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

Thursday, September 07, 2006

A Slap In The Face And A Kick In The Pants

Gross: +$1,020.39
Net: +$819.25
Loss From Top: 0
Trades: 175
Shares Traded: 160908

Stocks Traded Today (net profit/loss):
Citigroup (C): +$278.03
Advanced Micro Devices (AMD): +$269.18
Walmart (WMT): +$135.08
Corning (GLW): +$89.42
Hewlett Packard (HPQ): +$69.89
Home Depot (HD): +$55.96
Motorola (MOT): +$9.16
Exxon Mobile (XOM): -$87.49

I am beginning to think that I sometimes need days like yesterday.

Why would I say such a stupid thing?

Well, it seems that everytime I have a terrible day like yesterday, my trading often improves for the next little while. It improves because on the bad days, I really beat myself up and I become extremely cautious and my trading begins following every rule to the letter.

But what happens is that as time goes by, I start coasting...and when I coast, I begin to get sloppy, I start ignoring rules and sometimes overconfidence kicks in. I then begin settling in, then I get into a little trading slump, then I finally get a really bad day like yesterday.

It's almost as if days like yesterday are like a slap in the face and a kick in the pants - a wake-up call if you will. Whenever I get shutdown and my day ends early, I'm usually fuming mad and I make it my mission for the rest of the day find out trade by trade what happened so that I can avoid doing it again.

Well yesterday's slap in the face and kick in the pants seemed to do wonders today. I really felt aware of when to trade and when not to trade, and I stuck to my trading rules, and I avoided trading stocks that did not fit all my criteria. The only bad thing about today was that I was cautious....maybe too cautious and I kept my position sizes small.

And so, every few months or so, I think I need to have a bad day, just to keep me honest and to keep me on my toes. Of course, I'd rather do without the bad days, but I think I need to feel the way I felt yesterday for the message to really hit home.

Today is the kind of day my trading SHOULD be like (except for maybe using bigger share sizes in my trades) and there were very few mistakes made today.

Anyways, I'm gonna try to do my "homework" early today because the NFL season kicks off tonight and I want to catch the game.

One good trade versus one bad trade today.

Tomorrow I'll see if I can duplicate today's efforts, but with bigger share size.

Good Trades
10:25AM - Citigroup (C) had a nice downtrend going and the Futures were also moving down. There was a big seller coming down on the Level II and so I put out an Arca order to get short 2000 shares and an Island order to get short 2000 shares. I got filled for both orders and that's when the Futures started tanking. I rode the 4000 share position for a 6-cent winner ($240 profit before fees ; In: 10:25:10AM ; Short 4000 shares @ $48.52 ; Out: 10:28:09AM)

Bad Trades
11:45AM - Exxon Mobile (XOM) was moving up while the Futures were flat. I saw some size show up on the bid and the offer had some size as well. When the size on the offer started to break, I auto-exed several 1000 share orders and got filled for 3000 shares long. The Futures were bouncing around and when XOM didn't go anywhere, it suddenly started tanking. I got my entire position out for a 6-cent loser ($180 loser before fees; In: 11:45:32AM ; Long 3000 shares @ $67.53 ; Out: 11:46:25AM)
  • This was one of the few trades that I shouldn't have put on
  • I trusted what I saw on the Level II and since the Futures were not doing anything at the time, this trade should not have been executed
  • This might have been one of those overconfidence trades...up until this trade, everything seemed to be going my way with very few losers...I guess I figured that since most trades were going my way, why should this be any different? Well I found the answer to that pretty quickly by taking a $180 stinker

5 Comments:

  • Hey JC!

    Great blog! Found you thru TraderMike. Thank you so much for sharing your numbers with us, esp. gross vs. net

    Curious as to how much buying power you are working with on a daily basis....

    Also wondering if the prop firm has Gainskeeper or some other tax software, or if you are responsible for tracking all that stuff?

    Since you are averaging over $5,000 a month so far this year, I think you are doing great! You will hit $10,000 before year end.

    Good luck, and good trading!

    By Anonymous Linda, at September 07, 2006 6:26 p.m.  

  • Linda,

    Thanks for your comments.

    The buying power they have given me is $900,000 and I can work with an unlimited number of shares.
    As for the taxes, we are responsible for our own taxes (yes, tax time is not going to be fun for me).

    And thanks for the encouraging compliments...I think it's just a matter of time before I hit that all-too-elusive target.

    Happy trading!
    JC

    By Blogger J.C., at September 07, 2006 7:34 p.m.  

  • Nee How JC,

    I've been a regular visitor of your blog for a few months now.

    I appreciate the time and effort you put into your posts and especially for sharing your trades with us. Seeing the dollar values makes it easier to relate.

    Just wondering if you can elaborate a bit on the Futures data you use in your trades? E.g., where and how do you access the futures quote and/or chart, do you look at the futures corresponding to the stock and/or do you look at a broader indicator?

    Thanks in advance and keep up the good work.

    Shyeh, shyeh.

    By Anonymous NJ Reader, at September 07, 2006 9:10 p.m.  

  • JC,

    Wow! Good luck in April! :( You can always get an extension!

    :)

    Also wanted to correct my previous post, I found you thru Ugly's blog, not TraderMike. But I read TraderMike, and about 10 other blogs.....sorry for the misquote..

    Also enjoyed your StockTickr interview.

    By Anonymous Linda, at September 07, 2006 9:47 p.m.  

  • nj reader and Linda,

    Thanks for the comments.

    nj reader,
    Thanks for the compliments. As for the Futures data, our firm has a connection to the CME (Chicago Merc Exchange) and they have made it accessible to all traders. The charts (both eSignal and our in-house charts) also have the capabilities to chart the eMini S&P Futures. How do I use the Futures? Well, most (but not all) stocks usually move with the Futures...what I do is I look for stocks that have been moving well with the eMini S&P Futures and whenever the Futures move quickly up or down, most (but not all) stocks usually move in the same direction. In a way, I kind of use the Futures as a leading indicator. Check out my interview at StockTickr (link is under the "About" section) to learn more about how I trade. Oh, and shyeh shyeh nee...(which reminds me, I'm slacking off in trying to learn the language!)

    Linda,
    I'm kind of dreading tax time...hopefully it is easier than I think. Yea, both Ugly and TraderMike are great resources so I'm glad you found your way here from either of these great blogs. Finally, I'm glad you enjoyed reading the interview...I hope I brought something a little different and I was quite honored when Dave approached me for the interview.

    Happy trading!
    JC

    By Blogger J.C., at September 08, 2006 7:45 a.m.  

Post a Comment

<< Home