Thursday, August 7, 2008

My Worse Day In A While

Like in about six months. I zigged when I should have zagged, I shorted wen I should have been long, and went long when I should have been short. I use tight stops so I didn't lose my house or anything, but it seems that every trade I made was an immediate mistake. It was the second time this week (I managed to make money thankfully the last time) when I wasn't where the volatility was and tried to superimpose my belief system on where a trade should go. Always a mistake, I know better and I write about it on this blog. "Trade what you see" didn't apply today. All my thinking was pretty right on, I just made a true mess of entries and exits. The action was to be short financials on any bounce today, no matter what, and I wasn't in that trade. I am a momentum guy that follows money flow in and out, what the hell was I thinking? Maybe because I had a great week and I'm feeling teflon? indestructible? Some of the greatest traders have lost after big wins ( no implication that I'm great). Maybe it's the DNA factor. I've talked to enough phenomenal traders over the years and they have opined the same thing. We have a tendency to let our guard down and lose the life or death attention to detail after a prolonged period of success.I pride myself on details. I make my money when I see a trend begin to fail or turn positive. Yesterday it was POT and MOS. I watched the chart like a hawk for four hours,saw the perfect set up and made a ton. Patience, it's all about patience, and NOT over trading which I did today. I love when I I trade 25,000 shares and have a big day. The losers are invariably when I trade 50-100,000 shares a day. When you have caught the right set up, you don't trade --you let it run!! What does that tell me? I'm over trading, pressing it, and taking it out on my buy/sell buttons., LOL It is kind of funny. So what now?

This evening I will look at my trading runs, EVERY trade. I will look at entries and exits and I will look at the chart to see where the stock was when I bought it. It will be depressing, a come to Jesus meeting if you will. A cleansing, hopefully--yea, I dig candles and the whole relaxation methodology. I have to or I would fry. Good for the soul. Try it. A little B. Dylan in the background.

For a guy that hasn't skipped a beat on being short financials forever, and even blogged yesterday that they HAD TO BE SOLD AGAIN, I have a fair amount of self loathing going on beacause I wasn't on top of the down move today. It truly breaks my heart.

When Springsteen was asked how he got up for the gig every night he said two things, " I play like it's my last night on earth--and two?" it's only rock n roll." A true balance. Peace, and I will catch ya later.


OE Trader said...

You had a few great weeks. Now, you're just a bit out of sync. If you review any trades/charts, focus on the positive ones. Better yet, just take tomorrow off and everything will become much clearer. Monday is a new week!

e.e said...

Here's some statistical data. While Fridays are down days 79% of the time, in 27 weeks this year, 10 Thursdays have been down days.
These down Thursdays have been followed by down Fridays 9 times (90%) in total, and 100% of the time when Thursdays have gone down more than 0.75%.
Past performance is no indication of future performance but percentage tennis works.

upsidetrader said...

thanks oe, always tomorrow pal-that's the beauty

upsidetrader said...


cool stat-trade what u see though-a lesson learned today

e.e said...

yes --I have taped on my keyboard "my opinion doesn't matter...the only thing that matters is price"
that being said I am short a few ES with a 2 point stop based on the stats... I usually take half off with a 1.5 move and then move the stop to BE on the whole trade so I have a "freebee" shot or a small loss.. either way I am cool with it. said...

Man, you just wrote my same day. Amazing, I have had some huge days the past couple of months only to get to confident and feel like I can do know wrong. Before you know it, I am down $30 grand for the day. Amazing how this game works, as much fun as it can be, it works on your nerves as well. Take care and get them tomorrow.

About Me

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I am a former hedge fund manager, broker and capital markets dude who now trades for his own account. I love what I do. I will try to post some stocks and an occasional chart that looks attractive for entry.I will also try to point out the idiocy of conventional wisdom and the lack of value added by the mainstream financial media. These postings should not be viewed as recommendations.