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== Averaging Down ==

MU was weak today. on a reversal, it rejected the VWAP twice before my first entry.

To seek a good entry I entered long before I saw a confirmation that it broke the VWAP.

My first entry was with a half my normal position size. I got stopped out.

Second entry also with same position size, but rather than stopping out, I kept adding, it even broke the moving averages and I kept adding. Eventually I decided to bail on it with a great loss.

I kept thinking now it will break out, and the market gave me all the signals that I was more likely to be wrong, but instead I was stubborn and paid the price.

After that point, I did some revenge trading on MU which only increased my losses.

 

The other lesson I learned here is that even if I wanted to get a good entry for break of the VWAP, I should have bought at some support (like MAs) rather than at resistance (VWAP). My losses would have been smaller. Both entries were right at VWAP.

2019-06-20_14-08-11.png.ba3008fcf5e3b16561a7103f7326e26c.png

 

Dear community members, don't do what I did. Hopefully I learned my lesson.

Edited by maher

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Thanks for your comment Abiel. Yeah, I couldn't agree more. This was an example of violating several rules that I "know".

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I took that trade before you. Trading reversals is tough especially at VWAP.

I got stopped out also.

See below:

image.thumb.png.5d96e2ae9e6a3d1eb3398d63f7ec9f2e.pngYou nailed it, get in at MA support, not vwap, also go long when it crossed vwap holds it and pulls back.

 

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volume is also low. 

It was not an awful trade, just not either 1) your/my edge 2) textbook setup.

These trades have lower probability of going well as vwap is a very important determinator to if the stock will be green or red for the day

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Yeah, the entry was bad but adding below the MAs on a 4th red candle was particularly bad..live to trade another day and learn I guess.

Damn MU got both of us today 🙂

You did much better than me though, it rejected the VWAP just once before you entered. I was so focused on the MAs and breaking the VWAP, I didn't even notice that VWAP was rejected twice. Amazing!

And you respected your stop-loss. 

Thank you very much for sharing your trade and comments with me.

 

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