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

Thursday, July 20, 2006

The Trend, The Bounce, And The Momentum

Gross: +$653.60
Net: +$537.10
Loss From Top: 0
Trades: 93
Shares Traded: 124200

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$445.74
AT&T (T): +$262.26
Corning (GLW): +$6.89
Ford (F): -$7.39
Home Depot (HD): -$7.96
Hewlett Packard (HPQ): -$24.58
Advanced Micro Devices (AMD): -$36.15
Exxon Mobile (XOM): -$101.69

Today I tried out a few new strategies and implemented a few new rules I added last night. I used smaller share sizes (for testing purposes) and the results seemed fairly positive. I will continue to practice some of the new features of my trading strategy and hope I can begin implementing them with some decent position sizes soon.

I spent a lot of time last night re-organizing my trading strategies and divided my entry strategies into three categories: the trend trade, the bounce trade, and the momentum trade.

Trend trades will be those in which I hold for longer periods of time and basically trade with the trend. I will give these trades a wider stop-loss (maximum of a 5-cent loser) and will try to be patient with these positions. I will start the position off with small size and add more shares if the position continues to look promising.

Bounce trades will be those that will be in the opposite direction of a hard move made by a stock in the hopes of catching a bounce. Hold times for these positions will be fast and have a profit target of a few cents. Position sizes for these trades will be small.

Momentum trades will be my usual bread and butter trades in which I react off the movements of the Futures and where I'll attempt to hit size in order to get into a position. These position sizes will be larger and hold times will vary depending on where the Futures or the stock takes it.

From now on when I highlight my good and bad trades, I will denote them using (T) for trend trade, (B) for bounce trade, and (M) for momentum trade.

If I've got time on the weekend, I'll update the site so that terms and definitions will be available for viewing on the right side of this blog page.

Since I used lots of smaller size, I have no good trades nor any bad trades to review today (just lots of profitable trades under $200). Many of the trades I put on today involved only 1000 or 2000 shares.

Tomorrow I'll up my share size when implementing some of my new strategies and with luck there'll be stuff to review.

Good Trades

Bad Trades


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