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

Thursday, November 30, 2006

My Trading Journal Goes Into Retirement

Today will be the last day I will use my current trading journal.

Unfortunately, there are very few traders at the office that use one (in fact, I wouldn't be surprised if I was the ONLY one that uses a trading journal).

Every morning, every afternoon, and every evening I have written something in it.

It's pages are pretty much filled up, it's pages are all folded, it's cover partially ripped, and countless liquids have been spilled on it's pages (coffee is the #1 liquid).

My trade journal and I have been through a lot together and many of the lessons I've learned are contained within. This is actually my 2nd trading journal since I started at my prop firm (the first one had fewer pages and lasted me only 4 months).

Here's what it looks like (click on any of the images to enlarge):

And as you can see, most of it's pages are all folded up from me trying to cram it into my bag every day.

The very first entry was dated "Thursday September 1, 2005", which means this journal has been with me for one year and three months. On that very first entry I had a gross of +$269.90, a net of +$238.86 and I only made 21 trades!
There were some days in which I wrote a lot, and other days when I hardly wrote anything at all. Here's a sample of a day in which a lot was written.
A few months after I had started using this particular trade journal, I decided to fashion a back pocket that would allow me to store documents such as my trading rules and strategies. I used staples and tape and every day this back pocket would somehow scratch me from some of the deformed staples protruding from the back.
I used to write a lot in my journal, especially near the beginning of my career. In fact, I used to write down EVERY SINGLE trade in my trading journal. By the end of the day,
my hands would be all cramped up (both from all the writing and all the button pushing).

As the months went by, I found I wasn't using a lot of the information I was writing and so my trading journal sort of evolved. Here are some of my earlier entries

I then started paring down what I wrote down because I found that a lot of it was just a waste of ink. Here are some entries from the middle of my journal

And finally here are what some of my more current journal entries look like. As you can see, it's a lot less writing - mainly because I didn't need as much information and possibly because of laziness :)

For the first few months of my trading journal's life, I wrote down my trading rules and I made it a habit of reviewing them every month. I would remove and add things to my rules and I would write them down in my trading journal. I now have an electronic version on my word processor at home and I *try* to review it monthly. Here are some of my "Trading Rules" entries from my trading journal

Also of importance were the lessons I learned on my bad days. I put notes at the bottom of my entries, whether it was something I learned, something I needed to avoid, or some kind of behaviour I needed to be aware of.

I recently bought a new notebook that is smaller and more compact that this one and will become my new trading journal.

In the meantime, I wish my trading journal a happy retirement! You've served me well and we've been through a lot together. I only wish I can learn as much from the new trading journal as you have taught me!

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A Level II Trade

Gross: -$372.00
Net: -$443.51
Loss From Top: $443.51
Trades: 37
Shares Traded: 66700

Stocks Traded Today (net profit/loss):
Time Warner (TWX): +$48.94
AT&T (T): +$24.90
Advanced Micro Devices (AMD): +$8.91
Home Depot (HD): -$22.82
Walmart (WMT): -$26.53
Ford (F): -$169.05
Motorola (MOT): -$307.56

What a nice miserable end to a garbage month!

Well? What can I tell you...another month in which I couldn't get anything consistency, no big profits, and no real accomplishments this month (I don't even think I learned a thing!).

At the beginning of the month I was laughing at how pathetic October was...who's laughing now? I won't be surprised if I didn't make as much as last month.

I'll post up my end of month review either on Friday evening or on the weekend.

I won't bother telling you about the morning problems with the system...this is becoming routine now, so you can probably expect it to happen daily. In fact, as the days go by, the problems just seem to get worse and worse.

Oh well - I can't blame the system for my lousy trading...others were able to make money, so it's probably just me.

I missed a couple of nice moves on Ford (F) (level break at $8.20 at ~9:40AM) and AT&T (T) (break of $33.50 at about the same time) in the morning because the system was down....oh well - I guess I have to blame lady luck on that.

When the system stablized (around 10:30AM or 11AM), I felt I just had no rhythm in my trading. It could have been because of the garbage moves the overall markets were making.

I guess it serves me right trying to trade when nothing is going on...I'd like to thank my brain for thinking "Dang it! I missed many great moves this morning! I gotta do something!" - you did a great job of losing money brain! Way to go!

The one that really killed me was a trade on Motorola (MOT) (see bad trades below).

Motorola (MOT) was moving up and the Futures were doing diddly squat. I had intended to go long 2000 shares (since the overall markets weren't doing anything and MOT was moving in a choppy fashion).

But then I saw big size on the bid suddenly appear and for whatever reason, I decided that that was a cue to get in with a bigger position - so I went long 6000 shares.

Ha! There you have it! Level II trading at it's finest! I managed to lose $300 on that trade and from there I wasn't able to recover.

I continued losing more and then around 1PM, I decided I had enough of this garbage and I decided to go home (I didn't want to see how much money I could lose).

Am I upset about today's trading? No, not really (hence the sarcasm in my post) - in fact, I probably deserved what I got. I don't know why I keep falling for the same trap. I wish I could take a knife, cut out that part of my brain that thinks Level II trading is good and smash it to pieces!

Okay - I'm starting to sound a little frustrated....lemme just forget today ever happened and see if I can get December off to a good start tomorrow.

Good Trades

Bad Trades
11:02:07AM - Motorola (MOT) was moving up while the Futures were sideways. There was some big size on the offer at the $22.06 and I was waiting to get long 2000 shares if it broke. Suddenly big size shows up at $22.05 on the bid and so I quickly upped my order size to 6000 shares and I got long. MOT went up one cent, then came back down...I got out as follows: 3-cent loser (300 shares), 4-cent loser (2700 shares), 6-cent loser (3000 shares) ($297 loss before fees ; Long 6000 shares @ $22.06 ; Out: 11:03:55AM)

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Wednesday, November 29, 2006

3-Minute Man

Gross: +$589.79
Net: +$487.64

Loss From Top: $64.10
Trades: 64
Shares Traded: 116442

Stocks Traded Today (net profit/loss):
Ford (F): +$182.27
AT&T (T): +$159.91
Time Warner (TWX): +$104.57
Walmart (WMT): +$86.93
EMC Corp (EMC): +$58.50
Advanced Micro Devices (AMD): +$56.48
Motorola (MOT): +$32.08
Disney (DIS): +$25.70
Micron Tech (MU): -$0.22

Home Depot (HD): -$51.34
Exxon Mobil (XOM): -$63.68
Corning (GLW): -$103.57's not what you're thinking!

For the last few trading days, I've had a 3-minute chart up in addition to my usual 1-minute charts. Whenever I was in a position, I'd bring up the 3-minute chart and the 1-minute chart and my goal was to try to use the 3-minute charts to determine when I should get out of a position and for identifying trends.

Unfortunately I've been having chart trouble for the last little while (see the last few posts), but I started getting comfortable looking at the 3-minute chart.

And so, today I changed all my charts to 3-minute charts (with the exception of the Futures charts - I'll keep them at 1-minute and 5-minute).

I still have a long ways to go, but I'm really trying to watch the charts instead of the Level II when I'm in a position.

I know I'm a little late to the game and most others out there in the blog-o-sphere are using 5-, 15-, and 30-minute charts, but you have to understand that as a scalper that holds for only a few seconds to a few minutes and as a scalper that has a very tight stop-loss (usually 1, 2 or 3 cents), I'd get chopped to hell using longer-term charts.

But, I'm working on holding positions longer and if I want to use charts to dictate when I should exit my position, I'll have to change to a multi-minute chart.

Here's an example. Take a look at the following Walmart (WMT) charts for today. On the left is the 1-minute chart and on the right is the 5-minute chart (sorry, I couldn't find anything online that has 3-minute charts). In particular, look at the circled area of the chart (which highlights the same move on WMT).

I don't know about you, but if I were in a short position and I were looking at the 1-minute chart, I'd be paring my position several times on every little uptick.

However, had I been looking at the 5-minute chart (in my case, 3-minute....don't worry, I'll eventually work my way up to a 5-minute), it's definitely easier on the eyes and the trend is clearer.

So my transition to 3-minute charts is just the first step to clearing all that noise that the 1-minute chart displays. Now I've got to work on relying on the charts and not what the Level II is telling me (plus I've got to start getting comfortable holding positions for up to an hour!!!).

I won't bore you with today's system problems this morning (just see the posts from the previous two days - today was no different, if not a little worse). After about 11AM, the system stabilized and the charts were actually acting much better today (I only had to restart it 4 times today!).

At around 2PM we started having problems with orders and we were told not to put out any additional orders. I don't know if we came back up or not, but I took this as a sign to go home...I had some errands to run anyways so I thought I get them done before the rush hour crowds made their way home.

I was quite surprised at the number of stocks I traded today. This could be because I switched over to 3-minute charts, which had me changing the charts to different stocks a lot (with 3-minute charts I can more easily assess whether trends existed or not).

Two good trades versus no bad trades today.

Good Trades
10:04:20AM - AT&T (T) was moving up and so were the Futures. The Futures popped up so I went long 2000 shares. When the move stalled a but, I took half my position out. AT&T moved up a little further and the Futures started moving back down and I got the other half out. I got out as follows: 7-cent winner (1000 shares), 10-cent winner (1000 shares) ($170 profit before fees ; Long 2000 shares @ $33.39 ; Out: 10:06:24AM)

10:18:59AM - Ford (F) looked like it caught some support and started moving up while the Futures were moving sideways. Ford came up to the $8.30 level which had some relatively big size on the offer. When it broke, I went long 10,000 shares. Ford moved up a bit, but it seemed like sellers were not letting it go further and so I got everything out for a 2-cent winner ($200 profit before fees ; Long 10,000 shares @ $8.30 ; Out: 10:19:39AM)

Bad Trades

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Tuesday, November 28, 2006

Down, But Not Out

Gross: +$184.04
Net: +$45.67
Loss From Top: 0
Trades: 69
Shares Traded: 157400

Stocks Traded Today (net profit/loss):
Motorola (MOT): +$307.48
Ford (F): +$215.92
Valero Energy (VLO): -$1.83
Micron Tech (MU): -$19.57
Advanced Micro Devices (AMD): -$23.61
Home Depot (HD): -$24.90
Hewlett Packard (HPQ): -$44.76
Corning (GLW): -$65.45
AT&T (T): -$106.55
Walmart (WMT): -$190.91

Gonna keep this short as I have other things to do tonight...

This morning we all came into the office and it seemed like we were going to be in for a problem-free day....there were no warnings for latecomers and no notice about not logging in. A few people from the back office even came out to ask if everyone was okay logging in.

BUT, we were in for a wild is just a sample of some of the things that went awry:
slow execution, lots of Island book stickies, lots of Arca book stickies, ISI problems, chart freezes, quote freezes, a quotes server restart, Arca book going down, ISI going down, delayed quotes, slow cancel and disappearing orders (only to be filled after a long delay).

It was during this time I quickly found myself in a hole by a little over $400. At that point, I considered going home and to leave the problem-filled system behind.

But I stuck around - my thoughts were that I was down, but I wasn't out and if the system stabilizes, I might be able to work myself out of this mess.

So I sat patiently and waited until everything seemed stable.

Coming up to lunch, things seemed to calm down a bit and the system behaved itself.

However, I kept having intermittent problems with my charting software all day long. Many times I found that the charts were not updating. Other times I tried changing the charts to another stock, only to have it display a blank screen.

All in all, I restarted the charting application 8 times today (yup, I kept count). There were several times when all data prior to the application restart did not show up (so I ended up with basically no charts for a while).

By about 2:30PM, the charting software appeared to be back 100%.

For most of the day, I found it hard to find opportunities and hence the low number of trades. I just really had to sit tight and try not to trade.

One good trade and no bad trades. I just had several small losses in the morning.

I'm not going to bother with posting the charts tonight (you can have a look at the intraday charts yourself....just for tonight!).

Two more days and November is done!

Good Trades
11:59:25AM - Ford (F) was moving up while the Futures were chopping sideways. I noticed Ford a little too had already had a good run up so when I saw a chance, I got long 10,000 shares. I really had to have patience for this trade to work and got out as follows: 2-cent winner (5000 shares). 3-cent winner (5000 shares) ($250 profit before fees ; Long 10,000 shares @ $8.16 ; Out: 12:16:37PM)

Bad Trades


Monday, November 27, 2006

A Myriad Of Problems

Gross: +$338.64
Net: +$194.81
Loss From Top: $216.18
Trades: 97
Shares Traded: 120856

Stocks Traded Today (net profit/loss):

AT&T (T): +$159.96
Walmart (WMT): +$131.49

Hewlett Packard (HPQ): +$106.29
DirectTV (DTV): +$18.41
Advanced Micro Devices (AMD): -$4.03
Micron Tech (MU): -$44.48
Home Depot (HD): -$172.83

Boy what a sloppy way to start the week.

First, I came in a little late.

Then, I come in and I was told not to logon to our trading software and not to start the charting software. Apparently they've been having plently of problems lately and as a result, they were limited as to the number of people logging on between 9:20AM and 9:45AM.

So I had to wait (while others who came in earlier got to trade)....

While I was waiting to log into the system, other traders had problems with quotes, execution, and stickies (when ECN shares do not clear on the Level II, even when they've been filled).

At about 9:45AM, we were told that us "latecomers" could now log in.

However, I still had problems. I couldn't log in right away because the system said I was already logged on (maybe I didn't exit the trading application correctly last Wednesday), so I had to have that cleared.

When I finally logged in, I tried to trade, however the system still had me in shutdown mode (again, from last Wednesday)...basically the system barred me from trading because it had thought I lost too much money for the day (obviously a remnant from Wednesday). So I had to ask to be re-activated.

I got re-activated and I was getting ready to look for the first trade of the day when we were told that the quotes server was going down at 10:15AM. So I had to wait even further before I could even put on a single trade.

After the quotes server was restarted, I finally got to trading. However, I found that the day was full of problems. Very slow execution, messed up Level II's, and lots of difficulty cancelling orders.

Then around lunch time, my charts got all screwed up.

Unfortunately I'm one of the poor saps that use the in-house developed charting and for several months I've encountered lots of difficulties using it - and today was no different.

At first, I noticed that one of my charts were not moving at all. Then I noticed one of the other charts was also not updating. So I started changing the stock displayed on the charts.

However, whenever I tried to change the charts to another stock, all I got was a blank chart. I tried fiddling with it several times, but I couldn't get them to come back up.

So, I tried re-starting the charting application....however this made it worse!

When the charting software came back up, it didn't display any information prior to the other words, all my charts came up blank and only began charting prices after the restart.

I tried restarting the charting software several times without success, so I let it run for a bit so that it could at least collect some info...during that time I couldn't even change stocks on the charts (otherwise I'd get a blank chart).

It wasn't until around 3PM that the charts appeared to come back online 100%.

All in all, just a problem filled day.

I got screwed a couple of times today because of the slowish system...

There were a couple of times I put in an order and it didn't look like it went through, so I put in the order again and again. Only after a delay, all my orders ended up getting filled (I was over-filled).

I also put in a lot of orders that I thought were placed way before prices started moving, but I ended up not getting a position because the system was too slow to handle my order.

I know a lot of traders on the floor are really starting to get pissed off. The morning problems have been ongoing for several weeks now and frustrations are starting to mount. It didn't really bother me that much the last little while, but today I could really feel what the others are frustrated about.

If I were the one working in the back office, I'd be somewhat concerned. It's starting to get to the point where the anger is starting to boil over and I wouldn't be too surprised if one or more traders went back in the office just to find out what the heck is going on.

Oh well...I'm sure someone in the back office is getting hell over all of this.

BUT, I must remind myself that I could have traded better even with the technical difficulties...I don't want to give myself an easy way out by blaming the system. I just have to trade a little smarter.

One good trade versus no bad trades today.

Today, every time I touched Home Depot (HD), I ended up losing money on it. The problem was that I kept trading it and I kept losing money on it. I put on at least 10 trades on it, and each and every one of them lost money. I don't know why...

I guess tomorrow I'll have to look forward to another day of problems - hopefully by trading smart I can come out on top....

Good Trades
10:23:44AM - AT&T (T) was moving up while the Futures looked like it was starting to curve down. AT&T (T) had just broken the $33.00 level (I tried to get long here, but because of the slowish system, I didn't get shares, even though I punched in WAYYYY early). There was rampant buying after the $33.00 level broke, so I tried to get shares at $33.02. I only got 500 shares at $33.02 so I tried to get more at $33.03 and got another 1500 shares. I got out as follows: 5-cent winner (100 shares), 11-cent winner (1500 shares), 12-cent winner (400 shares) ($218 profit before fees ; Long 500 shares @ $33.02, long 1500 shares @ $33.03 ; Out: 10:26:09AM)

Bad Trades


Sunday, November 26, 2006

Weekly Top 3 List - Most Expensive Cars

In my "Weekly Top 3 List", I hope to provide a list of some of the finer things in life. I truly hope that one day, all us traders will one day make it and when we do make it, the costs of some of these items can no longer be an issue. My "Weekly Top 3 List" serves only as a motivator and is mainly just for fun.

This week I take a look at three of the most expensive cars according to Forbes' "World's Most Expensive Cars 2006".

1) Bugatti Veyron 16.4

  • Manufacturer: Volkswagon AG
  • Engine: 8.0 L Quad-turbo W16
  • Horsepower: 1001
  • Zero to 60 mph: 2.5 seconds
  • Top speed: 253 mph
  • Price tag: ~ $1,500,000
More info can be found at the follow:
Car & Driver

2) Pagani Zonda Roadster F C12S

  • Manufacturer: Pagani
  • Engine: 6.0 L AMG V12
  • Horsepower: 680
  • Zero to 60 mph: 3.6 seconds
  • Top speed: 220 mph
  • Price tag: ~$660,000
More info can be found at the following:

3) SSC Ultimate Aero

  • Manufacturer: Shelby Super Cars (SSC)
  • Engine: V8
  • Horsepower: 1046
  • Zero to 60 mph: 2.78 seconds
  • Top speed: 273 mph
  • Price tag: ~$654,000
More info can be found at the following:
SSC Autos

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Friday, November 24, 2006

Weekend Reading For Nov 25th - 26th

Since I often have a difficult time trying to integrate links to interesting articles in my posts, I thought I'd start posting "Weekend Reading".

In "Weekend Reading" I'll collect what I thought were the best posts and articles for the week from various bloggers.

Even though this week was a short one (and I seemed to be unconscious for most of it), there were plenty of great posts! Great job guys! Keep those excellent posts coming!

Brett Steenbarger reviews the 4 Things You Can Do Now To Improve As A Trader over at

Tale of the Tape reviews his possible fears and a review of the changes he made that may have affected his trading in Couch Time

Trader Gav lists and ranks all his books in My Trading Library

In his "$1000 Experiment", it's interesting to see how Richard from Move the Markets would spend $500 in a day and how he would spend $1000 in a day.

Tale of the Tape experiences a possible Eureka Moment.

Jan over at the Stock Market Blog talks about Dealing With Losses.

Richard came across an interesting lecture about how Happiness Is Not Where You Expect It.

Bulltrapper at Trade Guild revisits one of his best posts in Know Thyself...

At TraderFeed, Brett Steenbarger asks Are Moving Averages A Useful Trading Guide?

An excellent post by Tyro in Trading vs Corporate Life.

Trader ZBS goes over The "Not-So-Simple" Rules Of Trading.

For those interested in trading options, Phileo reviews how he trades them in When Forrest Gump Met Dummy.

Piranha reviews the top 10 (or should I say 15) blogs he follows in Piranha's Top 10 (thanks for the mention Piranha! ;) )

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Wednesday, November 22, 2006


Gross: -$427.00
Net: -$508.38
Loss From Top: $641.65
Trades: 35
Shares Traded: 100000

Stocks Traded Today (net profit/loss):
AT&T (T): -$6.59
Micron Tech (MU): -$58.65
EMC Corp (EMC): -$94.01
Motorola (MOT): -$125.58
Advanced Micro Devices (AMD): -$223.74

Sick....that's all I can say about today's trading and the way I felt today.

This morning I woke up late and I really had to drag myself out of bed and I somehow got myself ready and I managed to get into the office.

Once there, it was just one bad trade after was almost as if I was actively trying to lose money.

And I don't know why, but I didn't record any of my bad trades in my trading journal....perhaps at the time I didn't think they were bad? Maybe I was half-asleep at the wheel? I don't know....I just went from a losing trade to the next...everything was kind of a blur.

A little later on, the system shut me down and prevented me from trading any further...almost as if the system were saying "Whoa there buddy...something is not quite right with you - you've lost enough money for today...go home and take the rest of the day off".

It was a good thing the system did shut me down because Lord knows how much more money I would have lost.

My day was done by 10:30AM - I lasted only an hour.

I made my way home and then I hit the sack pretty hard and basically slept (and sweated) the day away.

I'm feeling a little bit better right now and I'm a little more conscious. And I am also more conscious of the damage I did today in my trading and I am now assessing the consequences of attempting to trade today.

At my old 9-to-5 job, I welcomed sick days and I tried to make the best use of them. Even if it was a minor thing, I'd call in sick simply because it got me out of doing something I didn't really enjoy doing.

Well since I started trading, I hate taking sick days. Trading is something I love to do and I'd rather be trading than lying in bed trying to rest it off.

Today however sent a clear message: even though trading is something I love to do, calling in sick is the best thing I could do for my trading and for me physically.

I'm just glad American Thanksgiving is upon us...I hate to think of losing another trading day because I was sick.

Hopefully today is a $500 lesson I won't soon forget...and I hope you all can learn from this mistake as well.

I'm done for the week...I have 4 days to recover before trading again on Monday. I want to wish everyone a happy American Thanksgiving

Good Trades
I don't think there were any...I didn't record anything in my trading journal.

Bad Trades
I think there were maybe one or two, but I don't know why I didn't record them in my journal


Tuesday, November 21, 2006

A Shot Morning & An Afternoon That Could Have Been A Lot Better

Net: -$92.18
Loss From Top: $135.99
Trades: 42
Shares Traded: 66800

Stocks Traded Today (net profit/loss):
Micron Tech (MU): +$34.54
Exxon Mobil (XOM): +$26.57
Walmart (WMT): +$7.66
Home Depot (HD): -$5.31
AT&T (T): -$24.10
Hewlett Packard (HPQ): -$43.28
Advanced Micro Devices (AMD): -$88.27

Yesterday my wife came down with a fever and this morning I started showing signs of it too.

All day I had a few chills down my spine, I felt dizzy, and I had a headache the whole day.

This morning I got in and we were told that the execution server was other words, we couldn't trade (maybe I should have taken this as a sign to go home).

We all waited the entire morning and I didn't get to trading until maybe around 12:30PM. By that time I didn't feel good at all...I felt a great need to sleep.

Anyways, I would have been better off just taking the day off...but I don't know why I decided to stay.

In the afternoon the overall markets just sat there and whenever I broke out of my daydreaming/zombie state, I put on trades that were not very good at all.

The travel home was not very comfortable (kept having bouts of chills down my spine) and so when I got home I went to get some rest. My wife came home early from work too and I found her already taking a nap in bed...

Yup, just two sick people trying to rest it off...

Anyways, I still have a headache as I write this so I'll keep it short.

Just one good trade (not going to bother posting up a chart) and no bad trades.

If I do go in tomorrow, I'll probably just trade the morning...I have a feeling the afternoon tomorrow will be just as bad as it was today.

BUT, I'm glad to see some other bloggers did well today...

Ugly was able to bounce back after yesterday's results.

Tyro as usual was able to pull off some good numbers.

Of course, Cal posted big numbers again.

It's great to see DehTrader getting back on track.

It's also good to see Boogster make some coin on a day like today.

Zoomie over at Move The Markets also pulled off a great winner.

Fly On Wall St. also had a great day.

Great job guys! And keep posting up great numbers!

Starting to feel chills down my spine again...time to take a hot shower and see if I can sweat it out...

Good Trades
12:57:49PM - Micron Tech (MU) moving up and Futures sideways. MU broke some resistance so I went long 5000 shares. I got out as follows: 3-cent winner (2000 shares), 4-cent winner (3000 shares) ($180 profit before fees ; Long 5000 shares @ $14.63 ; Out: 1:04:21PM)

Bad Trades


Monday, November 20, 2006

Figuring It All Out

Gross: +$573.04
Net: +$315.94
Loss From Top: 146.40
Trades: 112
Shares Traded: 249992

Stocks Traded Today (net profit/loss):

Walmart (WMT): +$360.79
Home Depot (HD): +$310.47
Motorola (MOT): +$111.65
Corning (GLW): +$0.74
Advanced Micro Devices (AMD): -$21.10
AT&T (T): -$88.76
General Electric (GE): -$158.90
Hewlett Packard (HPQ): -$198.93

Near the end of the trading day today, our branch manager announced that we had a new Master Trader (a trader who nets $120,000+ within a 12-month period).

The new Master Trader became full-time just two months before I did and when the branch manager first announced it, I felt myself slouch a little, feeling a little jealous.

At the end of the day, I packed up and caught up to this new Master Trader. I congratulated him and we got to talking on our way out.

I asked him what kind of things he was doing with his trading and what stocks he traded. He went on to describe how he traded and it sounded eerily similar to what I do and he basically trades the same stock I trade (Home Depot, Walmart, AMD, etc).

I then asked him if he was a big position trader, thinking that he was probably putting on 20,000 or 30,000 share positions on these same stocks I trade. He said he simply traded around 2500 shares and at first I thought he misspoke and really meant 25,000 shares at a time.

As we continued our discussion, he said it again - he usually went in with 2000 shares! On those same stocks, I usually put on 4000 or 5000 shares at a time!

Upon hearing this, I got really excited! Here I was, thinking that most of the money makers were putting on huge sized positions (40,000+ shares) and that it would be next to impossible for a trader like myself to get way up there.

But here was this Master Trader who traded the same way I do - BUT WITH SMALLER SHARE SIZE!

I then went on to talk to this Master Trader about my trading difficulties - about how the last few months I've seen my profits continue to slide south and about how my confidence level was sky high just before the summer, but now seems to be at a low.

This Master Trader then stopped me there and told me that that situation was exactly the same situation he was in a few months ago. He said that for about 6 months he was slowly seeing his profits go down and it got to a point where he had to start considering taking in a part-time job.

I then stopped him and told him that this was exactly in the same spot I'm in right now!

He then went on to tell me that during the rough spell, he did a lot of serious thinking and he made some tweaks here and there and then...well...he just figured it all out!

He told me that there were two things that turned his trading around:
1) He had to learn to hold on to a temporary loser IF there is a strong possibility the trade will continue going in your favor (in the past, he'd usually just punch out)
2) Holding onto your winning trades EVEN when big size suddenly appears and gets in the way

I couldn't believe it!

These two things he mentioned are the things I have been working on over the last 2 or 3 trading days!

The last couple of days I've been holding onto temporary losers if I have a strong belief that the move will continue (whereas before I simply punch out no matter what) AND I've been holding my positions and staring big size in the face and telling it "I'm not afraid of you!"

After our conversation, we parted ways and I found myself with a new found confidence. It no longer seemed impossible to make good money (i.e. I don't have to use 40,000+ shares) and that the things I've been working on are definitely steps in the right direction.

Anyways, today was another day in which I found it difficult to trade. I caught some good moves on Walmart (WMT) and Home Depot (HD) in the morning, but I found myself fighting all afternoon.

Today I also practiced those two main points that the Master Trader talked about, though I still put on some trades that were questionable and foolish given the way the markets moved this afternoon (that I'll have to work on).

On most of my trades today I felt there was definitely more patience...patience when the trade initially went against me and patience when the stock seemed to stall. I also didn't really feel as anxious with my trades.

At roughly 10:45AM, Walmart (WMT) had a nice move upwards and I managed to take almost $500 from that move on several scalps.

Then at around 11:30AM Home Depot (HD) also had a nice move upwards and from this move I was able to take a little more than $450 on several scalps.

However, I gave back some of those gains throughout the day and it really felt like two steps forward, one step back all day today. I know I overtraded today and I would have been better off not trading as much in the afternoon.

Two good trades and one bad trade today.

With the similarities between my trading style and the new Master Trader's trading style, I feel I'm close to figuring it all out. After all, the Master Trader was able to figure it out, and so will I. I can feel it...I'm on the brink and I hope that everything I had hoped for is just around the corner...

Good Trades
10:58:42AM - Walmart (WMT) started moving up while the Futures were also moving upwards. I went long 3000 shares when I had a chance to and got everything out for a 7-cent winner ($210 profit before fees ; Long 3000 shares @ $47.89 ; Out: 10:59:55AM)

11:33:14AM - Home Depot (HD) was moving up and the Futures were moving up slightly. HD reached resistance at $38.50 and when it broke, I went long 4000 shares. I got out as follows: 3-cent winner (2300 shares), 5-cent winner (1700 shares) ($154 profit before fees ; Long 4000 shares @ $38.50 ; Out: 11:35:34AM)

Bad Trades
1:33:48PM - Hewlett Packard (HPQ) was moving up while the Futures were flat. HPQ reached some significant resistance at the $40 level. At the time, I was thinking that since everything was flat, the $40 should hold and probably wouldn't break, so I went short 4000 shares @ $39.99. Just then some big orders suddenly cleared out the $40 and I started scrambling out of my position. I got out as follows: 2-cent loser (500 shares), 4-cent loser (3500 shares) ($150 loser before fees ; Short 4000 shares @ $39.99 ; Out: 1:35:03PM)

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Sunday, November 19, 2006

Toronto - Performing Arts Centre, Chinatown & Eaton Centre

I love to travel and I often wonder what it's like to live in another city. I also love hearing about what other people do in their city - the things to do, buildings to visit, and events that occur there.

With that in mind, I thought I'd begin sharing with yo
u some of the things that I do in Toronto - to give you all a little taste of what it's like living here.

Obviously my weekdays are fairly busy, but on the weekends I try to get as far away from trading as possible by being active in the city.

I hope in the future I will get a chance to visit your little corner of the world, but until then, I'll share with you a little bit of mine. This will also give you an idea of how I unwind and what I do with my spare time.

Last weekend my wife and I went to the Four Seasons Centre for the Performing Arts to watch "The Sleeping Beauty" performed by the National Ballet of Canada.

The Performing Arts Centre was completed earlier this year and the performance we watched last weekend was really an excuse to go visit the building. Both of us were quite impressed by the Performing Arts Centre - everything about it was clean and modern and we loved how the majority of the building is surrounded by windows...people inside could see out and people outside could see in.

Here are some shots we took of the Performing Arts Centre (click to enlarge):

Yesterday (Saturday) we attended some events at the 10th Annual Asian Film Festival happening here in
downtown Toronto. The film festival involved mostly short films from around the world. We took in several short films from South Korea and afterwards we headed out to Chinatown for dinner.

I've always been fascinated by the different Chinatowns from around the world. Here are some pictures of how our's (Toronto's) looks like at night.

Today we headed downtown to check out the 102nd Annual Santa Claus parade. It was a cold, crisp day in Toronto and after the parade was over we went into the Eaton Centre in the heart of downtown Toronto (the 3rd largest shopping mall in Canada) and this was what we saw:

Okay, it was because the Santa Claus parade had just finished and it doesn't look like that all the time (though during the holiday rush, it can get pretty close!).

All in all, it was another weekend that felt like a vacation and we all know we could use a little more of those!
I hope you all enjoyed your weekend because I sure enjoyed mine!

That being said, I'm all ready for another (shortened) week of trading!

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Weekly Top 3 List - Most Expensive Wines

In my "Weekly Top 3 List", I hope to provide a list of some of the finer things in life. I truly hope that one day, all us traders will one day make it and when we do make it, the costs of some of these items can no longer be an issue. My "Weekly Top 3 List" serves only as a motivator and is mainly just for fun.

This week I take a look at three of the most expensive wines that you could (possibly) find at your local liquor store according to's "Top 10: Most Expensive Wines".

1) Domaine Romanee Conti 1997

  • French red Burgundy wine
  • Smells of berries and spice
  • A very rare wine and will be finer the longer it remains unopened
  • Price tag: ~ $1500 a bottle

More info can be found at the following:
Berry Bros. & Rudd

2) Petrus Pomeral 1998

  • Merlot, deep purple in color
  • Smells of fruits mixed with vanilla, caramel and mocha
  • Was once a favorite at the White House during the Kennedy years
  • Will be at it's finest in 2012
  • Price tag: ~$1400 a bottle

More info can be found at the following:
The Antique Wine Company

3) Chateau Le Pin Pomeral 1999

  • Merlot, ruby red in color
  • Smells of cherry fruits and spices
  • Will be at it's finest between 2004 - 2015
  • Price tag: ~$850 a bottle

More info can be found at the following:

The Wine Buyer
The Bottle Shop

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