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

Friday, February 16, 2007

The Trade That Got Away

Gross: +$624.00
Net: +$472.64
Loss From Top: 0
Trades: 40
Shares Traded: 208200

Stocks Traded Today (net profit/loss):
Ford Motor Company (F): +$444.51
Alcatel-Lucent (ALU): +$119.33
Campbell Soup Company (CPB): +$86.23
Nortel Networks Corporation (NT): +$59.57
Allied Waste Industries Inc (AW): -$4.17
AMR Corporation (AMR): -$37.76
The Mills Corporation (MLS): -$94.47
Time Warner Inc (TWX): -$100.58

Man oh man!

I missed a golden opportunity today and I missed it by a fraction of a second! Literally!

Ok - so the day is going along with very little happening in the way of opportunities.

Then at around 11:30AM, we hear rumors that General Motors may be in talks to buyout DaimlerChrysler (DCX). Both these stocks make big moves.

At the time, I was watching Ford (F) all morning as it chugged along in a narrow trading range. But after the GM/DCX news, Ford (F) slowly starts moving upwards, taking out some heavy resistance along the way.

When the upper end of Ford's (F) trading range looked like it was going to break, I hit it - with 30,000 shares (the biggest position I've held to date).

So Ford (F) moves up one cent and just stays there. I waited for a few minutes and I began feeling a little impatient with the trade. I had thought that the GM/DCX news may move Ford and when it looked like Ford was going to move to the upside, I hit it with full confidence.

But here I was with 30,000 shares of Ford (F) and what I thought it would do, it wasn't doing. So I waited for a few minutes. Every minute I was in that trade felt like an eternity.

Then, something in my brain said "Well, Ford is not going where you thought it was going to go" and at that moment, I decided to exit my 30,000 shares for break even.

BUT literally at that same moment, Ford rips up 17-cents! I got my shares out for break-even and Ford just moved up like crazy to the upside!

Just look at the chart:


I went long 30,000 shares @ $8.57 and I waited for about 4 or 5 minutes. Ford didn't do anything and just when I wanted to get out, Ford decides to move.

Even if I had taken only a 5-cent move, that would have been $1500! If I had captured a 10-cent move, it would have been $3000! If I had taken the whole move, it would have been a $5100 move!

Yes yes, I know....I probably wouldn't have had the courage to hold through the whole move, but I would have at least caught a good chunk of it.

I should have known to give Ford (F) more time to work. On other stocks, moves can occur rather quickly, but when you're trading stocks like Ford (F), you sometimes have to be extra patient for a move to occur. You may even have to wait an hour before Ford moves one-cent sometimes.

Well, after I got out (and watched Ford move like crazy), I did manage to catch some of the move it made, but only on 10,000 shares.

Well that was the big trade that got away from me today.

Aside from that, the day offered no opportunities at all. In fact, I stayed intently for the whole trading day...but I didn't even put on a single trade in the afternoon.

I guess if I continue doing what I've been doing lately, sooner or later I'll catch one of those big moves. Today I missed it by a fraction of a second. Had I hesitated, even for a split second, I might have been able to catch that move on Ford.

Oh well....it's time for a long weekend...time for me to re-charge (after the week I've had, I feel as though I desperately need it!).

Happy President's Day! Happy Chinese New Year! Happy long weekend!

Good Trades
None - well, there was one on Ford (F), but I didn't record it as I sat there in disbelief that I missed a huge trade by a fraction of a second!

Bad Trades
None

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6 Comments:

  • hi, man, it's so close! You will catch next Ford. Have a nice weekend.

    By Anonymous zbs, at February 17, 2007 12:04 AM  

  • 8.57 X 30000 = 257100, wow, that's a big bet on one shot, I would have adrenaline rushing all over my vein

    By Anonymous Anonymous, at February 17, 2007 2:27 AM  

  • ZBS,
    Thanks for your comments. Yea! Sooo close! At least I'm getting used to trading bigger share size, so next time I'll catch Ford! Have a good weekend and Happy Chinese New Year!

    Anon@2:27AM,
    Thanks for your comments. Yea - I've been slowly working to courage to trade bigger share size. But that 30,000 share position really had the adrenaline pumping! It's beginning to seem routine to trade 10,000 shares on GE, MOT, TWX, and EMC, so stepping it up seems like the next step. There's one guy at the prop firm where I work that likes to trade Ford and he usually does it with 50,000 or more shares at a time (yesterday unfortunately, he wasn't in). There are others that routinely do 50,000+ shares on other stocks like GE, MOT, and PFE....one day I'll get there, one day! Good luck and have a great weekend!

    By Blogger J.C., at February 17, 2007 8:15 AM  

  • One minute parabolic SAR for support. (Would have kept you in for that extra minute or so that you needed.)

    By Anonymous Anonymous, at February 17, 2007 6:42 PM  

  • I always forget to mention how much I enjoy watching your trades. You have most of what you need to be a highly profitable trader. A few more years and you'll develop the confidence necessary to stick with the winners. Keep up the good work.

    By Blogger Shane, at February 17, 2007 8:11 PM  

  • Anon@6:42PM,
    Thanks for your comments. Oh man! I wish I was using SAR! Even if it kept me in that trade for another second or two, it would have worked!

    Shane,
    Thanks for your comments and thanks for the good words. As always, your site provides great entertainment for all of us! Keep it up!

    Good luck to all and enjoy the long weekend!

    By Blogger J.C., at February 18, 2007 8:50 AM  

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