid stacking up so I exited.
ACAD – This beast was a mouthful. Felt like there was some level 2 manipulation as they held the stock up at 17.50 before it tanked significantly after some huge unloads. Took off some as it went along. This was another failed bounce play. Maybe the weakness of the markets are messing up my bounces. I was actually thinking of reversing my position as 17.20 broke, risking of the 17.4 mark. It is something I have been thinking about recently. To switch these bounces if they fail and try to take a short instead. It would have worked but I need to observe it a little more first. Stock is trading at 16.6 as I type this. Damn! No FOMO.
Conclusion: Overall a good day. I played confidently and well. I used intuition to remove ACAD because I seen this pattern many times before and it really did not seem to be working.
CNAT – Classic bottom bounce play that did not work. I had to size in fully and as you can see I traded this many times, adjusting my position and risk as it played out. Unfortunately, this beast got the better of me. I played this well and it was a good loss. I have two complains though. YES, I did size in a little too big, should have kept this loss 30 dollars less. Second was I could have definitely cut my loss a little bit earlier. I held and hoped for a second and that is costly.
HMNY – Played this sucker on the bounce. Did not chase this. I was proud of my entry and my patience on this. I took off only as the LOD broke and risked off pre-market support which became resistance. My little complain was that I tried to add around 3.03 but could not do so because I had realised my max loss on CNAT. Breaking rules are costly – If I had cut the loss a wee bit earlier, I probably would have made it under the max loss threshold.
Conclusion? – Keep your head up and trade another day. I am certainly down on the week but I got to keep to my rules and thing may work out. Let’s see.
Super tough trading this stock today as I could not get any size. This sucker was on a margin restriction. Otherwise I played this well. I believe one execution was not cool but the rest were swell. Played the pullback too.
PS: I skipped one day in the count because day 95 was the day after 94. It was a stupid boredom trade in which I lost 20.