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

Friday, May 12, 2006

A Psychological Barrier Broken - My First $1000 Day

Gross: +$1,066.00
Net: +$1,005.72
Loss From Top: 0
Trades: 28
Shares Traded: 53600

Stocks Traded Today (net profit/loss):
Citigroup (C): +$625.30
Bank of America (BAC): +$376.24
Disney (DIS): +$44.86
Micron Tech (MU): +$30.68
Motorola (MOT): -$71.37

As mentioned yesterday, I was going to tinker around with my trading strategy with the aim of trying to make $1000 in a single trading day.

Today I managed to do just what I was looking for. The keys were a combination of larger share size and holding on to winners longer.

One of the things I modified today was my exit strategy. In the past, once I was in a position, I would look at the Level 2 to see where I can comfortably exit a portion of my position. As an example, if I was long 6000 shares, I would look on the Level 2 to see where there was small size. I would then place orders to exit my position in 2000 shares increments (and I would cancel them if I think we were going higher).

So in this example I might put a 2000 share order to exit for a 2-cent winner, then maybe another 2000 share order to exit for a 3-cent winner, and maybe one final 2000 share order to exit for a 4-cent winner.

What I did differently today was that once I was in a position, I would try not place any exit orders. I would watch the prices and what I would do is wait for the stock's move to be over before I started placing orders to exit. If I felt like the Futures or the stock itself was turning around, I would try to exit the rest of my position.

The reason this helped me today was because I can ride winners longer by capturing more of the move. In the past, my orders would be filled and all I could do was watch as prices continued going higher.

I was also a little more daring with regards to share size. One of my trades on Citigroup (C) was for 8000 shares. Usually I would hit Citigroup with maybe 5000 or 6000 shares, so today was a big step for me.

By 11:15AM, I had reached my target and decided to call it a day while I was ahead (hence the low # of trades).

It was certainly a challege to finally get here, but I believe an even bigger challenge lies ahead: trying to make $1000 consistently. Nonetheless, today was a big boost psychologically - it tells me that I am capable of making this amount. The only problem now is that I have set the bar a little higher.

Only time will tell if today was a fluke or not.

I was glad to see that Citigroup (C) helped me to reach my target today. After being beaten badly by Citigroup the last 2 trading days, I found it a little easier to trade it today.

I'm gonna get my weekend started early and we'll see if I can have a repeat performance next week...

Good Trades
9:54AM - Bank of America (BAC) had just finished bouncing off support twice and reached the $49.40 level. There was about 200 size on the offer at $49.40 when suddenly large size suddenly appeared at $49.39 on the bid. The $49.40 level then started to break so I went long 5000 shares. Got out as follows: 1-cent winner (1000 shares), 2-cent winner (1000 shares), 9-cent winner (1000 shares), 10-cent winner (700 shares), 15-cent winner (800 shares), 16-cent winner (500 shares) ($390 profit before fees).

10:01AM - Citigroup (C) was uptrending as were the Futures. Size was breaking on the offer so I got partially filled long 4000 shares and got out as follows: 1-cent winner (400 shares), 4-cent winner (1000 shares), 5-cent winner (600 shares), 6-cent winner (2000 shares) ($194 profit before fees).

11:11AM - Citigroup (C) was uptrending while the Futures were slightly rising. I was watching the level on Citigroup at $49.52 because it had about 200 size on the offer. Then suddenly, a huge size of 800 appeared on the bid at $49.50. I quickly got long 8000 shares at $49.52 and got out as follows: 4-cent winner (2000 shares), 5-cent winner (2000 shares), 7-cent winner (4000 shares) ($460 profit before fees)

Bad Trades
None!

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