Follow me to profitability!

[Stevecb06 6]

Hey guys,

My name is Steve.  I am a long time BBT member.  Over the years, I have tried and failed at day trading probably 3 or 4 times.  I have never gone the traditional path of 'blowing up' an account, but I have never been able to be continuously profitable.  I always seem to hover around breaking even or taking a slight loss.  Where do I fail?  Discipline.  I tend to make a few good trades, and then one bad one that sets me back to square 1.

I've decided once again to give it another go.  However, this time my main focus is going to be discipline.  I'll be sharing all of my trades here with the community.  This is mostly to hold myself accountable, but I also hope it provides some value to someone out there.

Here are a few rules I am putting in place for myself:

• I am going to be trading one setup, and one setup only (more on this later)
• I am going to trade EXTREMELY small.  I am funding my account with $200 only.  Most of my P/L is literally going to be in cents, not dollars.  I don't care.  I am purely making trades to make trades, and not even thinking about the money at this point.  In fact, I have configured ThinkOrSwim to not even show my P&L during trades, and I have my account P&L hidden in the platform.  The only time I will mention P&L is in my journal.
• Because of the small account size, I will be subject to the PDT rule.  I am viewing this as a good thing.  It will force me to be super selective about what trades I enter.  I expect there will be days where I won't make a single trade if I am not seeing my setup.  If I find that I am really being hindered by 3 trades a week, I may consider bringing my account size up to $2,000 and converting it to a cash account.  We'll see.
• At the end of each month, if I am not profitable, I will reset my account back to $200.  If I am profitable, I will add another $100 and allow myself to trade slightly more shares.

My setup:

After failing at day trading a few times, I started to look into swing trading instead, as I thought it may be a better fit for me.  I read a few different books, but naturally gravitated towards Mark Minervini's 'Volume Contraction Pattern' style of trading (essentially just an ascending triangle trend continuation patter).  For whatever reason, this setup just made sense to me more than a lot of others have, and I started to study it thoroughly.  One of the interesting things that Mark Minervini mentions several times is that this pattern shows up and works on any time frame.  I started to monitor stocks during the day on the 1-minute chart and started seeing this pattern show up over and over again.  The best part, it's a setup that unfolds over a longer period of time, perfect for me trading while working a 9 to 5.  Most of the setups come late morning or early afternoon as a trend continuation.  I decided I would jump back in and give day trading another shot using this strategy.

 

[Stevecb06 6]

11-8-24

Summary:
I took one trade today on a pretty good setup.  I was happy with this small win to get started off on the right foot, but most of all I was happy with my patience and discipline.

P&L = +$0.61

FTNT was having a big break out day and was consolidating near the high of the day.  I missed the breakout of the HOD but got in on the first pull back.  I took half off at about +2R and got stopped out on the rest shortly after at about 1R.

[Stevecb06 6]

11-12-24

Summary:
Another 1 trade day for a small win.  Again, the key win here for me was patience and discipline.

P&L today = +$0.49
Total P&L for November = $1.10

ZI popped up on the HOD scanner and it looked like it was poised for a pretty clean break of the HOD.  I was a little hesitant on this one, so rather than get in right at the break, I waited for the break and retest.  I got in once I saw a successful retest at the 20-period moving avg and got in after that.  I took half off at right around +2R and got stopped out at a little under +1R on the other half shortly after.

[Stevecb06 6]

11-13-24

Summary:
1 trade for a big loss today.  After the loss I was out of PDT trades, so I closed my platform and quit for the day.

P&L Today = -$1.16

Total P&L for November = -$0.06

Trade Recap:

I don't think this was necessarily a bad setup, but my execution was terrible, and I got caught up in a liquidity grab.  I was watching consolidation and waiting for a break of the level around $63.05.  The break came quickly with a huge amount of volume, quickly jumping up to $63.20.  Because I was using a market order, I got a terrible fill at $63.19, when I was shooting for entry around $63.06 or $63.07.  Immediately after my entry, it flushed just as quickly as it jumped.  Had my entry been proper, my loss would have been limited to about $0.60, which is a lot closer to my current targeted risk of about 50 cents per trade.

Edit:

Upon looking at this trade again, it was pretty clear from the massive sell off in the $63.20-$63.40 area earlier in the morning that I should have expected hard selling pressure in that area again.  I was treating $63.05 as the high level, but really, I should have waited to see the $63.40 level tested again to see how it would react.  This setup was nowhere near ready for me to enter.

Lesson learned:
I'm setting a new rule for my strategy, and that is to have a pre-determined entry point and use a limit order for entry to avoid this type of bad execution in the future.

Edited Wednesday at 04:55 PM by Stevecb06

[Stevecb06 6]

11-14-24

Summary:
One solid trade today that got me back to about where I was before my red day yesterday.  This one felt about as easy as it gets.  Disclaimer - this trade was done in my paper trade account since I was out of PDT trades in my actual small account.  I don't prefer paper trading, but I want to continue to 'get my reps in' to determine if this strategy is profitable or not.  I'll include my paper trades in with my P&L since I am using the same risk in both accounts.

P&L Today = +$1.54

Total P&L for November = +$1.60

Trade Plan:

OSCR popped up on the near HOD scanner.  I took a look and saw that it was building a very nice looking VCP/Ascending Triangle pattern.  I continued to watch as it broke the high of day.  I was a little hesitant on entry because of the failed breakout I got caught in yesterday, so this time I waited for a break and retest.
Entry:

After breaking the HOD, it pulled back to an area that had support both from previous resistance, and the 20ema.  I saw buying support at this area and got in as soon as it started making its way back up.
Profit Taking:

I took my first bit of profit at only about +1R because I did my math wrong and thought I was at +2R.  Oops!  I took off another share at the true +2R, then another at about +3R.  I decided to leave my last remaining share as a runner.
Exit:

I originally planned to let my last share ride with a stop loss under the 20ema, but the price just kept going up and I decided to sell into strength instead.  I let go of my last share at about +6R

[Stevecb06 6]

11-15-24

Summary:
No trades today.  There was just too much selling pressure, and being able to mostly only trade long, I just sat on my hands.  I watched a few potential setups but none of them seemed to have the momentum needed to really breakout, so I passed on everything.  I am considering today a win in terms of discipline and psychology.