$Debbie: Looking Forward To November

As a developing trader, it is important for me to look forward and have an updated list of things I need to keep in mind.

1. I will focus most on my “pet” stock JPM unless it becomes untradable (signified by really ugly unreadable charts in multiple time frames).

 

2. I will deviate from JPM only when there is obvious, trending order flow in AXP.

 

3. I will watch my two new stocks/sector (HIG, COP). I will only trade these when there is obvious, trending order flow with small share size to start.

 

4. I will test the mornings or afternoons with small share size with tight stops in an attempt to capture the bigger moves.

 

5. When I get the move (trade idea unfolds) then I will be more aggressive and if things line up hold it booking profits at significant levels leaving a piece to capture most of move and if things don’t line up then I will book most of position and hold a small piece at break even.

 

6. I need to make sure not to push when there is nothing to be had.

 

7. I need to make sure to “sit back” and allow opportunity to present itself to me.

 

 

Profitable Trading All!!

Debbie

 

$Debbie: What do I do when the pressure is on?

This was Debbie’s situation at the end of October.

Two  days left in the month, down by a little bit net and being net flat on month was in sight which had become my new weekly goal for ending October. Debbie’s psychology was strong and ready for the challenge.

One day left in month, down by a bigger number net and being net flat, with only one day left in the month, net flat on the month slid into the distance and was still in sight but very fuzzy. Debbie’s psychology was weakened and sprinkled with grains of defeat. Ended day with big headache.

The last day of the month, entered day with an “I will make money today when opportunity presents itself’ attitude. Ended up on day by best number yet, and down by very little net and being basically  alomost flat on month. I allowed myself to consider my goal of being flat on month achieved.  Ended day with big headache.

What did I do when the pressure was on?

1. I allowed myself to be angry and pout the night before the last day of month but by the end of night I made sure to shift my attitude from a pouty, negative one to a conquering, positive one. I had a headache due to the let down and stress.

2. I came into the last day of the month viewing it as a new day, one in which I would make money, and one in which when opportunity presented itself I would capitalize on it. I told myself “you know this, you can do this, you will do this”….be alert, be focused, pay attention, and the market will present something…you just have to see it”.  I ended the day with a headache due to intense focus on what I was doing.

3. The biggest thing……I did not give up and I did not just accept that my month was going to be a negative one. And more importantly, when I got to just barely flat on the month I booked the profit and took a position on sidelines and watched. I did not say that I had to get a few more cents to wipe out the measly , small net negative number.  I looked at the market, time of day, charts in front of me, and determined that it was just was not worth risking anything else. Afterall it was also the last day of the month.I allowed myself to consider my goal of net flat on month achieved. This is important to my psychology and confidence.

Profitable Trading All!!

Debbie

$Debbie: End of Month Reflections

October has been a strange month for me in my development as a developing professional trader. As I look through all of my notes that I take throught various trading days and at the start or end of each day, I see someone who has progressed tremendously (of which I am proud) and one who catipults from moments of confidence and knowing to moments of utter confusion and wondering if I know anything.

 

After much reflection, I have decided that part of this business is embracing those two conflicting moments and accepting that confidence and knowing what one knows will be juxtipositioned with a feeling of not knowing and a lack of confidence because in an everchanging environment (such as the market) one has to become very comfortable with sudden, quick, and sometimes drastic changes that can happen instataneously.

 

Part of embracing and accepting the juxtiposition mentioned here is the ability to immediately replace that feeling of not knowing and lack of confidence, when it arises, with a specific strategy to turn it back to knowing and being confident. There are three things that I have learned to say to myself and act upon to achieve this.

 

1. What is happening right now and has something changed?

2. Who has control right now? The answer is always me.

3. What are the if this then……that…scenarios I have in my toolbox that fit this situation.

 

Number 3 needs a bit of explanation. In my plan I have many if/then scenarios that I use at a seconds notice. A few are below:

 

1. If the tick does ________________then I will____________.

2. If the vix does ______________then I will ______________.

3. If one or more of my time frames show indications of a change of order flow then I will______.

4. If the SPY does__________________then I will______________.

 

 

The point is the more if/then scenarios one has the more control one has and ultimately the more confidence one will have.

 

 

Another thing that I have been reminded of this month is it is very important to test one’s trading idea, when set ups and signals arise, with small share size and tight stop loss perameters. On Friday, for example, I placed 6 trades and took several flats on positions and one small loss until my idea played out in a big way. I did this by doing the following:

 

1. I focused on my “pet” stock JPM which I know very well because it did an OR breakdown and followed through. Basically, it was doing what it should. Although I did deviate to another stock when it did not follow through I kicked it out and immediatly returned to JPM and then told myself I will not even look back.

 

2. I got into JPM a few times before I actually got the position I really wanted. I entered and re-entered several times. When doing this I took small gains and flats so that I managed risk.

 

3. When all things lined up (tick, vix, SPY, Price Action All Time Frames) I took, without hesitation, an aggressive position (now I wish I had been more aggressive but that’s another post).

 

4. I kept telling myself that as long as my criteria were being met then I was staying in the position. The only thing that I made sure of was to book enough profit early enough so that I would, at worst, be +2 on the trading day and my expenses would be covered. After that was achieved then I booked profit all the way down at significant support levels until I was holding my last piece (100 shares). That 100 shares I told myself I would hold until I was either stopped out (+5) or I could identify that conditiuons may be slowing or changing. With this 100 shares I was able to capture almost the entire move.

 

5. When I booked the profit on that last 100 shares, I called it a day. I have learned that lately, in the afternoons, when there is a good move in the morning or mid day, the market slows down and then price action in the stocks that moved with the market also slow down. I made a decision that I would not risk a cent trying to make a few more pennies.

 

Profitable Trading All!

Debbie

End of day recap October 27th

Sell Sell Sell $

How quickly things change in the world of trading! We have now sold off for 4 consecutive days on above average volume. Just a week and a half ago, it seemed like we would never have a down day again. Psychologically the SPY hit 110 and bounced off it like a brick wall. The US dollar has been trending up while gold is on the defense. GLD broke below the 20 ema yesterday and continues to retrace back towards the 50 EMA. The financial sector which has been Wall Street’s sweet heart since the lows in March was one of the weakest sectors today. Whether this is a turning point in the markets or just another pull back to get long remains to be seen. But one thing is for sure, it is healthy. The markets needed to take a breathe. If history has shown us anything, Greed is not good! Innocent people end up getting hurt!

With the SPY breaking below the 50 EMA today for the first time since July 15th, we need to be cautious with any longs, as there does not seem to be any support until $102.68. After 4 straight days of selling, we see some nibbling on the long side with a possible test at $107.

As always, you want to have scenarios (STOCKS) for both sides of the market.