An NYSE Scalper's Tale - A Trader's Diary

Friday, March 31, 2006

Trading Statistics For The Month Of March

Total Gross for Month of March: +$6,575.94
Total Net for Month of March: +$4,497.10
Total Fees (Gross - Net) for Month of March: $2,078.84

Total Trades for Month of March: 1,166

Total Shares Traded for Month of March: 1,972,648

Best Day for Month of March: Wed March 1, 2006 (+$742.41 net)
Worst Day for Month of March: Tue March 14, 2006 (-$477.25 net)

Number of Positive Net Days for Month of March: 18
Number of Negative Net Days for Month of March: 4
Number of Trading Days Missed for Month of March: 1

Top 3 Stocks For Month of March (Net Profit for March):
Walmart (WMT): +$1,028.60
Corning (GLW): +$797.99
Home Depot (HD): +$539.82

Bottom 3 Stocks for Month of March (Net Profit for March):
Bank of America (BAC): -$91.98
Disney (DIS): -$91.17
Electronic Data Systems (EDS): -$81.61

Top 3 Most Traded Stocks for Month of March:
Pfizer (PFE) - Traded on 19 out of 22 trading days
Walmart (WMT) - Traded on 14 out of 22 trading days
JP Morgan (JPM) - Traded on 13 out of 22 trading days

Bottom 3 Most Traded Stocks for Month of March:
(8 tied for last place - each traded on 1 out of 22 trading days)
Cendant Corp (CD)
Electronic Data Systems (EDS)
Motorola (MOT)
Merck (MRK)
North Fork Bankcorp (NFB)
AT&T (T)
US Bankcorp (USB)
Verizon (VZ)

Total Number of Different Stocks Traded for Month of March: 31

Stocks Traded During the Month of March (total net for March):
Advanced MircoDevices (AMD): +$79.33
Bank of America (BAC): -$91.98
Bell South (BLS): +$377.15
Bristol-Myers Squibb (BMY): +$35.41
Boston Scientific (BSX): -$11.45
Citigroup (C): +$349.36
Cendant (CD): +$35.17
Disney (DIS): -$91.17
Electronic Data Systems (EDS): -$81.61
EMC Corp (EMC): +$180.27
General Electric (GE): +$275.80
Corning (GLW): +$797.99
Home Depot (HD): +$539.82
Hewlett Packard (HPQ): +$66.40
Johnson & Johnson (JNJ): +$106.45
JP Morgan (JPM): +$287.63
Coca-Cola (KO): +$15.64
LSI Logic Corp (LSI): +$124.74
McDonalds (MCD): +$18.85
Motorola (MOT): +$58.39
Merck (MRK): +$34.46
Micron Tech (MU): -$59.99
North Fork Bankcorp (NFB): -$69.84
Pepsi (PEP): +$50.85
Pfizer (PFE): +$307.71
Sprint-Nextel (S): +$139.69
AT&T (T): -$10.10
Tyco (TYC): -$22.46
US Bancorp (USB): +$5.22
Verizon (VZ): +$33.81
Walmart (WMT): +$1,028.60

Monthly Recap
I had high expectations for March as there were 23 trading days during this month. This was also the month in which I was given an unlimited number of shares to trade with (I was previously given a limit of 4000 shares) and I really thought I could produce some big numbers.

Instead, I found myself having to re-adjust my trading strategy to incorporate the larger share sizes and I had to identify some bad habits I was starting to pick up when trading 5000 and 6000 shares.

Not only that, I basically had to re-learn a few things with regards to trading bigger share sizes (like which stocks could handle the size and how I could exit a large position without scaring a stock).

I also had to cope with a trading slump that occurred around mid-March in which I had 4 straight trading days that were either negative or less than $100 net. I missed one trading day to try to figure things out after this slump and it worked somewhat.

There were also far too many days in which I was positive, but less than $100 net (there were 5 days in which this occurred). Upon review, those days occurred because a lack of discipline and my disregard for the trading rules I had set-up.

Nonetheless, I feel I have learned a lot in March and I hope to continue to improve. In fact, I believe that this blog has had a lot to do with it. I was forced to look deeper into the issues I was having and by clearly identifying them in this blog, I was made more aware of the problems and I always made it a point to not to repeat the same mistakes on the following day.

Without this blog, I think I would probably try to forget what happened on the bad days and I would probably be more apt to repeat the same mistakes over and over again.

Some positive things that I noticed this month include:

1. The ratio of positive net days to negative net days remains fairly good (18:4) (though there is always room for improvement)

2. The worst stock traded this month was Bank of America (BAC), but I was glad to see that I lost less than $100; that compared to the best stock Walmart (WMT), in which I made over $1000

3. I am able to take more risks more comfortably and I seem willing to try trading new stocks - in the past, I mainly stuck to just a handful of stocks

4. I noticed that when I started having problems with a stock, I identified them and I avoided trading them

5. It was another month in which I really controlled my losses and it appears that this is the main feature of my trading strategy that I can rely on and follow (in other words, it's one of the rules I seldom break - unlike my other trading rules).

6. Out of the 31 different stocks I traded this month, 8 had a net monthly total that was negative (again there's always room for improvement)

And finally things that were not so good this month:

1. I needed to have the courage to hold on to positions longer

2. I have to learn to balance every aspect of a trade. At one point during the month, I focussed too much on share size and not enough on entry points. I compensated, but then I focussed too much on entry points and not enough on my exit strategy. Then I focussed too much on my exit strategy and not enough on proper share size!

3. I was surprised that revenge trading reared it's ugly head this month. In the past, I never really succumbed to it, but I think it was because of the larger share size which caused every losing trade to hurt much more than before

4. Overall lack of discipline on several of the trading days. From my trading journal, all the negative days and all the sub $100 days were all caused by a lack of discipline and my reckless abandon of my trading rules.

5. I have to learn how to trade! I'm talking about holding positions for half an hour or more to try to make 20-cents or more!

6. I have to try to step it up and be a little more riskier. I'll need to start doing more trades for 8,000 or 10,000 shares soon. That's right folks - it's time to separate the men from the boys...

Bring it on April!

A Ho-Hum Day

Gross: +$456.97
Net: +$377.73
Loss From Top: 0
Trades: 53
Shares Traded: 67560

Stocks Traded Today (net profit/loss):
Corning (GLW): +$118.99
General Electric (GE): +$101.89
Disney (DIS): +$47.64
Walmart (WMT): +$41.27
Bank of America (BAC): +$37.07
Home Depot (HD): +$30.84

Not much to say about today. It was another day with few opportunities and the overall market was fairly choppy. I was also able to avoid trading when I shouldn't trade and I found that when I was in a position, I often had to get out for 1-cent winners because of the choppiness.

The best trade today occurred shortly after the opening bell. When the market opened, I was watching General Electric (GE). Then at around 9:33AM, I tried to get long when GE broke the $34.75 resistance level, but I was not able to get shares. But then I saw another level at $34.80 and when it broke, I went long 4000 shares. Got out as follows: 2-cent winner (2000 shares), 3-cent winner (1000 shares), 4-cent winner (1000 shares) ($110 profit).

Aside from that trade, I took mostly 1-cent and 2-cent winners here and there.

Later I will post my statistics for the entire month of March...keep an eye out for it!

Thursday, March 30, 2006

What I'm Watching For Fri Mar 31, 2006

Aside from my usual stocks, tomorrow I'll be closely watching General Electric (GE). Today it was up on good volume and hit resistance at $34.75. The catalyst for today's move was that Morgan Stanley sees GE's stock price doubling within three years. If GE opens below $34.75 tomorrow, I'll watch for that resistance level to break. GE closed at $34.65.

Also today, Texas Instruments (TXN) gapped up after Nokia (NOK) lifted it's growth expectations for 2006. TXN is a major chip supplier to Nokia, hence the strong move up. We'll see where it goes tomorrow. TXN closed at $33.08.

Had Trouble Finding Opportunities Today...

Gross: +$401.50
Net: +$362.45
Loss From Top: 0
Trades: 25
Shares Traded: 33300

Stocks Traded Today (net profit/loss):
Home Depot (HD): +$274.81
Walmart (WMT): +$96.44
Corning (GLW): +$18.20

Today the morning was filled with wicked moves both to the upside and the downside. But once the afternoon rolled around, I felt like the market just chopped around without really going in any direction in particular.

It was another day of focussed discipline. I think the only downside to following my rules to the letter is that you'll get days when you see no opportunities to trade because the overall market has no trend. And today was no exception. Most of my trades occurred before noon and I only put on 2 trades during the entire afternoon.

The best trade today happened on Home Depot (HD) at 9:46AM. There was relatively good size on both the bid and ask (both sides had over 100 size). The Futures popped down so I went short. I got partially filled for 1700 shares and got the entire position out for a 6-cent winner ($102 profit).

When the overall market reversed at about 10:15AM, I couldn't spot any real good shorts...I ended up getting in and out fast because the downtrend was rather sloppy and the stocks I was watching moved down sloppily as well.

It was also another day in which all my trades came out winners and by following my rules, I kept myself out of many trades I would have put on (and lost money on). If only I could consistently impose this discpline on myself throughout the entire month....

Wednesday, March 29, 2006

What I'm Watching For Thu Mar 30, 2006

Boeing (BA) moved to new all-time highs during trading today after news that they scored an order from GE's aviation unit worth $4 billion at list prices. I used to trade a little of Boeing in the past - the only thing about this stock is that it's very thin. I may try my hand at trading this issue tomorrow. BA closed at $79.18.

Disney (DIS) had a big up day today. It had started downtrending a few days back, but today it popped back up and is now at it's 20-EMA. I couldn't find any particular news for the move so we'll see if it will bounce off it's 20-EMA or if it will push past it and continue it's earlier uptrend. DIS closed at $27.86.

Lastly I'll be watching Motorola (MOT). MOT has had trouble clearing the $22.50 level for a month and a half and has tried to test this level several times during that time. Well today it blew past that level and closed at $22.77. We'll see where it goes from here.

Making Money Shorting On An Up Day?

Gross: +$506.46
Net: +$439.37
Loss From Top: 0
Trades: 44
Shares Traded: 60810

Stocks Traded Today (net profit/loss):
Corning (GLW): +$331.91
Citigroup (C): +$85.83
Home Depot (HD): +$81.01
Verizon (VZ): +$33.81
General Electric (GE): -$7.21
JP Morgan (JPM): -$13.22
Pfizer (PFE): -$72.75

Today is how a day should look like if I stick to my rules and if I trade when I'm supposed to trade. Nothing really special about today - just fought really really hard to enforce some real discipline on myself today.

I think there was probably only one mental lapse that occurred today. Like the previous couple of days, I was up close to $300 by about 10AM, so I took the rest of the day easy and traded cautiously (with smaller number of shares).

From the totals, you can see I made some serious dough on Corning (GLW) today. First good trade on it happened at 10:01AM. At that time, GLW had just started downtrending when it reached the $27 level. The Futures had also just started to downtrend. Just then, the Futures started tanking, making new intraday lows. The $27 level was about to break so I tried to go short 4000 shares, but I only got 2100 shares. GLW then tanked really really hard so I took my profit as follows: 3-cent winner (500 shares), 10-cent winner (600 shares), 17-cent winner (1000 shares) ($245 profit).

Next good trade occurred on Home Depot (HD). At 2:03PM, HD came down to the $42.95 level. It had about 800 size on the bid and when it broke, I went short 4000 shares. Took my profit as follows: 1-cent winner (1000 shares), 2-cent winner (2000 shares), 4-cent winner (1000 shares) ($90 profit).

Last good trade happened again on Corning (GLW) at 3:40PM. At that time, there was a big buy order moving up on the bid (size of about 1000 kept moving up on the bid). GLW's price then stopped and started challenging the size and when the size broke, I went short 2000 shares. Got out as follows: 4-cent winner (1000 shares), 5-cent winner (700 shares), 6-cent winner (300 shares) ($93 profit).

One trade that I know I shouldn't have put on was on Pfizer (PFE). Once again, the Level 2 decieved me and I went short 6000 shares when I thought an important level was about to break when the Futures began tanking. Initially, it looked like a good trade - the size on the bid was drying up and just when I thought it would break, more size suddenly appeared on the bid. I quickly got out for a 1-cent loser for a $60 loss. Good thing I did get out when I did - PFE continued going up! Guess what - BACK ON THE BLACKLIST AGAIN PFIZER!!!

I noticed that all my big winners were all shorts. I know there were many times today I wanted to get long (and they would have been very profitable), but unfortunately I was not fast enough to get shares (there were at least 4 trades in which I was not fast enough to get long).

As I said earlier, I could have made more today if I had traded with my regular share size, but because the last few days I lost profits from the morning, I was more conservative than usual in the afternoon today.

Let's see what I can do during the last 2 days of March!

Tuesday, March 28, 2006

What I'm Watching for Wed Mar 29, 2006

Today it seemed like most of the retailers held up well despite the drop in the markets.

That being said, I'll keep watching both Walmart (WMT) and Home Depot (HD) tomorrow. Home Depot was the only Dow component that was not negative today. HD was well on it's way upwards and was pushing $43.50 before the overall market tanked. Hopefully this relative strength in the face of a falling market is a good sign. WMT closed at $47.75. HD closed at $42.99.

Well well well, a day after I blacklisted Pfizer (PFE), it catches my attention again. Today it rolled over and looks like it may start downtrending. After ranging between $26.00 and $26.50 for more than a month, it's a welcome change. PFE closed at $25.35.

Finally, I'm going to see if there are any opportunities on Tim Hortons (THI). Since it's IPO on Friday, it has been down the last two days. Let's see if it can catch some stability so I can start trading it. It's price range is just where I like it and hopefully more volume will pick up on the stock. THI closed at $26.48.

This Blog Should Be Renamed "The Undisciplined Trader"

Gross: +$116.68
Net: +$23.33
Loss From Top: 257.64
Trades: 63
Shares Traded: 76288

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$218.23
Home Depot (HD): +$82.14
General Electric (GE): +$39.21
Corning (GLW): -$12.41
JP Morgan (JPM): -$100.42
Citigroup (C): -$203.41

Wow! A lot of big traders had difficulty making money today. Even though the market blew a tire after the Fed announced the rate hike, very few traders seemed to be able to take advantage of it.

I usually like to compare my numbers with some other traders who post their numbers daily. The traders that post are usually very consistent and today it seemed like everyone had trouble.

If you'd like to take a look at their numbers as well, go to the EliteTrader site (see link on the right), and click on "Forums". Scroll down and click on "Journals". Finally, look for the thread "Trader P/L 2006". Make sure you go to the last page to see the most recent posts.

However, it is no excuse for the poor numbers again today. You can see from the "Loss From Top" that I made some money, but slowly lost it all.

The morning started off very good - I made close to $300 by 10AM, but throughout the rest of the day, I made several mental errors and put on many undisciplined trades.

The first few trades of the day were all good ones and all came on Walmart (WMT). First one at 9:36AM when I went short 3000 shares because there was size steadily coming down on the ask. I took profit as follows: 1-cent winner (600 shares), 2-cent winner (500 shares), 5-cent winner (900 shares), and 6-cent winner (1000 shares) ($106 profit).

At 9:52AM, there was large size on both the bid and ask on WMT, and when the bid broke, I went short 4000 shares. Took profit as follows: 3-cent winner (1400 shares), 4-cent winner (1300 shares), 5-cent winner (1300 shares) ($159 profit).

But after 10AM, I think I got a little too confident and bad trades came in a flurry.

At 10:14AM, I lost $85 on Citigroup (C) on 1700 shares, then at 10:29AM, I lost another $84 on JP Morgan (JPM) on 2000 shares. Then at 11:20AM, I lost money again on Citigroup (C) - this time I lost $102 on it.

After that trade on Citigroup (C), I decided not to trade it for the rest of the day. Upon looking at it's intraday chart, I noticed that whenever C started uptrending, there would be a big sell order that would push prices back down hard.

The last bad trade on the day happened on Walmart (WMT) at 1:25PM. That particular trade, I lost $122.

At that point, I waited until the Fed announcement. Of course it didn't come as a surprise when the Fed raised rates by a quarter point, but I think most traders didn't like what the Fed had to say.

At roughly 2:15, the market tanked badly. I couldn't really spot any good shorting opportunities because the market moved rather sloppily downwards. All the stocks I was watching were downtrending, but I found it difficult to find an entry point because prices were all over the place and the market kept looking like it was going to reverse.

Let me see if I can work on my discipline tomorrow...

Monday, March 27, 2006

What I'm Watching for Tues Mar 28, 2006

Tomorrow, I'm going focus only on 5 stocks. I have found that the last couple of trading days, I kept flipping to different stocks and never got a real "feel" for each particular stock. So here they are:

Citigroup (C) has a slow uptrend going and has support at $47.50 and a resistance at $48. The $48 level is starting to look important. Citigroup closed at $47.64

Corning (GLW) looks like it might be stuck in a range. Support for GLW is at $27 and has resistance at $28. If GLW can break $28, it can then challenge it's 52 week high of $28.28. Corning closed at $27.67.

JP Morgan (JPM) recently broke it's resistance level of $42 and managed to hold above it again today. JPM has a 52 week high of $42.43. It closed at $42.11.

Home Depot (HD) recently broke the $43 level and popped up a couple of days ago, but today it fell back down below it. We'll see if it can reclaim the $43 level and if it can make new 52-week highs (currently at $43.98). HD closed at $42.99.

Lastly, Walmart (WMT) is in an uptrend but has pulled back slightly. Let's see if it can continue upwards and if it can climb back above $48. Walmart closed at $47.95.

Couldn't Pull It Together

Gross: +$90.53
Net: -$47.53
Loss From Top: 226.66
Trades: 64
Shares Traded: 124800

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$218.82
Home Depot (HD): +$63.87
Corning (GLW): +$36.55
Advanced Micro Devices (AMD): -$15.32
Citigroup (C): -$38.17
Bell South (BLS): -$150.65
Pfizer (PFE): -$162.63

Today I tried to stick to the game plan by keeping my share size consistent - and I did stick to it, but it was the other parts of the game plan the fell apart and resulted in a negative day for me.

I've got to stop trading stupid stocks that hardly move like Bell South (BLS) and Pfizer (PFE). I am constantly getting tempted by what I see on the Level 2 on these stocks and I end up trading them. I'm temporarily putting these two stocks on my "Do Not Trade" list - at least until they start trending and or when their intraday ranges pick up.

The thing that killed me today was Bell South (BLS). All day I was watching and waiting for the $35 level break. I was caught a couple of times on false breaks, and it slowly chipped away on my net.

I've also got to stay away from Pfizer (PFE) for the next little while. The Level 2 on this stock is soo deceiving and it's been fairly tricky to trade lately. Today on PFE I put on some good trades on it, but it was usually followed up by an even worse trade on it.

Revenge trading also got the best of me today. After a good start to the morning, my profits slowly decayed into negative territory, I started trading angrily by trading 5000 or 6000 shares without thinking things through.

I hate bringing this up time and time again, but the market chop also got the best of me. I know I keep using this excuse whenever I have a bad day, so this is what I intend to do: instead of blaming market "choppiness", I think I should focus on when I should trade and when not to trade. If I keep blaming market "chop", I will never be able to identify the problem I am having.

I have to keep changing things up to try to get consistent. I can understand having a bad day or two, but if I keep having good days followed by mediocre days followed by bad days then back to good days, it means I am doing something wrong. And the thing I keep doing wrong is that I keep breaking away from my trading plan.

So I propose the following: anytime I put on two bad trades in a row, I will force myself to read my trading strategy. By following this exercise, I hope to enforce the rules I have setup for myself.

4 more days to go...

Sunday, March 26, 2006

What I'm Watching for Mon Mar 27, 2006

There's not much to watch on the news front, so I will be watching some important levels for certain stocks on Monday.

First one is on Bell South (BLS). BLS is near 52 week highs and since the beginning of March, it has been trying to get to the $35 level (and almost got there on Friday). I'll be watching for the $35 level to break and we'll see if it can make new 52 week highs from there. Bell South closed at $34.89.

The next one is on Citigroup (C). For two days now, C has tried to break the $48 level without success. I'll be looking to get long if the $48 level breaks. Citigroup closed at $47.81.

The last one is on Bank of America (BAC). For the last 6 trading days, BAC has tried to break and close above the $47 level. On Friday, it tried to break $47 late in the day (and I almost went long), but did not succeed. Bank of America closed at $46.90.

Another Very Quiet Day (Fri Mar 24 Results)

Gross: +$190.12
Net: +$140.34
Loss From Top: 54.90
Trades: 42
Shares Traded: 46000

Stocks Traded Today (net profit/loss):
General Electric (GE): +$73.08
Corning (GLW): +$71.80
JP Morgan (JPM): +$25.11
Citigroup (C): +$22.14
Disney (DIS): +$15.63
Bristol-Myers (BMY): +$12.35
Walmart (WMT): -$1.50
Home Depot (HD): -$16.72
Pfizer (PFE): -$61.56

Yet another day with very little action on my part. Friday I had difficulties spotting opportunities and those that I did spot, I was either too slow or I got partially filled.

No good trades nor any bad trades to report for Friday. Again, I was using too few shares on many of my trades.

I have the feeling that it's becoming a little more difficult to be consistent the last little while. I think a number of things are the cause of this. I think that larger share size is again playing pyschological games with me - everytime I'm in a position with large share size, I get very anxious and feel a great need to get out of it as soon as possible.

Also, larger share size has caused me to constantly change my trading strategy. At times when I don't feel comfortable, I trade with smaller size - other times when I feel fairly confident, I again change my share size to a larger one.

And so, since my trading strategy keeps varying from moment to moment, I find my self having inconsistent trading results. On days (such as Friday), the totals are fairly low, probably because I was trading defensively and conservatively (with smaller share size and not according to my regular trading strategy).

During this final week of March, I'm going to stick to my game plan and trade with consistency...share sizes will depend on the "thickness" of the stock and on the support behind my trade. I'm also going to focus on executing my exit strategy this week as well.

Let's see what this last week of March brings us, shall we?

Thursday, March 23, 2006

What I'm Watching for Fri Mar 24, 2006

For the last 3 or so days, I've been keeping a close eye on Walmart (WMT). It has shown strength and there has been lots of buying lately and today was no different. I'll be definitely be watching if Walmart tries to test the $50 level. Walmart closed at $48.54.

Remember a couple of weeks ago I mentioned how Home Depot (HD) had difficulty closing above the $43 level? Well yesterday it finally managed this feat and today it continued to shoot up and almost make it to it's 52 week high of $43.98. The next level to watch on HD is the $44. Home Depot closed at $43.81.

Yesterday I watched JP Morgan (JPM) and all day it showed strength. It had a good run up and made new 52 week highs and during the last half hour on Wednesday, there was crazy buying. Today trade on JPM was lackluster so we'll see if today was just a resting day before it continues up. JPM closed at $42.04.

Lastly (just out of curiosity) I'm going to watch how Tim Horton's (THI) will trade tomorrow. This one is one of the most highly anticipated IPOs. THI begins trading tomorrow.

I'm All Green

Gross: +$480.29
Net: +$432.59
Loss From Top: 0
Trades: 32
Shares Traded: 40000

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$162.15
Citigroup (C): +$153.43
Johnson & Johnson (JNJ): +$76.20
Pfizer (PFE): +$32.78
Hewlett Packard (HPQ): +$8.01

I'm not too sure why, but today I traded in an ultra conservative way. All my trades today were for 2000 shares or less (except for one trade for 5000 shares). I was also very picky today about which trades to put on (hence the low trade total and the low number of shares traded).

Every trade today was a positive one - which I'm happy about...just wished I used more shares. I was also very patient with most of my trades to try to ride winners. I made it a point to refrain from exiting when I really felt the need to get out of the position. The result was that I was able to take several more cents out of the trade than normal. I also tried to force myself to scale out of my position (when I would normally exit my entire position), which helped me capture a little more profit.

Since I was using smaller share sizes (2000 or less), there were no really good trades today. And as mentioned earlier, all my trades today were positive.

I'm going to start posting what I'll be watching in the evenings again. This time I'll title them "What I'm Watching Tomorrow". Why am I going to be doing this again? I'm not sure if all of you have heard, but Google started it's own finance site a few days ago (currently in beta). It can be found here:

I really like the interactive stock charts and I really suggest you take a look for yourself. Simply type in the stock symbol at the Google prompt at the top of the page and it will give you all information about the stock including the interactive stock chart.

An interesting element is that near the bottom, it has links to blogs that may have relevant information about that particular stock.

My blog appeared a few times when I input certain stock symbols, and so in an attempt to drive more web traffic to my site, I am going to start posting in the evenings again. Stay tuned....

Wednesday, March 22, 2006

A Frustratingly Difficult Day

Gross: +$283.90
Net: +$106.63
Loss From Top: 165.16
Trades: 78
Shares Traded: 159600

Stocks Traded Today (net profit/loss):
JP Morgan (JPM): +$185.09
Home Depot (HD): +$50.87
Bristol Myers (BMY): +$23.06
Citigroup (C): +$18.64
Walmart (WMT): +$12.09
Hewlett Packard (HPQ): -$8.25
Pfizer (PFE): -$80.50
Micron Tech (MU): -$94.38

Several mental mistakes were made today, causing my net profit to fluctuate all day long. The day was full of events - missed opportunities, whippy price action, couple of good swings, some revenge trading, and full of big losing and winning trades. Near the end of the day, I smartened up and managed to get back into positive territory after sinking to negative territory for most of the afternoon.

This morning I got off to a quick start and within the first hour and a half of trading I was up close to $300. Then it happened....a bad trade.....and from that point on, I started dying a slow and agonizing death and proceeded to slowly lose $400. I then took a break, cleared my mind and managed to climb back out of negative territory.

At some point during the afternoon shortly after a bad trade, I started trading with an "I don't care" attitude (where I get into a position without a real reason for entering, then not caring when the position goes against you). If you ever find yourself in a similar situation - take a break! This kind of attitude is extremely DANGEROUS and is a form of revenge trading. I caught myself doing this late in the afternoon and got myself to snap out of it.

Some good trades include one on Citigroup (C) where I went long 3000 shares at 10:17AM and got out as follows: 2-cent winner (200 shares), 3-cent winner (1000 shares), 4-cent winner (1800 shares) ($106 profit before fees).

Another one on Hewlett Packard (HPQ) when I went long 5000 shares at 11:07AM and got out as follows: 1-cent winner (1600 shares), 2-cent winner (2000 shares), 3-cent winner (1400 shares) ($98 profit before fees).

And a quick profit on Pfizer (PFE) at 2:52PM when I went long 5000 shares for a 2-cent winner ($100 profit before fees).

However, there were just as many bad trades as there were good. PFE took me for a 2-cent loser on 5000 shares for a $100 loss.

HPQ also took me for a big loss on 4000 shares for a $112 loss.

As you can see, I traded a lot today with a lot of shares. I guess it was mostly out of frustration and as I mentioned, at one point I was trading angry and was randomly getting into trades with 5000 shares.

Let's hope for better luck tomorrow...

Tuesday, March 21, 2006

The Market Moves!

Gross: +$489.98
Net: +$414.50
Loss From Top: 0
Trades: 52
Shares Traded: 76000

Stocks Traded Today (net profit/loss):
Pfizer (PFE): +$242.38
Corning (GLW): +$211.50
Cendant Corp (CD): +$35.13
Citigroup (C): +$28.18
Hewlett Packard (HPQ): -$8.22
Bell South (BLS): -$10.15
Boston Scientific (BSX): -$24.88
Walmart (WMT): -$59.43

After a couple of days of trading in a tight range, I'm glad that today the markets actually moved! There was some nice intraday swings both to the upside and the downside. I only wished I was fast enough to catch more of it!

Today I also tried a few new things to try to tweak my trading strategy when it's choppy. It was met with limited success, but then again, the market moved with some nice trends for most of the day before I could fully test them out.

There were two good trades that stood out today.

The first good trade occurred on Corning (GLW). After a quick start in the morning, GLW topped out at around 10AM and started to fall. Then at 10:17AM, GLW came down to the $28 level where there was mild support (maybe about 200 size on the bid). When GLW hit the $28 level, it paused for a bit, but then the Futures tanked (and it tanked hard!). I went short 2000 shares at $28 and took my profit as follows: 6-cent winner (500 shares), 9-cent winner (500 shares), 13-cent winner (500 shares), 15-cent winner (500 shares) ($215 profit before fees).

The next good trade occurred at 10:49AM on Pfizer (PFE). At that particular time, the Futures had just turned downwards and PFE had just finished popping up. The Futures then popped downwards, so I went short 5000 shares. I got out of my position as follows: 1-cent winner (2000 shares), 4-cent winner (3000 shares) ($140 profit before fees).

After two days with little to no action, I'm glad we had a day like this. However I felt as though I should have done better than this. There were a couple of trades I got into that did not move even though the Futures moved strongly in the direction of the trade.

Monday, March 20, 2006

Flatline Monday

Gross: +$168.35
Net: +$76.32
Loss From Top: 38.14
Trades: 45
Shares Traded: 83670

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$210.97
Sprint-Nextel (S): +$3.38
Bell South (BLS): -$13.08
Pfizer (PFE): -$15.00
Johnson & Johnson (JNJ): -$15.60
Hewlett Packard (HPQ): -$22.83
Micron Tech (MU): -$71.50

Yet another choppy day without any real direction. Everything I was getting into chopped back and forth and shook me out of many of my positions. The only thing I was able to see was the strength in Walmart (WMT). Other than that, the other stocks I was watching gained (or lost) very little ground today.

The market in general was extremely choppy and was stuck in a fairly tight range and as a result, I did not see many opportunities today. Nonetheless, I probably overtraded today (and probably lost more money than I should have).

Today was the second day Walmart (WMT) moved up strongly on good volume. I'm going to keep WMT on my trading radar tomorrow. I caught a couple of good swings in WMT but nothing too spectacular - I probably got out of WMT a little to early on several of my trades because the market chop kept scaring me out of my position.

Again, another day without any good or any really bad trades. I've noticed that we are encountering more and more tight ranged choppy days. I'll probably have to adjust and trade slightly differently under these kinds of circumstances.

Other than that, I was almost bored to death waiting for things to happen. I had to hold back several times from trading as there were plenty of fake-outs. Let's hope the market starts moving tomorrow...

Sunday, March 19, 2006

I Hate Witching Days (Fri Mar 17 Results)

Gross: +$136.99
Net: +$45.06
Loss From Top: 51.62
Trades: 50
Shares Traded: 87794

Stocks Traded Today (net profit/loss):
Citigroup (C): +$95.80
LSI Logic Corp (LSI): +$67.82
Walmart (WMT): +$43.55
Pfizer (PFE): +$39.94
Sprint-Nextel (S): -$42.33
JP Morgan (JPM): -$60.54
Micron Tech (MU): -$99.18

Historically I have done poorly on witching days (when options on stocks expire - occurs every 3rd Friday of every month). It was bad enough that on Friday it was a quadruple witching day (options expire for stocks, futures, stock index, and single stock futures), I also had to put up with a market that had no real direction in mind.

All day, I couldn't get anything going; add in lots of choppiness, and you get what I got today. Right from the start of the day, most of the stocks I was watching were all over the place and on witching days, many stocks have a mind of their own. I was able to catch a few good swings during the day, but they were short-lived and I ended up giving back some of the gains I made because of the market chop.

No really good trades nor any real bad trades on Friday. Just had to get in and out fast and I often had profits from several small winners taken out by a losing trade. All in all, I would have to say it was a fairly boring day.

I have been contemplating whether I should just take witching days off, but I'll see how next month's witching day turns out before I make a decision...

Thursday, March 16, 2006

Back To Basics

Gross: +$620.80
Net: +$515.77
Loss From Top: 0
Trades: 76
Shares Traded: 94600

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$289.64
Citigroup (C): +$161.69
LSI Logic Corp (LSI): +$56.92
Pfizer (PFE): +$35.17
Bank of America (BAC): +$16.87
US Bancorp (USB): +$5.22
Sprint-Nextel (S): +$4.46
McDonald's (MCD): -$16.12
The Williams Companies (WMB): -$13.06
Coca-Cola (KO) : -$25.25

I apologize for not posting my results on Tuesday March 14. For the past week or so, Blogger seems to keep going down and I was unable to login and post my results. I tried twice that night, but afterwards that I was in no mood to reflect upon what happened that day. You see, Tuesday was my 2nd worst trading day ever (I lost $477) and so I took yesterday (Wednesday) off to review my trading journal and to review my trading strategy.

Did you folks out there catch what I was doing wrong? Did you notice that when I started talking about trading larger share sizes that my performance suffered? After a day of reflection, this is what I could gather went wrong from my trading journal:
  • I found that I was trading when not all of my trading criteria were met; I did this because of my larger share size - I was thinking "Gee, well some (but not all) of my trading criteria are met and right now I could go long (or short) 6000 shares...I better put on a trade now while it is still possible to get that many shares"
  • Also the last few days I was too obsessed with trying to make $1000 (which I thought was now easier, since I was trading larger share size), I ended up taking too much risk in certain trades and I was expecting to hit a home run on every trade
  • A combination of the above points led me to do a lot of "revenge" trades (where you try to get back at a stock for making you lose money by trading wrecklessly or by trading even larger number of shares to try to make back what you lost); this is what caused me to blow up on Tuesday when I went long 10,000 shares of MU (because I was pissed off at MU for making me lose money!) - that specific trade lost me almost $300!
So today I went back to basics and went back to trading like I was before. I traded smaller sizes (4000 shares max.) and I made sure that trends were present before getting into trades. My update and review of my trading strategies also helped tremendously - I would recommend you do this at least once a month (though everyday would be better!).

Since I'm using smaller share sizes, I'll have to re-define what a good trade and a bad trade is. I'll consider a profit of $100 or more a good trade. A loser of $100 or more will be considered a bad trade.

On that note, there are a couple of good trades that occurred today. As you can see, the bulk of my profits came off Walmart (WMT). Today WMT was on fire! Lots of buying in this stock went on today and I was able to take advantage of it a couple of times.

I hadn't bothered to look at WMT until roughly 11:30AM when I noticed that WMT was trending strongly. At 11:39AM, WMT approached the $46 level and when it broke I went long 4000 shares. It seemed to have trouble going up much further so I got out of my trade as follows: 3-cent winner (3000 shares), 7-cent winner (1000 shares) ($160 profit before fees).

Later in the day at around 2:10PM, I saw a lot of buying going on in WMT and every level of resistance just melted away. So I went long 3000 shares and got out as follows: 1-cent winner (1000 shares), 2-cent winner (1000 shares), 10-cent winner (1000 shares) ($130 profit before fees).

Also put on some good trades on Citigroup (C). At 12:36PM, there was some size on the ask and all of a sudden, a huge order appeared on the bid (2000 size suddenly showed up!) - I quickly went long 3000 shares and prices popped up quickly - I took my profit as follows: 4-cent winner (1600 shares), 5-cent winner (1400 shares) ($134 profit before fees). The big order then disappeared.

Shortly afterwards, it happened again on C (the 2000 size shows up on the bid again!), this time at 12:40PM. I went long 4000 shares this time and took my profit as follows: 1-cent winner (1000 shares), 2-cent winner (2000 shares), 4-cent winner (1000 shares) ($90 profit before fees).

Today could have been bad for me today (as it appears to be a little choppy), but after a day of review and going back to basics, I would have to say that I'm happy that I was in the green today.

Not too sure if it should worry me, but I noticed that the number of trades today was a little high. Oh well, I hope I have a repeat performance tomorrow...

Monday, March 13, 2006

I Got "Chop"ed to Pieces!

Gross: -$110.45
Net: -$284.88
Loss From Top: 284.88
Trades: 76
Shares Traded: 172614

Stocks Traded Today (net profit/loss):
General Electric (GE): +$57.25
Coca-Cola (KO): +$40.89
Pfizer (PFE): +$4.29
Sprint-Nextel (S): +$1.06
Hewlett Packard (HPQ): -$39.27
Bell South (BLS): -$53.69
Disney (DIS): -$77.49
Electronic Data Systems (EDS): -$81.61
Bank of America (BAC): -$135.29

My trading slump continues...For several weeks now, the markets have been very choppy and I am constantly finding that my trading strategy just doesn't work very well in such conditions. I hope the overall market can break out of this trading range and start moving in a definite direction soon.

This morning, I think I was a little too aggressive and by 10:30AM, I was already down almost $400. At that point, I took a little break and I tried to figure out what I was doing wrong for the past couple days. I came to the conclusion that the last little while, the market has been fairly choppy and I was holding positions a little too long (in the hopes they would move more in my favor) and so I decided that I should be taking small winners when I can get them.

Also, the last few posts I've been stressing patience in holding winners and I still stand by what I wrote, but only when the markets are trending! I've been making the mistake of holding positions too long when the markets are trendless and/or choppy.

You see, what was happening was that every time I got into a position, I would watch it go 1 or 2-cents in my favor, but I wouldn't get out, hoping for more profit. What would happen is that because the Futures (or market) was so choppy (would pop up, then pop back down; later it would burst downwards, but would immediately pop back up), my trades would move initially in my favor, but would reverse and I end up getting out for a 1 or 2-cent loser.

I've also recently started trading larger share sizes (5000 or 6000 shares at a time), which in a choppy market, may cause difficulty, especially if I have to get out of a position as soon as possible. Today is my all-time record for the number of shares traded today and I probably overtraded today. Again, when trading big size, a small loser ends up looking big.

For the rest of the day after 10:30AM, I started taking small winners here and there, but a bad trade on Disney (DIS) set me back a little and I could not recover.

The bad trade on Disney (DIS) occurred at around 2:02PM. There was massive resistance at the $28.50 level (close to 5000 size on the ask). I thought the level was going to break when the Futures popped up, so I tried to get long 5000 shares at $28.50. I got partially filled for 3400 shares and I cancelled the balance of the order when it looked clear that the level was not going to break. In a true market chop fashion, as soon as the Futures popped up, it popped back down again and before I could blink, DIS went against me a few cents. I got out for a 4-cent loser ($136 loser before fees).

So this is what I'm going to do when I trade tomorrow:
  • if the market is choppy, I'll get in and get out quickly (taking 1 or 2-cent winners); I'll continue to do this until the market decides which way it wants to go
  • in the mornings, I'll trade a light number of shares (maybe 2000 or 3000 shares) as a kind of "warm up" to the trading day
  • I'm also going to temporarily reduce the number of shares I trade (4000 or 5000 shares max); at least if I do get "chop"ed to pieces again, I will not have lost as much money
  • I've also noticed that I am starting to ignore some of my trading rules; I think this stems from the fact I'm trying to trade a large # of shares and anytime I see a stock that is capable of handling my order size, I trade it recklessly - I'm going to focus and make myself more aware of when I should and should not trade
If I cannot break out of this trading "funk" tomorrow, I will take Wednesday off to update and review my trading strategy. I usually do this at the beginning of every month, however I have not had the time to do it yet for this month. I will obviously have to add strategies for when the markets chop around like it has the last few weeks.

Sunday, March 12, 2006

Is That All I Can Muster? (Fri Mar 10 Results)

Gross: +$180.00
Net: +$76.86
Loss From Top: 99.65
Trades: 53
Shares Traded: 109400

Stocks Traded Today (net profit/loss):
Micron Tech (MU): +$100.04
Pfizer (PFE): +$51.55
EMC Corp (EMC): +$22.62
JP Morgan (JPM): -$3.16
Bank of America (BAC): -$9.63
AT&T (T): -$10.10
Bell South (BLS): -$36.57
Sprint-Nextell (S): -$37.88

I will never ever trade EMC Corp (EMC) ever again! On a day when traders out there should be raking it in (on such a big up day), I ended the day with a pathetic showing.

On Friday morning, just before the market moved up big, I had a choice of either going long on Micron Tech (MU) or EMC Corp (EMC). I ended up going long 5000 shares on EMC and I was thrilled that the markets continued to push up. But what happened? EMC hardly budged at all! The S&P Futures ripped up at least 4 handles (16 ticks), but EMC only moved up 1-cent! I held that stupid EMC position for what seemed like the longest time, but still it did not budge. I ended up taking a 1-cent winner on it.

Had I gone long 5000 shares on MU instead of EMC, I could have made 20-cents or more on the trade (that's $1000 or more!). This is exactly the reason I refuse to trade Time Warner (TWX) any more because it too usually doesn't move much (because it's too thick!). Looks like I'll be adding another stock to my "Do Not Trade" list...

Of course, after the huge morning move up, the rest of the day was rather trendless and I couldn't get anything going the rest of the day.

There were no good trades nor any bad trades on Friday (though there SHOULD have been a good trade in the morning).

After a relaxing weekend, I look forward to the coming trading week....

Thursday, March 09, 2006

I Woke Up This Morning For This?

Gross: -$88.92
Net: -$177.97
Loss From Top: 183.11
Trades: 53
Shares Traded: 101308

Stocks Traded Today (net profit/loss):
Corning (GLW): +$56.68
Pepsi (PEP): +$49.64
Pfizer (PFE): +$43.80
Bell South (BLS): +$25.75
Micron Tech (MU): +$14.81
Sprint-Nextell (S): -$17.61
Boston Scientific (BSX): -$23.81
Walmart (WMT): -$52.61
Johnson & Johnson (JNJ): -$4.23
Hewlett Packard (HPQ): -$121.26
JP Morgan (JPM): -$148.80

Talk about a slow day! The morning was stuck in a very tight range and in the afternoon the market moved without much conviction. Today I just couldn't get anything going. All the stocks I was watching were wandering around like lost children at an amusement park.

Even though there was a slight downtrend in the overall markets today, the trend was too slow and stocks simply meandered around and seemed not to notice. Almost every trade I got into today would go nowhere. And even if I was in a trade and the overall market (Futures) suddenly burst in my favor, the stocks I was in would go the opposite direction!

Oh well - negative days are bound to happen. Just like trades themselves, you cannot expect to have a winning day (or trade) all the time. Just as long as the losing days are not as big as the winning days and hopefully occur less frequently than winning days. But still, a very frustrating (and I must say, very boring) day.

There were no good trades for me today (nothing seemed to move in my favor!).

But JP Morgan (JPM) put me in the red early in the morning and I would not see green for the rest of the day. This trade shouldn't have been put on because the markets were trendless and were trading in a very tight range. But at 10:41AM, JPM kept testing some resistance at $41.61. There was about 800 size on the ask and when it did break, I went long and got partially filled for 2900 shares at $41.61. But since there was no overall trend in both JPM and the Futures, prices just seemed to hang around for a bit. Then all of a sudden, prices just jumped 5-cents against me. I got out my 2900 shares for a 5-cent loser ($145 loser before fees).

I just have to remember when I should and should not trade. Hopefully I can get back in gear tomorrow...

Wednesday, March 08, 2006

Wanted: Patience

Gross: +$764.10
Net: +$676.76
Loss From Top: 0
Trades: 43
Shares Traded: 88310

Stocks Traded Today (net profit/loss):
Bell South (BLS): +$304.74
Micron Tech (MU): +$153.61
Hewlett Packard (HPQ): +$139.79
Sprint-Nextell (S): +$105.67
Pfizer (PFE): +$21.93
Boston Scientific (BSX): -$48.99

Does anyone out there have some patience that they would like to borrow to me? Today should have been a $1000+ day, but because I'm lacking that key ingredient, today's numbers were the result.

Aside from big losing trades, the thing that gets me really upset is when a good trade is cut short because of my impatience. I end up taking a 1 or 2-cent winner when it could have been a 10-cent winner (or more).

Today there was a trade on Micron Tech (MU) - I had 4000 shares long, got out for a 2-cent winner, could have been a 10-cent winner (missed out on $320 profit).

Then there was a trade on Bell South (BLS) - I had 2600 shares long, got out for a 1-cent winner (400 shares) and 3-cent winner (2200 shares); this trade could have been at least a 10-cent winner (missed out on $190 profit). I also missed out on another $800 (see below for the trade of the day).

On Hewlett Packard (HPQ) I was long 5000 shares, got out for an $80 profit (1-cent winner on 4000 shares, 4-cent winner on 1000 shares), but it could have been easily a $500 profit (missed out on $420).

There are many aspects to trading and obviously this is one of the ones I have to really work on. We'll see if we can work on that in the next few days.

One good trade to tell you about today. Occurred on Bell South (BLS). All morning, BLS was downtrending. Then at 11:02AM, BLS reached some support at $33.75 (I think there was maybe 400 size on the bid). Anyways, the Futures tanked hard so I went short 4000 shares at $33.75. Got out of the trade as follows: 1-cent winner (1000 shares), 7-cent winner (1000 shares), 8-cent winner (1000 shares), 9-cent winner (1000 shares) ($250 profit before fees). Again, my impatience caused me to get out of this good trade too early. After I got out, I watched in horror as BLS continued falling another 20 or so cents (missed out on $800 profit!!!!).

Honestly, there was no real good reason for me to have gotten out of BLS when I did - the Futures were continuing down and there were a lot of eager sellers (lots of big sell orders on the way down). Again - this is something I'll work on.

No bad trades today. Hopefully I can keep this habit going...

Tuesday, March 07, 2006

Trading Blind

Gross: +$264.64
Net: +$171.55
Loss From Top: 60.33
Trades: 51
Shares Traded: 95120

Stocks Traded Today (net profit/loss):
Sprint-Nextel (S): +$122.73
JP Morgan (JPM): +$63.29
Hewlett Packard (HPQ): +$50.14
Merck (MRK): +$34.46
EMC Corp (EMC): +$29.80
Disney (DIS): +$1.54
Tyco (TYC): -$18.70
Pfizer (PFE): -$51.39
Corning (GLW): -$60.33

Today the system that provides charting was down and unfortunately I had to go through the day without charts. The only thing I had available were the charts for the S&P Futures. So today I traded blindly.

But I used my instincts and what I saw on the Level2 to get through the day. The totals are somewhat disappointing, but considering the circumstances, I think I did alright.

You will notice that I traded Sprint-Nextel (S) today. I never really traded Sprint-Nextel before, but I must say this: I think I've found my new favorite stock! It has good levels that allow one to put on trades with 5000 or 6000 (perhaps more) shares at a time and when levels break, they are fairly clean. It also follows the Futures rather nicely.

From this point on, I am going to re-define what a good trade and a bad trade is (for this blog). Anything that makes $200 or more on a trade will be considered a good trade. Anything that is a $100 loser or more will be considered a bad trade. Since I am now starting to trade larger sizes, these kinds of trades should come more easily.

That being said, today there were no good trades nor any bad trades to tell you about. Another fairly choppy day today and no real good trends to trade with. We were caught in a narrow trading range today and I felt it was quite boring.

Finally, I'd like to mention that from now on, I may or may not post in the evening about what I'll be watching the next day. If I do not provide a post for what's on tap for the next day, you can assume that I didn't find anything of interest or that I'm still watching those stocks that I have mentioned in previous posts. I hope you all understand....

Monday, March 06, 2006

Drop It Like It's Hot!

Gross: +$634.82
Net: +$537.71
Loss From Top: 23.54
Trades: 51
Shares Traded: 93236

Stocks Traded Today (net profit/loss):
Bell South (BLS): +$222.01
Pfizer (PFE): +$188.80
EMC Corp (EMC): +$88.42
Boston Scientific (BSX): +$62.01
JP Morgan (JPM): -$2.73
Disney (DIS): -20.80

This morning the markets were trading in a very tight range and I couldn't really get much of anything going. As morning rolled into afternoon, the market dropped like a rock and I was able to put on some good trades which ended in a relatively good day.

The trade of the day occurred on Bell South (BLS) today. BLS slowly approached some support at $34.65, which had about 600 size on the bid. Then at 1:30PM, the Futures tanked hard! The size at $34.65 was getting hit fairly quickly, so I went short 4000 shares at $34.65. I took my profit as follows: 3-cent winner (1000 shares), 4-cent winner (1000 shares), 5-cent winner (1000 shares), 11-cent winner (1000 shares) ($230 profit before fees).

Shortly afterwards, the market tanked yet again and I managed to put on two quick trades on Pfizer (PFE). First trade was at 2:05PM when I went short 4000 shares for a 3-cent winner ($120 profit before fees). The second trade on PFE was at 2:21PM when I went short 3400 shares for a 4-cent winner ($136 profit before fees).

Yet another day with no really bad trades against me - though I still have to work on holding on to winners longer (the BLS trade could have easily been done for a 15-cent winner on 4000 shares - that would have been a $600 winner!). I've also got to work up more courage to trade larger share size; I started the day trading 5000 and 6000 shares at a time, but as the day progressed, I don't know why I started trading 4000 shares...that'll be something I'll be working on for tomorrow.

Sunday, March 05, 2006

On Tap for Mon Mar 6, 2006

Tomorrow I'll be watching Bell South (BLS). On Sunday, AT&T (T) agreed to buy BLS for $67 billion - which amounts to about $37 per share. I have been trading BLS quite actively the last few trading days so tomorrow will be interesting. BLS closed on Friday at $31.46.

On Friday, AK Steel (AKS) gapped up on strong volume after a report that US Steel (X) is in talks to buy the steel company. AKS closed at $13.99.

Lastly, I'll be watching Corning (GLW) again. It broke out of it's range three days ago and is making 52 week highs again. For the past two months or so, GLW has been fairly volatile and so I have avoided trading it too much.

Eat Any Good Books Lately?

I love to read. And I am always on the lookout for any good books about trading. I have gone through maybe about 20 books on trading, but have found that most of the material is re-hashed stuff from other books. I'm wondering if anyone out there has any good suggestions (you can leave suggestions by submitting a comment at the end of this post).

However, if the book you suggest has a section that explains what support and resistance is, I'll probably just throw that book in the garbage. If an author has to waste pages explaining the basics, they probably don't have anything of substance to say.

I have recently turned to biographies (because I was sick of skimming 95% of a book that has a lot of useless information) and I am currently reading two books.

The first book is about the 2nd richest man in the world, Warren Buffett, and of how he made his billions by investing. It's called: "Buffett: The Making of an American Capitalist" and so far it's been quite interesting - I find it to be a real page turner. Also somewhat inspirational in that it illustrates that anyone with a real passion for something can achieve anything.

The other book I'm currently reading (for leisure) is the John Grisham book "The Broker". I've always enjoyed reading Grisham's books, and when I saw this one, I initially thought it was going to be about a stock broker. It turns out to be about a lawyer-broker (well duh! It's a John Grisham book!). This one's a little different from his other books in that there is no courtroom at all! Still, it's been an enjoyable read so far.

Have any of you eaten any good books lately?

A Lot of Work for $30 (Fri Mar 3, 2006 Results)

Gross: +$118.69
Net: +$30.40
Loss From Top: 153.08
Trades: 51
Shares Traded: 85332

Stocks Traded Today (net profit/loss):
Pfizer (PFE): +$67.24
EMC Corp (EMC): +$41.61
Bell South (BLS): +$35.47
Pepsi (PEP): +$1.21
JP Morgan (JPM): -$44.77
Micron Tech (MU): -$70.36

Friday was another day when I wasn't really feeling the markets. There were many missed opportunities that I was just too slow to capitalize on. At the end of the day, I was left with only $30 to show for it.

Again, another day with no really good nor bad trades. However, I counted at least 5 trades that would have been very profitable (had I been quick enough), and that made all the difference today. When I have days like these, I'm usually really pissed off with the result, but I should look at the positive side of things: when I have bad days like today, I usually don't lose a lot of money (or sometimes end up with a slight gain), which is a good thing (means I am cutting my losses early before they get out of hand).

I did start using larger share size when trading on Friday, but I noticed that I was getting a lot of partial fills when trying to get 5000 or 6000 shares. I had many trades in which I only got 300, 400, or 1800 shares. This could have been because I was having an off day on Friday and I was a little slow in reacting, so we'll see how things go on Monday.

Thursday, March 02, 2006

On Tap for Fri Mar 3, 2006

Tomorrow I'll be watching Chesapeake Energy (CHK). Today it was up on massive volume as it was added to the S&P 500 today, replacing Dana Corp (DCN) on the list. CHK closed at $31.70

Speaking of Dana Corp (DCN), the auto parts maker is in big trouble. It missed interest payments on it's bonds on Wednesday and there is speculation that they may have to file for bankruptcy. Both Moody's and S&P cut it's debt rating. It was funny when I saw that this morning Deutsche Bank cut it's price target for DCN to $0 (I've never seen that before!). DCN closed at $1.04.

The news on DCN comes fresh off the heels of fellow auto parts maker Delphi Corp, which also filed for bankruptcy protection just a few months ago. It seems like the bad news for North American car makers and their suppliers keep on flowing.

Lastly, EMC Corp (EMC) has been uptrending and has been quite active lately. It is approaching its 52 week high of $14.88 and I have been actively trading this stock the last few days. EMC closed at $14.58.

Chop Chop!

Gross: +$430.28
Net: +$314.95
Loss From Top: 0
Trades: 71
Shares Traded: 105996

Stocks Traded Today (net profit/loss):
Micron Tech (MU): +$180.33
Pfizer (PFE): +$107.77
JP Morgan (JPM): +$91.54
BellSouth (BLS): +$53.32
Citigroup (C): +$25.23
Corning (GLW): +$25.10
General Electric (GE): +$11.58
EMC Corp (EMC): -$2.18
Tyco (TYC): -$3.76
Walmart (WMT): -$174.00

What a choppy day in the markets today! There were a lot of fake-outs and false moves and I found myself getting in, then getting out quickly. Our system was down for the first 30 minutes of the trading day, but somehow I found myself trading a lot.

Surprisingly, there were no real good trades nor were there any real bad trades either. Everytime I got into a trade, there was no real trend to trade it with, so I ended up getting a lot of my trades out for small winners. The reason the WMT number looks so bad is that I had a few small losing trades on it (it was very volatile today for some reason).

I'm going to start using larger share sizes when I trade from now on. I used to trade 3000 or maybe 4000 shares at a time, but it's time for me to step up a bit, so I'll try to trade using 5000 or 6000 shares at a time (of course, for thin stocks, I'll continue using 2000 or 3000 shares). So in the next few trading days, watch my numbers - I might be up (or down) a lot more (hopefully).

I've also noticed that the last few posts have become quite long and I fear I might be boring some people out there. So from now on, I'll try to keep my posts brief and to the point.

Wednesday, March 01, 2006

On Tap for Thu Mar 2, 2006

I don't know how I missed it, but there was a really strong move up on Corning (GLW) today. It broke out of it's range on strong volume and made new 52-week highs today. Aside from some positive comments from it's CFO at an investors meeting, I don't know what the catalyst for the move was. Could this be the breakout that starts a new uptrend? Again, I don't know why I didn't see this earlier today, but I will keep a close eye on GLW tomorrow. GLW was up $2.00 today to close at $26.41.

I'm also going to watch the telecom services stocks tomorrow. These stocks include Sprint-Nextel (S), AT&T (T), and Verizon (VZ). If you look at all of their charts, you will see that all three are close to testing their near term resistances. If the sector goes up tomorrow, I'll be watching for the following levels to break: for Sprint-Nextel (S) watch the level at $25, for AT&T (T) watch the level at $28.50, and for Verizon (VZ) watch for the levels at $34.50 and for the level at $35.

Sprint-Nextel closed at $24.51.
AT&T closed at $28.09.
Verizon closed at $34.20.

Also up big today was Texas Intruments (TXN). Goldman Sachs said that it expected TXN to raise it's outlook next week which sent the stock soaring today. I was watching TXN today and all I can say was that there was some CRAZY buying in the stock. I vowed not to ever trade TXN ever again after a big losing trade on the volatile stock a while back (I took a 25-cent loser on 2000 shares in less than 5 seconds - a $500 loser!), but it seemed to move quite nicely today. TXN was up $2.33 today to close at $32.18.

Patience is the Key - Impatience is also the Key

Gross: +$804.21
Net: +$742.41
Loss From Top: 0
Trades: 36
Shares Traded: 53910

Stocks Traded Today (net profit/loss):
JP Morgan (JPM): +$332.53
Hewlett Packard (HPQ): +$190.41
Micron Tech (MU): +$108.04
Advanced Micro Devices (AMD): +$94.65
McDonald's (MCD): +$34.97
Walmart (WMT): +$23.32
Pfizer (PFE): -$41.52

When I talk about patience, it is applied in two ways: patience in entering a trade (stalking your stock), and patience in exiting a profitable trade. When I talk about impatience, I'm talking about being impatient in getting out of losing trades (i.e. getting out of your losing trade as soon as possible).

Why is it that they say that 95% of traders out there will lose money? I think it's because they have their "patience" and "impatience" mentalities flipped - meaning that traders are impatient when they have winning trades on (get out too quick for a small profit), and too patient when they have losing trades on (waiting and hoping the stock comes back so that they can get out for no gain).

I know I have to work on patience when it comes to holding winning trades (riding winners), and I think I'm improving on exiting trades once they are 2-cent losers or more (though sometimes you can't help it when the stock jumps a few cents against you).

Today was really a test of patience. Yet another day of major morning moves, followed by a flat (I mean really flat) afternoon. After good morning gains, I began trading when the markets were flat. I put on 2 losing trades before I realized what I was doing and I'm glad I caught myself before it was too late. That's the reason why my # of trades are low today - it was a real test of patience. And believe me, I wanted to put on at least another 10 trades during the afternoon, but I managed to hold back.

Plenty of good trades today. First one was on Hewlett Packard (HPQ). At 10:25AM, HPQ was uptrending as was the Futures. There was mild resistance at the $33.50 level (about 1000 size on the ask), so I went long 3000 shares at $33.50 when it broke. Took my profit as follows: 3-cent winner (1000 shares), 6-cent winner (800 shares), 10-cent winner (1200 shares) ($198 profit before fees).

The next good trade came on JP Morgan (JPM). At 10:38AM, JPM was uptrending strongly when it encountered resistance at $41.65. There was about 3000 size on the ask when it broke. Went long 3000 shares at $41.65 and took profit as follows: 3-cent winner (1000 shares), 7-cent winner (1000 shares), 9-cent winner (1000 shares) ($190 profit before fees).

Last good trade to tell you about happened on Micron Tech (MU). At 10:52AM, MU approached the $16.00 level. There wasn't much size on the ask at $16.00 (maybe about 200 size), but the Futures ripped up hard, so I went long 4000 shares at $16.00. MU burst up, so I took out my entire position for a 5-cent winner ($200 profit before fees).

As you can see, all my major trades were done in the morning, but in the afternoon I had to try hard to stay awake! The overall market traded in such a tight range and as I mentioned before, I had to try hard not to trade. Near the end of the day, I did put on some profitable trades as the Futures kept making new highs on the day.

No real bad trades today (well, except for the two trades that were done in a trendless market), but I kept my losses to a minimum.