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

Wednesday, August 30, 2006

Stuck In Neutral

Gross: +$587.16
Net: +$360.44
Loss From Top: 0
Trades: 153
Shares Traded: 212680

Stocks Traded Today (net profit/loss):
Hewlett Packard (HPQ): +$218.16
Walmart (WMT): +$168.99
Corning (GLW): +$105.36
Citigroup (C): +$34.29
Home Depot (HD): +$11.82
Motorola (MOT): +$11.20
Exxon Mobile (XOM): -$23.50
AT&T (T): -$33.09
Ford (F): -$59.83
Advanced Micro Devices (AMD): -$73.41

Today was the second day in a row in which I broke my record for most trades. Yesterday I broke it with 141 trades and today I broke it again with 153. What does that mean?

Well it means that I'm doing a lot more "quick" scalps for a few pennies and not doing enough of the "home-run" type scalps (where I go in with a big position). Most of my "quick" scalps only involve 1000 or 2000 shares and I'm usually out within a few seconds.

I usually resort to this kind of trading if I'm feeling defensive or I'm not 100% confident in what I'm doing. So far this week, that's how I've been feeling, and as a result, I feel as though I'm stuck in neutral and I haven't been able to really get my trading into first gear.

Don't get me wrong...so far this week I've seen plenty of good opportunities and the price action as been great on the stocks I trade, but I think my mind is still thinking about how the markets were last week and I've been trading with fear...fear that I would get chopped out of my positions. As a result, my fear has me looking less for that good trade with a good setup, and more on the "quick-and-give-me-a-few-bucks" type trades.

It is only now, as I review my day, that I am realizing this so let's see if tomorrow I can remedy this and try to finish August with a bang.

Another thing I've been noticing lately is that in the mornings I am usually fairly aggressive and I am usually willing to take big risks with big positions. But then when lunch rolls around, I become very cautious and scale back on position size. The problem is that when the afternoon trading picks up again, I think I'm still stuck with the "lunch-time" mentality.

In the afternoons I find myself reluctant to take the same risks as in the morning and I am finding I use smaller share sizes in the afternoon. It's as if the "lunch-time trade" plan has spilled over into my afternoon trading game plan.

Hrmmmm....this just came to me just now (thank goodness for this blog allowing me to discover this!).....let's see if I can remedy this also.

Two good trades versus one bad trade, all of them were on Motorola (MOT).

I'll be taking this Friday off as I'm going on a long weekend vacation, so tomorrow will be my last day of the week.

Good Trades
10:30AM - Motorola (MOT) had a nice uptrend and so did the Futures. When the Futures started ripping up, I went long 5000 shares. I got the entire position out for a 4-cent winner ($200 profit before fees; In: 10:30:47AM ; Long 5000 shares @ $23.85 ; Out: 10:32:09AM)

11:28AM - Motorola (MOT) was uptrending after it broke a significant resistance level ($24.00 level) while the Futures were rather flat. MOT reached another level with a reasonable amount of size on the offer (there was about 600 size on the offer). When it broke, I went long 5000 shares. As soon as that level broke, prices popped up and I got the entire position out for a 5-cent winner ($250 profit before fees; In: 11:28:19AM ; Long 5000 shares @ $24.10 ; Out: 11:30:37AM)

Bad Trades
10:22AM - Motorola (MOT) was uptrending and so were the Futures. There was a significant resistance level at $23.80 that had about 1800 size on the offer. The Futures suddenly started moving up and the level looked like it was going to break, so I went long 10,000 shares. The Futures continued ripping up and all the size was taken at the $23.80 level, BUT there was some reserve MidWest (an ECN) shares on the offer at the $23.80! It kept getting hit for what seemed like 10's of thousands of shares, but yet it kept refilling! The Futures had then started coming back down and I kind of panicked and dumped all my shares for a 3-cent loser ($300 loser before fees; In: 10:22:11AM ; Long 10,000 shares @ $23.80 ; Out: 10:23:43)
  • Ugghhh....I hate reserve orders on the Level II....and I hate the MidWest ECN (partly because I can't hit the MidWest ECN, partly because I always see reserve orders on MidWest)...
  • The setup on this trade was great and I followed all my rules on this one...again this was one of those cases where not every trade will go your way
  • If I had enough patience, I could have waited it out (you can see on the intraday chart that MOT was able to go through the $23.80 level easy enough)...but I guess because I scare easily, I ended up punching out

2 Comments:

  • J.C: Though I am not into scalping, your trades and result do impress me a lot. Good job.

    Gav

    By Anonymous Gav, at August 30, 2006 9:05 p.m.  

  • Gav,

    Thanks for your comments.

    Thanks for the praise...I do hope to improve my numbers as I go along and I also hope that I can eventually evolve my trading strategy to hold my trades for longer.

    Keep up the good work at your site...I'll be visiting everyday and maybe someday I'll be a "Dummy" trader like yourself, MaoXian, and others.

    Happy trading!
    JC

    By Blogger J.C., at August 30, 2006 9:23 p.m.  

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