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

Tuesday, March 28, 2006

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...


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