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

Thursday, April 20, 2006

I Got Murdered By Walmart Today!

Gross: +$753.74
Net: +$558.86
Loss From Top: $30.09
Trades: 69
Shares Traded: 200600

Stocks Traded Today (net profit/loss):
Mircon Tech (MU): +$479.04
Johnson & Johnson (JNJ): +$206.72
Motorola (MOT): +$175.24
Citigroup (C): +$119.95
Merck (MRK): +$109.56
Hewlett Packard (HPQ): +$62.48
Corning (GLW): -$46.81
Pfizer (PFE): -$49.57
JP Morgan (JPM): -$117.14
Walmart (WMT): -$380.61

What a wild day it was for me today! I was up over $300 in the first hour and a half of trade, then in a span of 30 minutes I lost close to $550, then for the rest of the day, I made it all back plus a few hundred more!

In the morning, the overall markets had a good move upwards, then a rather sloppy move downwards, followed by flat (and I mean really flat) afternoon.

During the up move by the markets in the morning, I was very upset at myself for not catching any of it. I tried to get long on several stocks using 8000 shares, but unfortunately I was too slow and I was not able to get any shares at all!

Once the up move was over, I was really steaming mad (there was money being tossed everywhere, but I couldn't take advantage of it!). At that point (while I was still pissed), I put on 4 very bad trades in a row within a span of 30 minutes, and lost close to $550!

Boy! If I was mad before, you can only guess how much madder I was after I lost all that money!

I then took a little break to cool off and managed to get my head on straight. For the rest of the afternoon, I calmly made it all back and ended up with a fairly decent day. I can only imagine how much more I would have made if I hadn't traded angrily!

But today I couldn't believe my luck on Walmart (WMT)! Every trade on WMT was a losing trade for me! I lost almost $400 on it today and had it not been for Micron Tech (MU), I don't know where I'd be!

Looking back, I should have traded smarter on WMT. I should have paid closer attention to WMT's intraday charts. It usually doesn't look as ugly as it does today - the movements on it almost felt random at times.

Micron Tech (MU) however, was a cash cow today. It's movements were fairly nice and there was lots of size in which to get long on. I only wish I had used more shares when I was trading it.

Well, there are lots of good trades and lots of bad trades today. That was because today I mainly traded with 5000 and 6000 shares. I had tried several times to use 8000 shares, but most of the time, I got partially filled or I was too slow. I'll have to limit my review to the top 3 and worst 3 trades to make this post shorter.

Also note the number of shares traded today. Over 200,000 is a new record for me. I know it's small potatoes compared to some of the other traders at my company (some trade upwards of 4 million shares!), but to me, it's a good step forward - I'm starting to use larger share sizes and I'm not afraid to use it!

Good Trades
11:37AM - Motorola (MOT) looked like it caught some support and there was some nice sizes on the bid. I got long 5000 shares and got out as follows: 2-cent winner (3000 shares), 3-cent winner (2000 shares) ($120 profit before fees).

1:24PM - Johnson & Johnson (JNJ) had just finished downtrending and looked like it caught some support. Futures popped up a but, so I got long 3000 shares. Got out as follows: 4-cent winner (1500 shares), 5-cent winner (1500 shares) ($135 profit before fees).

2:07PM - Micron Tech (MU) looked like it was stuck in a 2-cent range. When it broke upwards, I got long 6000 shares. Got out as follows: 3-cent winner (3000 shares), 4-cent winner (3000 shares) ($210 profit before fees).

Bad Trades
11:03AM - Walmart (WMT) was moving all over the place while the Futures were doing not much of anything. I saw some size on the bid break, so I went short 6000 shares. Well, WMT was acting like a drunk trying to walk a straight line, but I held my position as it swung for and against me, hoping WMT would go down further. The Futures popped up, so I had to get out for a 3-cent loser ($180 loser before fees).
  • This was one of the 4 trades that lost me $550 - it was during this time I was trading with too much emotion
  • IF I had my head on straight, I would have seen that WMT was too unpredictable to be traded
  • It was one of those trades in which I saw something that gave me an excuse to get into a position - even though the trade did not fit all my trading criteria
11:24AM - Pfizer (PFE) had some size that broke on the bid, so I went short 6000 shares. The Futures were doing nothing. Well, like typical Pfizer, the Level 2 tricked me into getting into a position and I paid for it by taking a 2-cent loser ($120 loss before fees).
  • This was another one of the 4 trades that lost me a bundle. I was still trading with emotion at the time and I was forcing myself into positions in the hopes of making some of the money I missed out on
  • I should have known better - the intraday charts clearly showed PFE was uptrending at the time - why I chose to go short is a question I may never find out
  • One should NEVER EVER trade solely based on what the Level 2 says on Pfizer. This is one of the reasons I try to avoid trading Pfizer - because the Level 2 makes it soo tempting to get into a position that looks really good, but will end up costing you money!
12:19PM - JP Morgan (JPM) wasn't doing too much at the time and the Futures were flat. I had just retrieved my lunch when I saw something on the Level 2 to make me go long 3000 shares on JPM. I ended up taking a 3-cent loser (1000 shares), and 4-cent loser (2000 shares) ($110 loser before fees).
  • This trade was done out of haste - I didn't even have time to pull up the chart for JPM; I just sat down after getting my lunch and I saw something out of the corner of my eye on the Level 2, and I just quickly entered a position without thinking twice
  • Once I was in the position, I knew right away it was not a good one - the main reason this trade did not work out was because I did not fully assess the situation on JPM


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