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

Friday, April 21, 2006

The Market Is Tanking...Why Aren't You Moving!

Gross: +$762.50
Net: +$612.56
Loss From Top: 0
Trades: 59
Shares Traded: 138000

Stocks Traded Today (net profit/loss):
Motorola (MOT): +$246.72
Citigroup (C): +$238.37
Micron Tech (MU): +$194.12
Johnson & Johnson (JNJ): +$48.31
Hewlett Packard (HPQ): -$19.31
Home Depot (HD): -$34.57
Walmart (WMT): -$61.10

The title of this post is what I found myself saying many times today. Several times I got into a position because the markets were tanking, however certain stocks (HD, WMT, and JNJ) just refused to go down!

I kept making the same mistakes over and over again on these three stocks. I kept getting into a position that didn't move. As a result, most of the profits from the morning were slowly eaten away by these trades in which I got out for even, or out for 1-cent losers.

It was only until the last two hours of the trading day was I able to make some real money.

Today I practiced patience. There were several times today in which a big position went against me initially, but I held and ended up with a profitable trade. I also limited my losses at the same time (I know it sounds like a contradiction, but trust me - there is a difference).

Managed to keep my losing trades at bay today. In fact, I was quite surprised I was able to keep my losses to a minimum, considering some of the sizes of my positions today. As a result, I only have one bad trade to report today.

I also had the patience to hold onto positions for a little longer than usual, and it resulted in some fantastic trades.

If only I hadn't repeated the same mistakes over and over again today, I would have had a great day. I'm just glad that I didn't lose too much when I did encounter these mistakes.

Good Trades
10:10AM - Citigroup (C) had finished tanking and appeared to bottom out. Just then, the Futures ripped up. I got long 6000 shares and got out as follows: 5-cent winner (2600 shares), 6-cent winner (400 shares), 7-cent winner (3000 shares) ($364 profit before fees).

11:24AM - Motorola (MOT) was downtrending, but there was huge support at $22.30 (there was over 1000+ size on the bid). The Futures appeared to be turning around as well. I got long 8000 shares at $22.31 and got out for a 4-cent winner on all 8000 shares ($320 profit before fees).

3:32PM - Micron Tech (MU) started uptrending and the Futures also started uptrending. I got long 6000 shares. Just then, the Futures ripped up. Got out as follows: 5-cent winner (3000 shares), 7-cent winner (3000 shares) ($360 profit before fees).

Bad Trades
11:08AM - Micron Tech (MU) was uptrending as were the Futures. When there was an opportunity, I tried to get long 8000 shares. I was partially filled for 3800 shares, when all of a sudden, the Futures started tanking. I quickly cancelled the balance of my order. In the blink of an eye, I was looking at a losing trade. I got my 3800 shares out for a 4-cent loser ($152 loser before fees)
  • Not much can be said about this trade. I guess you can call it bad timing. There was support behind my trade (there were at least 2 big levels on the bid behind my trade) - unfortunately the support quickly disappeared as soon as the Futures tanked
  • There will be trades like this from time to time - where it looks like the perfect trade, but it goes against you. I'm just glad I didn't get filled for all 8000 shares!


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