Saturday, June 27, 2015

Still Learning / Weekly Recap 6/22 - 6/25

This has been another week where I struggled with sticking to doing me.  When the market is slow I lose confidence in finding trades with my setups and I start experimenting and I get into trouble.  The reality is that all I need is 2 good days a week and I can make my weekly goal.  What I am looking for is $2000 to $2500 a week.  This is a fairly modest goal that can be realized by me remaining focused and taking advantage of my setups as they present themselves.  Obviously it is easier said than done.  When it's slow and it's taking forever for my setups to come I get bored and feel like I need to find trades to survive.  The only thing I am doing well is cutting losses quickly which is protecting my capital.  I still didn't hit my goal this week but had I not cut off the 5 or 6 trades I cut off early I would have easily made it.  I have to remain focused on my setups and maximizing their potential.

                               All Trades
Total Net Profit         $1,721.83
Gross Profit              $1,846.97
Gross Loss               $125.14
Profit Factor              14.76
Total Trades              18
Percent Profitable       83.33%
Winning Trades          15
Losing Trades             3

I do want to point out that I do not focus on $ amounts.  My P&L is hidden and I focus on the chart and my plan when in a trade; or at least I try to.  I try not to look at my P&L until after the trading day is done.  I think I will know if I have too many losing trades and it's time to stop for the day.

I reached out to Mike in DTW chat and he has helped me see what I am missing in analyzing the potential of a trade.  I trade a lot of weak moves but I need to be able to find the ones with the largest potential.  This should give me more confidence to let them work versus cutting them off too early. This is some of the advice he gave me:

"Trading a ticker just because a setup is there unfortunately won't yield profitable results. 

The best way to eliminate this problem is to only trade the stocks in play and keep an eye on them throughout the day. Stocks in play I define as having a catalyst for that particular day as well as valid trigger levels on the daily chart. If you abide by these simple criterion you will find your frequency of trading will drastically decrease and your potential for large winners will increase exponentially.  Hence, why you see me trade very infrequently but jump on the big movers when the opportunity presents itself. 

One thing to note is I never rely on any single indicator to determine my entry on a trade. However, I will use them all in conjunction to determine the direction of the imminent move. What I'm saying here is that I simply would not rely solely on the 9 EMA cross above Vwap for an entry. I personally prefer the price action to be above both the 9 and 20 EMA as well as the Vwap before entering. 

A great example was MBLY on Thursday. You can see the price action begin to curl back up and hold above the moving averages with a 5 minute candle close thru Vwap. All the indicators were pinching tightly together at the point making for a much stronger potential move up, and as you see it exploded quickly". 

This is a chart of another ticker I traded very poorly that shows me cutting off a winner for no apparent reason.  This would have given me what I needed to make my weekly goal. As a matter of fact if I had traded both of these tickers correctly I would have made my weekly goal in one day.  As you can see it had pretty much the same strong setup that MBLY had. Both were good VWAP trades before they broke the 15 minute opening range high that I like to trade.  I could have traded both off the VWAP with my stop on the VWAP and rode them both through the 15 min opening range high.  Both these tickers were gappers and were on my watch which means they were in play that day.

This was my best trade of the week from Monday.  I was on fire that day.  At first glance you could say I exited too early but my first profit target was the upper deviation band on the VWAP which at the time was 12.20.  It tapped it and as it came back I took the initial profit according to my plan. There was actually a secondary move that I missed.  Knowing what I know now I still would have taken profits but I would have looked to get back in.  When I start trading larger size my plan would be to take 1/2 off at the initial target and have the other still in for the next leg up.  If it is strong I could always add back in with my stop on all shares at the add price to protect profits.

I am determined to maximize the potential of the setups I trade.  I know there are short opportunities there as well so I will be studying my charts and Nate's DVD's to help me recognize those.  I will always be long biased and look for those first as I believe they help me identify shorting opportunities better.  I will keep studying and working on becoming a better trader.

Come check out the best chat.  Great for new traders.  Just click on "Take the Leap"


No comments:

Post a Comment