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

Monday, November 06, 2006

Pop N' Chop

Gross: +$78.31
Net: -$221.93
Loss From Top: $517.60
Trades: 105

Shares Traded: 285938

Stocks Traded Today (net profit/loss):
Walmart (WMT): +$51.04
Hewlett Packard (HPQ): +$23.31

Home Depot (HD): -$5.72
General Electric (GE): -$8.83
Corning (GLW): -$22.78
EMC Corp (EMC): -$56.35
Motorola (MOT): -$71.00
Advanced Micro Devices (AMD): -$131.59

Man, what an ugly trading day I had today.

The morning started off well enough...but from about 10AM onwards, I just got sliced and diced, which was not fun at all!!

Any time the markets do what it did today, I always seem to get killed. Wait a minute, the markets were up big today...

So what did the markets do today you ask?

It did a "Pop N' Chop" - where there was a good pop (either up or down) in the overall markets early in the trading day (where most of the day's gain/loss occurs), only to be followed by choppiness for the rest of the trading session.

Yes - I know I don't do well when this happens...the only problem I have is that sometimes I don't recognize that it's a "Pop N' Chop" day and by the time I realize we've got a Pop N' Chop, it's often too late.

Within the first 30 minutes of trade, everything was going according to plan - I was up close to $300 net and I was following my trading plans as usual.

But a little after 10AM, a bad trade made me lose my focus (it was a very confusing trade - one that involved a double fill, followed by confusion, then a doubling up on a loser that I didn't realize I had on....I'll explain later).

From there I just kept trying to trade the sideways markets and by the time I realized what I was doing, I had lost almost $800 (I was down almost $500 net).

I took a break (went out for a walk) to clear my head (I admit I was kind of tired and my head wasn't 100% into trading today) and when I came back, I had to battle all afternoon to try to get back into positive territory.

But the chop of the markets today was horrendous and Walmart (WMT) really smacked me around today. All afternoon it was 2 steps forward, one step back and by the time I knew it, I was out of time and out of luck...

I have really got to focus more - it seems like whenever something breaks my focus, I have a hard time trying to re-gain it.

The ball-of-confusion trade I talked about earlier went something like this:
  1. WMT had just finished ripping up and huge size on the offer crossed the book down
  2. I went short 2000 shares just ahead of the huge size on the offer
  3. The Level II goes beserk and more huge size crosses the book on the offer
  4. I placed an order to exit my position several cents down, believing I'd be price improved
  5. The specialist took soo long that big orders began appearing on the bid
  6. In the confusion, it looked like I wouldn't get the price I was looking for, so I put another order to exit at a price slightly higher than my previous order
  7. Suddenly, more big size on the offer crosses the book down and I try to cancel all my orders - at this points I was totally unsure which way WMT would go - the specialist had yet to print for a very long time
  8. I didn't realize it, but I got double filled (both my orders to get out were filled), and thus I was in a long position (long 2000 shares)
  9. I THOUGHT I had successfully cancelled my orders and WMT started falling (which I thought was good because I thought I had a short position!)
  10. I put in an order to what I thought would get me out of my short position - so I put an order to buy 2000 shares
  11. When I get filled, I was confused - it said I was long 4000 shares on a stock that was falling!
  12. I hesitated for a bit, trying to assess what had just happened...this gave the stock just enough time to go down even further
  13. I didn't have enough time to piece together what had just happened - all I wanted to do was get out
  14. I eventually got out, but this (for whatever reason), made me lose focus and from that point on, I was trading without really following my rules
Tonight I'll get some good sleep and I'll try to focus a little more on the task at hand tomorrow.

Good Trades
10:00AM - Walmart (WMT) was uptrending while the Futures were also uptrending. The Futures ripped up hard and I managed to get long 2000 shares. WMT just popped up and I took it for a 10-cent winner ($200 profit before fees ; In: 10:00:12AM ; Long 2000 shares @ $48.07 ; Out: 10:00:32AM)


Bad Trades
10:06AM - Walmart (WMT) had finished ripping while the Futures were still uptrending. This was the confusing trade mentioned in my post. I somehow got long 4000 shares when I thought I was short 2000 shares. I got out of my long as follows: 1-cent loser (400 shares), 6-cent loser (3600 shares) ($220 loser before fees ; In: 10:06:09AM ; Long 2000 shares @ $48.15, Long 2000 shares @ $48.13 ; Out: 10:08:47AM)
  • I just don't know what to say - just an utterly confusing trade...a short that managed to morph into a long

12:36PM - Walmart (WMT) was downtrending while the Futures were sideways. The Futures popped lower and so I went short 2000 shares. I ended up shorting at the very low of the day (funny how that happens sometimes). I got out for a 6-cent loser ($120 loser before fees ; In: 12:36:36PM ; short 2000 shares @ $47.20 ; Out: 12:37:44PM)
  • I didn't really know why I decided to do this - my head wasn't in the game and this is what can happen
  • The Futures were sideways and it was at this point that I realized we had a Pop N' Chop day - a little late considering that after this trade I had lost almost $800
2:55PM - Walmart (WMT) was moving down while the Futures were moving slightly up. Not too sure why, but I went long 4000 shares at $47.50. This went against me and I got out for a 4-cent loser ($160 loser before fees ; In: 2:55:47PM ; Long 4000 shares @ $47.50 ; Out: 3:00:21PM)
  • This trade was put on while I was trying to make a comeback...it's funny how when you know time's running out and you feel rushed to make a profit you can somehow make some of the worst decisions
  • Just a bad decision all around with no real reason...




4 Comments:

  • JC,

    Great blog!

    Do you know where I can find a list of stocks with listing effective dates going to the Hybrid market?

    Thanks!

    By Anonymous Anonymous, at November 06, 2006 7:51 PM  

  • Anon@7:51PM,

    Thanks for your comments!
    You can check out the Hybrid list at:

    http://hybridtalk.nyse.com

    That's the Hybrid market blog - they are Hybridizing stocks in big bunches now and it makes it difficult for me to post them in this blog (I had originally intended to report them as they converted...but the NYSE is really churning them out now!).

    Good luck to you and your trading!

    By Blogger J.C., at November 06, 2006 8:17 PM  

  • I was wondering how you did since the market went back up after closing below the 12000. Sorry it was bad :(. Hang in there champ.

    Fernando

    By Anonymous Anonymous, at November 06, 2006 8:20 PM  

  • Fernando,
    Thanks for your comments.

    Yea - a lot of people are starting to feel a little bearish lately so this move back above 12000 might have caught a few people by surprise. I just have to get my head on straight and to avoid trading when the markets move sideways (or at least trade less when the markets are sideways). As usual, the weekend seems to have broken up my momentum (the weekends always seem to either break winning streaks or break losing streaks).

    Just gotta shake it off and go in tomorrow fresh!

    Best of luck to you and happy trading!

    By Blogger J.C., at November 06, 2006 8:52 PM  

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