Greg L's Trading Journal - Full Transparency 2019 Live

Greg · January 22, 2019

On 1/17/2019 at 8:17 PM, TommyK667 said:

Greg, the following is just my feedback so I apologize in advance if it rubs you in the wrong way. I'm also only on sim so you could just totally disregard what I have to say if you want.

First of all, congrats on the baby! But having to taking care of a baby will directly increase your stress levels due to lack of quality sleep, and that would directly impact your ability to control your emotions and impulsiveness, so maybe it's best if you could find a way to ground yourself first before you start trading, whatever ways it might be (eg. meditation, deep long inhales and exhales, exercises, stretches, cold water on face etc)

In my opinion if you are still a developing trader, maybe it's best to stay away from mega caps, or stocks that are higher priced. Yes you might win once or twice, but most of the time you might get shaked out and your stop loss wouldn't be able to handle that (since their stop losses are so big), worst if you don't execute your stop loss. Maybe focusing on trading these stocks that you can't get good entries with is somehow fueling your current predicament?

I am interested in knowing what concrete plans you have in tackling these discipline problems? For me I have my journal in a detailed spreadsheet, explaining every trade I took the whys and what, and what I learned from that trade etc. Also like Carlos's journal, I write what I did well that day, and what needs improvement (instead of "what I did wrong"), and mood, etc. Every morning premarket I re read them, and remind myself what I need to control myself in doing the most and what my goals (skill and psychology-wise, not money) are for that day. I also limit myself now to $10-$50 stocks and small shares, just for the sake of practicing my skills, because there's no point in buying AAPL now if I'm not ready, and I won't even buy it if I go live tomorrow (well I could, but most likely I will get stopped multiple times and start a revenge trade cycle).

Again, I apologize for the blunt feedback, we all have a hard time to control the psychology part, but because I have experienced those moments and choices too, I just wanted to chime in. Good luck!

Tommy, I am 100% ok with all feedback and comments.

I definitely need to work on my emotions with the newborn. This morning I was frustrated with the lack of sleep and I shouldn't have traded today. I knew it before I started, but I went ahead and traded anyways. This was a big mistake and will be a thing that I check daily.

As far as the larger stocks go, I do adjust my share size accordingly. If I can tolerate a $30 loss then I will take 100 shares of AAPL which a normal large move could be 30 cents in a minute which is my $30. If I am trading MU I will take maybe 300 shares because I normal large move will be 10 cents in a minute. Both of these trades will give me $30 loss on large normal move as long as I stop out appropriately. ( I just need to make sure I stop out! )

As far as my weakness go, I do track them in a journal, and I do need to tackle them one by one. I was taking an approach to fix it all at once, but it becoming clear that it hasn't been working and I need to go problem by problem. I do keep track of a journal, I use tradervue and they allow you to tag trades. For instance some of my tags are double down, broke stop loss, gambling. I can search by tag and see how much in $$ each problem is costing me. What I plan to start doing going forward is to open up my tags every morning before I trade so I can see that doubling down has cost me $XXX, breaking my stop loss cost me $XXX and so on. I haven't been doing a good job of holding myself accountable and I think reminding myself each morning that I have loss $1000s on these problems could point me in the right direction.

On 1/17/2019 at 8:46 PM, Mike B said:

Greg,

Just my recommendation, but be very cautious adding to a losing trade. Although it worked out for you this time it could have ran against you. Not sure if you watched Andrew's trade on Yelp a few months back, but it illustrates how adding to a losing trade can go really wrong.

Mike, I do remember the Yelp trade and I have to say that doubling down on my losers has become a really big problem for me.

I had to add DAS Risk controls to auto stop if I go to $90 loss on a trade. This should prevent the big big meltdowns. I have had a few of them.

I also unfortunately have a set of rules in my head for what to do if I have added to my losing positions. I must stop out at break even or near break even for a small loss if there is a clearer exit point. There have been times, where I have turned losers into winners. I have had trades where I have significantly passed my max loss and had those turn into winners. It isn't a good feeling either way.

Doubling down is my biggest problem and I have had many days ruined by one bad trade that I couldn't/wouldn't get out of.

The doubling down issue, wasn't a problem until a few months after going live. I never did it in sim, but once I did it once or twice live, and it turned a losing trade into a break even/winning trade, I couldn't stop it. I know its wrong, and not a successful habit to have while trading, but it is a newer problem that I am working on removing.

I am obviously an overtrader, so when I first started trading, I would quickly get out of the trade, knowing that I could reenter when the stock presented another opportunity. I had no issue with breaking my stop loss, or doubling down. When I went to correct my overtrading habit, by placing a total trades limit for the day, that is when these habits came up.

At the time, my thinking was that this is one of my X trades for the day, so I didn't want to stop out early, or let a trade go to waste. I sat in the losing trades or even worse, I added to them. I decided to get rid of the total trade limit in a day rule but I carried the stop loss breaking and doubling down habits with me. I have a hard time accepting a losing stock, and that I think is the next piece of the puzzle for me.

I need to accept that losing is going to happen and that it is normal to have a loser. Nobody is batting 1.000. It is normal to be wrong, and that I'm not going to win every trade. When I can accept losing, I then can accept stopping out appropriately and not adding to a loser. I can let the losers be losers and move on.

Greg · January 23, 2019

Jan 23

P&L After Commissions: $143

Trades: 10

Shorts: 6/10 (60%)

Did I walk away on my Own: Yes - Hit Profit Goal

My goal for today was to go slower in the open. I dont have to take every trade I see. I had to remind myself that there are going to be thousands of trading opportunities today and I'm going to miss 99% of them. I dont need to hop on the first one I see. I have time and I can afford to be selective. I wanted to make sure that I took good favorable setups. I am proud of how I traded in the morning. I took 5 trades in the first hour and half. I am very ok with that pace, and I was fairly selective with what I took. I did go a little crazy at the end of the day. Took 5 trades in about 40 minutes. Only 4 winners today, but I did a good job of keeping the winners significantly bigger than the losers. It was a profitable day and much better than trading days of the past.

$PTCT - Broke my stop loss on this trade. I thought this would be a pullback on the ORB and a great spot to enter. It was holding below the EMAs on the 1 min chart and I thought there would be some good resistance where I entered at $30. It blew right through $30 and I was ready to exit on a pullback. The stock was very strong and shot up 35 cents or so. My stop loss was $35.10ish. Basically above the 1 min moving averages. Broke my stop loss big time and when it came back near my entry, I decided to exit. I wasn't going to wait and find out what it did at VWAP. I was ok taking the loss there. The stock ending up coming down, but I was just happy to be out.

$QCOM - Found this on the Scanner. Took two stabs at this one. I got out very quickly on the first trade (13 seconds). I had an idea that it might stall there, but I since it broke a few pennies up against me, I got scared and exited. It was a much riskier trade at that point. After a few minutes, it clearly could not break the 50SMA so I went ahead and took it short. Took 200 shares and did a good job of holding a chunk of shares when it reached the bottom. I got $100 on a 72 cent move.

$FB - I took FB short when it reached the 50SMA. I put in on my list of stocks that could be potential reversals. I saw this stock making its move up from the bottom, for whatever reason it didn't look like a reversal. It happened so quickly and its not something you usually see. I treated this as a failed reversal when it had trouble breaking above the 50SMA. I took it short there. My entry was $145.88 and my stop was a break above $146. I took a smaller share size since I wasn't super confident. 75 shares. I took some profit right away and waited for it to drop down to $145.20 and then $145 to fully exit. I tried to hold the final shares for the break of $145, but it didnt do that and didn't look like it would so I exited my position fully.

$PG - I love taking reversals when the price has broken the 50SMA and then comes back to retest it. I love my entry for the long on this even though it didnt work out. The R/R wasn't the best since the target is usually VWAP and the price action was already fairly close to the VWAP. It broke under the 50SMA and thats my cue to exit. I waited for the pullback to the 50SMA to attempt to minimize the loss and I exited. At that time, it felt like a short to me, so I went short. I did take a little too many shares on both the long (250) and short (225). I thought the stock was moving a little slower than it was. Again I think I did pretty good job of holding for profit. I took some almost right away and then waited for the push down to $94. I had some limit orders set and it filled when it made that large flash push down.

$FB - Again these are the reversals that I love to take. I put a limit order in for $145.01. My mindset at this point since I was at goal, was that if it fills, it fills. If it doesn't, it doesnt. Stop was under $145. Tight stop. I was feeling good about the day and didn't want to lose profits here so I exited the trade and scalped a few dollars. At that point, I knew I was done for the day and ti would be better to just call it.

Overall did a much better job with trade selection and did a better job of holding my winning trades to maximize my profits. I need to continue to be strict with myself before trading starts and I need to constantly remind myself of what the rules are when I am trading.

Greg · January 25, 2019

Jan 24

P&L After Commissions: $21

Trades: 10

Shorts: 8/10 80%

Did I Walk Away On My Own: Yes

This was an ok day for me. I didn't trade well at all but was slightly positive. I had a terrible terrible trade with AAPL. My emotions got me and I refused to take a simple $10 loss. It ended up costing me $85 and DAS Stopped me out of the trade. My big trade of XLNX wasn't great trading either. As you can see my daily P&L chart is not pretty. I took a lot of chop and exited with small wins and losses, I'm going to share the XLNX trade and the AAPL trade.

$XLNX - This was a good trade with terrible trade management. This was the longest I've ever held a winning trade so I happy with that. (2 Hours 24 min) I did get to practice some patience, but my greed got a hold of me. The stock made a big move in my direction and I had my target set at VWAP which was a $3 move. I had my limit order set and was ready to hit this one big, and that was my big mistake of the day. I was very comfortable in this trade and I didn't see it going against me. I didn't take profit when it stalled because I wanted VWAP and I wanted it bad. It started to push back up, but I wasn't that worried about it, because I just felt that I had this one. It got back to my break even and I didn't exit the trade like I was supposed to. The stock kept going and went about $.80 past my break even. I waited in it which was very terrible trade management. I easily could have exited early for a small profit and should have exited at break even. I kept holding and saw that again it looked like it would reverse. I added to my position at that point, just so I can say that I wasn't just staying in this trade and getting lucky, but I thought it was a reversal. I was lucky that the stock didn't just keep going against me. If I wasn't already in this trade, I would have taken this reversal here. It took a little over an hour to finally get to VWAP which was higher at this point. I would be very very proud if I just entered at the second half of this trade. I love my entry and I really happy with how I took profits. No complaints starting with the short slightly before noon.

Explaining my original entry. I saw this stock being a short. I wanted to target $107 as my entry for a short, but I was worried that the stock would make its move there, so I took a small share size around $106.50 (25 shares). Added 50 shares at my original target entry. Maybe could have waited a little long to enter instead of entering where I did, A little more confirmation that it would stop at $107 would have been better.

First half of trade - 1 min

Second Half - 1 min - Exited final postion where I did because it was the 50SMA on the 5 min.

5 min

$AAPL - My other major trade of the day was AAPL. This was a disgusting trade. I deserve everything I got in this trade. My emotions got to me on this one as well. The trade itself wasn't good, but the trade management was worse. I wanted to trend trade AAPL, and when it didn't go my way, I couldn't stop out. I did add to my position two times, and there was no reason to do that. I took this trade at around 11:30, this is when my XLNX trade was going against me. I refused to lose on this trade while I was also losing on XLNX. I easily could have stopped out for $10-$12, but I was being so dumb. This trade cost me my day, and I hate that I did it, but I need to keep remembering this feeling. Dumb emotional trade all around. I did get autostopped out for a $85 loss by DAS. Very ashamed of this one.

If I can't be handling a $10 loss on a trade, then I can't be in a trade. Its almost that easy. I need to remember how this feels, and when I feel this way, I just need to stop out.

This wasn't a pretty day of trading. Couldn't catch any clean moves except for the second half of the XLNX trade. The AAPL trade basically wiped it out and I had a small $21 profit for the day. One trade ruined my entire day. Just dumb mistakes. I need to respect my stop losses in order to be consistently profitable.

Greg · January 29, 2019

Jan 25th

P&L After Commissions: -$172

Trades: 15

Shorts: 11/15 73%

Did I Walk Away On My Own: No - Max Loss

This was a terrible day. I started with two really bad trades and broke my rules right off the bat. I hit max loss in the first 15 minutes. I was emotionally wrecked at that point and I should have quit there. I just didn't want to end my day after 15 minutes and go into the weekend like this. Instead I kept trading, I was doing ok, not great. I opened my daily P&L after the first two trades and I traded based off my P&L the rest of the day. My mentality changed, I didn't take proper profits. I traded scared and I traded to hit homeruns. Mentally it was very weird. I had quite a few decent winners, that turned into just break even trades because I wanted each one to be the trade that gets me back to break even or at least take a big chunk off my losses. I did claw my way back to a manageable red day, but I wanted break even and risked everything to get it. I knew I was close to approaching my daily share limit. I have a 4000 share limit so near the end of my trading I checked to see how many shares I had traded so far, and made my last trade of the day based off the number of shares I had and how I could maximize them. I hit max loss on the last trade of the day, on a gamble entry.

It was a red day from the beginning and the big drop off was me trying too too hard to get back to B/E.

I highlighted my 3 killer losing trades in red.

I highlighted in Yellow my trades that were decent winning trades that I let turn into break even trades. MFE is the max profit I could have had if I sold at the best possible time in the trade. Often, I ended up with a tiny fraction of what the potential winnings could have been.

In the recap I am going to go more into my mental state than the trading technicals and what I saw. I will posting the trades that had the biggest emotional impact on me.

1 - $MU

I traded this one before the 5 minute mark. I normally dont' do that and I normally don't have any urge to trade early. I saw that someone said they got squeezed on MU so I went to take a look. It looked like a long to me at that point and I took right at $38. I'm not sure why I felt compelled to take this trade. If I didn't read that comment about someone else taking then I wouldn't gotten in if I just was watching MU on my own.

I can be really stubborn when I am in a trade. When I am in a stock, I often times take a wait and see approach which I should never do. I didn't feel great about this one and I considered fully exiting when I took first profit, but I wanted the trade to be more than it was. I couldn't accept a loser on the first trade of the day so I doubled down and then finally got out a very terrible point to exit. My trade idea was broken and I should have exited, but there was a significant level that the stock bounced off of there. On the first trade of the day, I felt that the market was out to get me.

2 - $SBUX

I took another shot at an ORB. This one also went against me and instead of getting out, I doubled down. I easily could have exited around the 9:46/47 mark for a $15 loss or so. I was being very dumb and letting my emotions take control. If I did exit there, I would have been down $100 which would have been a terrible start for the day and I didn't want that so I stayed in the trade, hoping it would turn around. It popped up and it hit my max loss on the trade and auto stopped me out for a $80 loss. I instead was down $160 to start my day.

The thing with this pattern is that it has gotten me time and time again. I've seen these where it opens down and comes back to test VWAP. I haven't figured out exactly what the criteria or setup is but I need to be taking these long. I have been burned too many times by seeing this exact pattern and shorting it again. I have the setup in my head as a 5 min ORB, it comes back to test VWAP and doesn't immediately push off, instead it will make a ABCD pattern with B pushing on VWAP. If the stock does break VWAP the push upward is usually huge. If you can enter long during the consolidation the risk/reward is very good. I'm not sure if Andrew teaches this one anywhere, but it something that I noticed. My only fear and why I dont take this pattern more is because you will have to take it long under VWAP. I will be looking out for it more.

So I did see the pattern when I did take SBUX, I just can't help taking it short near VWAP when it opened down. I need to flip my mentality on this type of trade and I should have known that if if it were to break up that It could run quite a bit.

3. $WDC

I felt I had a great entry on $WDC, right at $44 and strong resistance on the 1 min and 5 min. I felt I had a winner in my mind. I took some profit right away to feel comfortable and then it popped up on me. I took a larger share size than I would have. I was trying to make my money back. I took 100 shares even though I knew this stock could easily move 50 cents a minute. It did go about 30 cents against me and would have been really close to reaching my max loss on the day if it popped up again. I got scared and decided to look for a exit. The stock was coming back down and I set the limit right at my entry. Of course the stock would break down and over the next few minutes would have gone 75 cents in my direction and almost $2 in my direction over the next 15 minutes. I got scared out this trade.

4. $ABBV

I took a great entry on a reversal on ABBV. It was holding $80 and couldn't break below. It went about 10 cents in my favor and for whatever reason I got scared out of this trade. I exit the trade and in the next minute it pops and the next 5 minutes hits VWAP. Exactly the move I wanted from it. Its damaging to my mentality knowing that I took the right trade, the entry and the trade idea was great. I just didn't manage it properly. There were literally no reasons or signals to exit. It was staying above my entry point.

I was already mentally hurt on the day and I feel this one really added to it. The market got me good today.

5. $AAPL. The best trade of the day for me. This one was an easy short. I went 150 shares instead of my normal 100. Did a decent job with the profits and even added to my trade on the way down. I still had 50 shares left after it bounced off VWAP and saw it forming an ABCD away from VWAP. I didn't exit again because I was trading my P&L instead of the price action. I should have seen it coming that the stock was strong, I instead got stopped out of the trade by DAS when NVDA hit my max realized + unrealized loss later on.

If I didn't get stopped out by NVDA, I probably would have just let this thing ride out anyways instead of properly trading it.

6. $WDC

Another trade where I messed up. Just adding to broken mentality for the day. I took it short, got stopped out for a small loss and then reentered. It was a short and I mean to take 25% on the first profit taking. I'm not sure what happened, I must have not changed the share size, and I exited the position fully. I was trying to set a limit order because the spread wasn't great. I was not happy because I knew I had a big winner on this one. More and more damage was being done to my mentality because I felt even when I did things right, I couldn't do things right. Things were just going to go against me today.

Believe it or not, I did put a limit short at the 50SMA $42.74 to be exact, just in case it came back up to test the 50SMA. It did do just that, but I pulled the order because I felt if the stock was going to jump up 40 cents then I shouldn't be in because who knows what it would do next. Next thing you know it goes right up to the 50SMA and right back down. I was very angry and felt I was being teased. Emotionally and mentally I was gone.

If I stayed in this trade or if I got my second entry, I would have broken even on the day. I'm not as upset with myself for not keeping my limit order in, as much as I am that I hotkey errored my way out of a big winner.

7 $NVDA

I made the big mistake of checking my shares that I had for the day. I believe I was something at 3890 out of my 4000 limit. I had 100 shares to play so I went with NVDA knowing that it could make a huge move and I could really make the 100 shares count. The second trade is the one where I checked my shares on the day. I took it short, hoping it would go back to about $153.50 where it was about 15 minutes ago. I thought it had a good shot at that and getting $50 on my last 100 shares would have put me at maybe -$25 on the day.

This was a bad trade and I took it for all the wrong reasons. It wasn't a short and I because it was my last trade, I let it run. It was anything but a short. When I was done with this trade, my day would be over. I just didn't care at that point. I let it go, hoping that it would bounce off the previous day mark. I doubled my normal share size for this gamble and it cost me. This was a pure gamble.

Mentally and emotionally I was ruined on this day. I felt that I couldn't make the right move, whether it was staying in a trade to let it run a little or exiting to respect my tight stop loss. Either way, it would have been the wrong move. I felt the market was out to get me and had a terrible day of trading overall. I need to remember what it feels like on a day like this. Where you dont have it, and you shouldn't be trading. I need to learn to walk away when I am not in the right emotional or mental state.

Greg · January 29, 2019

Jan 28th

P&L After Commissions: -$37

Trades: 16

Shorts: 13/16 81%

Did I Walk Away On My Own: No - Max Share Limit Stop Out

This post is one day late. I will catch up with my recaps today.

It seems that lately, I've been starting off red where by mid day, I am trying to just get myself back to break even instead of trying to hit goal for the day. This was another day like that. I was out of control from the beginning. I wanted to start this week off right and trade patiently with no FOMO and to wait for my setups. As soon as I took a bad SQ trade, the over trading and revenge trading began. Again I had some good setups where I did not maximize profits, instead I tried to have them dig me out of the hole that I'm in and make me positive. I need to just take what the market gives.

I don't really have a lot of exciting trades for this day. I got chopped around quite a bit, and I had some ok winners which equaled out the max loss losers.

SQ Messed me up from the start.

I took a big loss on the trade and then let a winner turn into a loser and stopped out before I had another winner. I circled the 3 individual trades in this chart.

The first trade, I should have stopped out earlier. I don't mind the entry. I love taking the stock when it breaks the 50SMA or 200SMA and retest it. The retest offers a great risk reward if you stop out. I got the entry I would have liked, but I didn't stop when it broke under. I only should have lost 5 - 10 cents max on this trade. Instead I covered a partial when it hit the previous day mark and the rest when it came back to VWAP. I then went short. I lost $45 on this trade which is about the most I want to lose on a trade. The MAE on this trade is $80 which is really bad for me.

My second trade was short. Again I feel this is a good entry. It never really went against me and I got the push down back to previous day close. I took a partial profit there expecting it to go farther done. It came back to VWAP and I added to my position. I probably shouldn't have done that. It was a small size. It then popped up against me, I intended to exit, but made a hotkey error. I doubled my position, but then immediately closed the entire position.

The 3rd entry was a long. I thought it would hold VWAP this time. It never feels good to trade a stock 3 times in a row, swapping your position each time. So I exited quickly for a small gain.

$CGC - My best trade of the day. Took this as a VWAP break and break of all trend lines. Very safe and easy trade.

$AAPL - This one got me good, I thought for sure this was going to be a VWAP break and a easy short. I took a larger entry than normal (150 shares), but I didn't get the exact entry that I wanted. The stock popped up a little and I added to my entry which gave me double my normal share size. I didn't like the price action, so I exited half my position for a small loss and the rest when it popped up. I had the right idea for the trade, just the timing was wrong.

I also started doing this fairly often now. I will exit partially instead of fully exiting a losing position. Very rarely will it ever work out for me, and when I have the feeling that I need to exit, I need to trust myself and exit the position fully instead of exiting some and hoping the stock goes my way. I think this is me admitting that I am wrong, but still holding hope (gambling) that the stock will move for me.

$FB

I was getting chopped up all day. A lot of my positions ended up being less than $10 gain or loss. I was worried about getting chopped up, so when I took this FB short I decided that I wanted to exit this position quickly. I got in this trade at the perfect time, never went against me. I just exited too quickly because I wanted to be better at profit taking. Seems that when I exit quickly, the stock continues moving, when I hold, the stock bounces.

I captured max 40 cents out of a potential $1 move. Not Good!

$SPY - Last major trade of the day was two trades on SPY at 10:50 and 10:54 This trade looked very similar to the AAPL setup that I took earlier. I just did a better job of stopping out of this one. It popped up and I found a great and much better entry. Again this never went against me and made a huge drop. I tried to wait patiently on profit taking and did an ok job. Stock moved 70 cents and I captured about $40 profit on 100 shares. Definitely could have been better at the profit taking, but considering that I missed the bottom, I am not upset by any means with this trade.

Also pictured is a quick scalp at 10:40. (Dumb and risky trade, but at least I'm happy that I got out)

Overall a very choppy trade. A big loss in the beginning and a couple other decent sized losses because I was slow at stopping out. I didn't trade great and I didn't trade poorly. I did make some mistakes that hurt my P&L

Edited January 29, 2019 by Greg
Typos

Greg · January 30, 2019

Jan 29th

P&L After Commissions: -$30

Trades: 16

Shorts: 12/16 75%

Did I Walk Away On My Own: No - Max Share Limit Stop Out

Man oh Man, today was very interesting. I set out today to be in control of my FOMO. I believe that FOMO is the root of all of my problems. I will make a separate post regarding this. When I learn to control my FOMO, I will be a great trader. This is what I will be working towards going forward.

I wanted to be in control today, I wanted to make sure that I started off green instead of red on the first trade, and I wanted to make sure I took A1 setups.

I absolutely crushed my first few trades of the day, I have to say that this is probably the best I could trade. I was very happy with both my wins and my losses. I had ok wins, I didn't take anything that made an extreme move, but I did get winners and I had some great exits on my losers. I traded almost perfectly for how I trade and I couldn't have been happier.

The problem was today was a tale of two halves. I was in control and I did not have any FOMO. It was until I hit my goal and continued trading that I triggered the FOMO and the day spiraled out of control.

The goal of the day was controlling FOMO and being in control of my trading. It got off to such a great start. I missed a huge move by literally one penny. I put my limit order in on a SQ trade. This was my first trade attempt of the day. I had it set to $71.98 and I believe it hit $71.97. The next candle it dropped $1.5. (not pictured, I wanted to capture the screenshot and remove my limit order) That move alone would have made my day. I missed the trade, which is annoying, but it didn't upset me. I cleared my head and I let it go. I continued to patiently wait for entries. I am so proud of myself for doing that. The screen shot doesn't show it, but the stock dropped down to $70.50 on that very candle.

I didn't get in on this trade, but I survived. I didn't let it bother me. I did a great job of controlling my emotions, but I did hit my limit, and my FOMO did kick in during the second half of my trading. The P&L chart is disheartening for today, but I will overcome it. I am proud of how I handled SQ and I will learn from this. This isn't the first time where I hit my goal and turned into a red day, and probably not my last, but I will take lessons from this day.

I boxed the trades in Green where I was in a great mindset. As you can see in the blue box. My winners never went against me. 2 trades have a MAE of $0 and one has a MAE of $2. This is amazing for the MFE and profit I got on these trades.

I was very quick to exit my losers. I had two losers in the morning, I exited them in 45 seconds at 18 seconds respectively for very minor losses.

The 3 trades in the Green but not blue boxed are where after these the FOMO kicks in. I hit my goal with the blue boxed trades, but I was feeling good, trading good, and I wanted one more win. I will show you these trades later, and you will see how they got to me.

Yellow is where I started to lose control. I wasn't trading well. I didn't stop out on VZ (held that trade for 1 hr 40 min).

Red is where I have lost control. You can see the huge difference in the blue box in the red compared to the green. These stocks never went in my direction. The most they ever did was $6. They all went $25-$44 against me. The difference between my trading here is night and day. On both of these tickers, I swapped my position. The trading was downright bad. It was desperate trading.

NFLX is double boxed red because my emotions completely took over. I have Das Risk controls that stop me out at 4000 shares. I was still in my VZ trade at the time and I checked to see that I could take 150 shares still before risk controls stop me. I do keep my share count hidden, but when I go crazy, I will check. My emotions took over and I went straight to TSLA and NFLX, knowing that there would probably be a great opportunity to make my 150 shares really count. I normally take less than 50 shares or so if I trade these, so I wasn't thinking rationally. You can see the huge swings of $95 MFE and a MAE of $65.

The Green Box

Caught a nice $1 move on NVDA. Thought it would break down farther. Exited slightly before break even.

$FB - I asked myself, Is this a reversal? I said no it wasn't and decided that it was a great R/R short. I took at the whole number and the 20EMA. I would stop out for pennies or catch a $1 move. I added to my position on another pullback. Wasn't the best entry but still profitable.

AAPL - Broke below and held below VWAP.

This is where things start to fall apart. I didn't trade poorly (at least in regards to my P&L). I took two shorts, both were fairly good, but I exited both prematurely before the big moves that happened. Both had big moves happen very shortly after. SPY dropped about a $1 which is huge and NVDA dropped about $3. I know with the day I was having I would have taken profits on those earlier and I wouldn't have captured everything, but it did trigger me that I had big winning trades twice and I let them go. The FOMO kicked it and it was strong.

The Yellow Box

Here is where I started to trade emotionally.

My AAPL trade wasn't the worst. Got a little scared and got out of the first attempt. Got back in and it dropped. I was very cautious with profit taking. I really wanted a bigger move. For the 3 place of profit taking I covered half my shares. Got out the rest at B/E. Only made $14 on 100 shares on a stock that moved about 50 cents.

VZ - I lost complete control. I dont mind the entry, but I didn't have a good feeling with the price action, but I didn't want to stop out early like I did on SPY and NVDA earlier today. I decided to hold. I added slightly to my position and when it broke upwards, it broke hard. I made this same mistake yesterday and I didn't learn from it. It came back to where I thought would be a good point to partially exit. If I feel that way, I need to exit fully. I need to understand, its ok if the stock continues to come down after I exit. I need to protect my P&L. I sold 2/3rds of my position there. This is what I need to learn from this trade! I traded it very poorly otherwise. Doubled down multiple times and held with no strategy, just hoping it would come back down. I would have continued holding, but I had to exit the house.

The Red Box

These 4 trades are absolutely just sloppy gambles. The SQ long was really bad. I like to take it when ti breaks the 50SMA, but I took this below the 50SMA. This wasn't a good entry. I also need to exit even if that means exiting the trade a few seconds after getting in. Then I position swapped it short. I did the same thing with FB right after. If you check the overview for the day. It took me 10 seconds after exiting SQ to enter the FB trade. This is not in control trading!

Same thing as SQ, broke the 50. Entered on the Restest. Exit and Then took it short.

Red Double Box

NFLX - Not the worst trade. I took it short. It broke under $330. I originally entered with 100 shares, felt confident and added 50 more. Stock moved my way, and held below the 50SMA. Took some great profits and I had my limit set thinking it would run down. It popped up on me and I decided to exit the rest at slightly above B/E. Broke even on this trade.

The trade itself is whatevers. Not horrible, not great in terms of price action. The problem with this trade was the FILG attitude I had because I was on my last trade of the day. I took 3x my normal share size on NFLX and I was trading solely for my P&L. I had great gains, but got greedy and wanted more. I threw all caution to the wind, and it was super disappointing.

This day had everything. I started off so well. I traded perfectly. I took great trades and exited very well on my losers. (Maybe I shouldn't even have been in those losers in the first place) It wasn't until I missed out on big moves that didn't even hurt my P&L, that I started to trade poorly. I need to control my FOMO. First I missed the big moves, then I had the VZ trade go against me hard. Those two combined set me off. When I lose control emotionally, I do not recover until the next day. I need to always be monitoring my FOMO level. I need to recognize when I am getting triggered and what it is doing it to me. When I lose control of my emotions, I need to walk away for the day.

When I learn to control my FOMO and my emotions, I will be a great trader.

Edited January 30, 2019 by Greg

Carlos M. · January 30, 2019

Hey Greg, hope you did better today and that you were able to control the FOMO. This is why is so important to stop trading once you hit goal.
I no longer trade after a certain time or after certain amount of trades just because I know I can easily give it back or make a small red day worse. Why bother when tomorrow morning we can get more opportunities to trade good setups.

Nice Journal as well. Keep it up.

Greg · January 31, 2019

51 minutes ago, Carlos M. said:

Hey Greg, hope you did better today and that you were able to control the FOMO. This is why is so important to stop trading once you hit goal.
I no longer trade after a certain time or after certain amount of trades just because I know I can easily give it back or make a small red day worse. Why bother when tomorrow morning we can get more opportunities to trade good setups.

Nice Journal as well. Keep it up.

Thanks Carlos. Unfortunately, I hit goal again today (twice) but finished at about 50% of goal. I'm a slow learner!

When I'm up early in the trading day, the greed of having a "really green day" outweighs the fear of losing some or all of the profits. I need to remember the market is scary and I need to take my money and run when I hit my goal.

Greg · January 31, 2019

Jan 30th

P&L After Commissions: $57

Trades: 18

Shorts: 14/18 77%

Did I Walk Away On My Own: No - Max Share Limit Stop Out

You don't have to trade perfectly to be green, you just can't trade poorly. A lot of my red days are from having one or multiple big losers. If I can avoid the losers and follow my rules, I dont see why I can't break even or go green consistently.

My confidence has been up lately, I've been doing a fantastic job in the first 30 minutes of trading or so. I've been getting good size winners and keeping losers small. My winners have been barely going against me, and I'm setting and keeping very tight stops on my losers. Today was more of the same. I hit my goal early, I just didn't want to stop trading. My goal is $120-$150. The past two days I hit $120, but kept trading. The idea of having a $200 day really entices me. I need to understand that I set my goals when my mind is thinking rationally and that I should be satisfied with my day and trading if I hit my goal.

Again my MAE in the morning trades has been perfect or near it. I've entering right when the stock makes the move, and I'm really proud of that.

$MU - Took an ORB on MU. Dropped very nicely as soon as I got in, I just didn't take much profits. I was holding for the break of the 200SMA on the 1 min and a much bigger move to follow. I exited at B/E. Even though my MFE was about $50 and I captured only $9 of it, I am happy with how I traded. The stock didn't make the move I wanted, but I am happy with the small profit I took, and exiting appropriately. A green trade and a win in my book!

$FB - FB was my big winner of the morning. I took it short 3 times. I stopped out the first time, when it appeared to break back above VWAP.

For the second trade, I saw that it was coming back down below VWAP. I normally do limit orders for the most part, for this one, for whatever reason I did a market order to get in. I regretted it a little as soon as I hit the button, because I did feel that I didn't follow my strategy of placing a limit order for a precise entry. I didn't get a great fill on this and it was worse entry than the first trade, but the stock instantly dropped, I covered some and decided that because it moved so fast, that I should exit completely which I did. I was in the trade for 9 seconds total and made $87. It happened so fast, that it was a little hard to process, I'm assuming I saw something and my subconscious took over and hit the button for me.

The third trade was a 50SMA break. I take these daily where they break the 50SMA and I enter when it retest. In this case the stop would have been above VWAP, I felt it was a great R/R. Stock again moved fairly quickly. 50 cents in the candle that I entered. Got out the rest when it couldn't break the 200SMA.

$AAPL - My first entry into AAPL was a 50SMA Bounce. Seemed to be holding on the 1 min, so I thought it would make a good entry. It may not have been the best trade idea, but I have no problem with it. I just didn't stop out. My stop is usually on these the break of my trade idea, so in the case the break of the 50SMA. Since it was near the VWAP, I let it test to VWAP to see what happens. It broke through easily and I took a great exit considering the circumstances at VWAP. I took about a 30 cent loss on this.

Not a lot to say on the second AAPL trade. Saw weakness, took it short. Dropped right away, sold some hoping for the break of VWAP, but it popped back up and I got out.

$T - T was a easy reversal. Broke the 50SMA, came back to retest it. It was a large red candle, but my strategy is to take the retest of the 50SMA. Stop is below the 50 and price target is VWAP. Because I do have the tendency to break my stop loss, I am hesitant to trade stocks below $30. Usually I take 200- 400 shares, and what happens is I always let the stock move a few more pennies, and then a few more pennies when they are going against me. These pennies add up when you have a few hundred shares! I wasn't feeling great about taking something like this, so I did take profits early. I had about 100 shares of my 225 shares left when it got to VWAP. I didn't think it would keep going the way it did, so I just fully exited. Missed out on about half the potential profit.

$BABA - I know you aren't supposed to short super strong stocks, and I've been burned by it before, but I felt BABA was stalling at the top here. Decided to take a short, it was risky, and I definitely understand that. I took profits fairly quickly for that reason. First at $166 where it hit and held a few times. Then when it broke down and again when it hit the 50SMA. It broke through the 50 and the target was the previous day mark which it hit really nicely. I just didn't have the patience for it. Exited a little early.

$NVDA - Now for the bad trades. I was at about $150 at this point, which is my goal. My second time hitting goal for the day. I kept trading, because I felt good and $200 would have been really nice. The big mistake it seems like always is when I look at my share count for the day. I have a 4000 share limit, so I peaked to see what I had left. I had 150 shares so again like yesterday I wanted to make them count. I decided on NVDA and went for a VWAP break. It didn't hold, it pushed up above VWAP and I didn't exit when it broke my stop loss. My bad habit is letting my last trade run. I need to treat it the same as the first trade of the day. It finally got to a point when I couldn't hold anymore and I took a $60 loss. Knocking me down to about $90 on the day,.

Since it did break the 50SMa, I decided to enter with my last 50 shares long at that point. That went against me to and brought my daily P&L down to $75. Just like that I went from $150 to $75. Terrible risk management and turned a green goal day into a ok green day.

Lesson from today is easy. Stop when you hit goal. I am happy with how I traded. I loved my trades in the morning, and I am ok with getting chopped up mid day. At least for now, that means I am stopping out or exiting a trade fully when I lose confidence in it. I will take that for the time being.

Again I hit double dig trades and again above 15 trades. I do need to work on my selectivity of trades. Mid day is where I usually lose it, while the mornings are great. I believe this to be the case because before I start trading each day, I go over my goals and rules. It is fresh in my mind of what I am trying to do and achieve. It might be beneficial to review my notes again mid day.

Edited January 31, 2019 by Greg

Greg · January 31, 2019

Jan 31st

P&L After Commissions: -$204

Trades: 9

Did I Walk Away On My Own: No - Max Loss - Das Stop out

Traded so terribly today. I just didn't have it today. I took larger share sizes today, and I was impulsive and greedy. I didn't sleep well, but that is no excuse. If I'm going to trade I need to be ready to trade.

I dont know if It was just because I was tired and my poor poor trading, but I felt that the market was moving so fast. Everything was moving quickly today.

I didn't do anything right, and I am ashamed with how I traded. Could I have been any more wrong? Every trade I took went against me. 6 trades, never even went my way. The longest I was in a trade today was 3 minutes. No great setups. Just taking trades to trade. I need to be smarter tomorrow.

$FB - Took FB twice. First time I thought it would bounce so I went long. I knew this wasn't a setup that I wanted and the stock was moving so fast. I exited immediately after 4 seconds. The second trade I saw as a short. It moved about 50 cents. I took minimal profit and stopped out slightly after B/E. These trades were the best trades of the day.

AAPL - Saw it bounce off PDC twice. When I entered, it blew right through. I was being picky with my stop. I was trying to set a limit order, it never filled. Stocked moved up and I had to get out. For some reason, I took a larger share size on this trade and the trades after this. I normally take 100 shares on AAPL, but here I took 150. This clearly broke my trade idea of a PDC bounce, so I need to market order out of these trades instead of setting a limit and trying to pinch pennies. Could have cut this loss in half with an appropriate stop.

MSFT - Got Chopped up. I was indecisive. Kept switching my position. Took a large share size (200 shares) because MSFT has been traditionally a slower mover. Should have taken 100 shares here today since it was in play. I'm glad I at least stopped out properly on these.

PYPL - This is where it all went wrong. I took a reversal. It wasn't a great entry. It popped up against me. Again I took 200 shares. Maybe too much for PYPL today. I didn't respect my stops. I took the first short at $89. Should have stopped on the next candle over for a $20 loss. Let it go up a $70 loss and finally exited for a loss of $45. I didn't respect my stop.

It did make the move that I wanted it to make. I saw it bounce off VWAP and I thought I could get into it again. I revenged traded it on the second trade. I was down $100 or so on the day at this point. I saw it bounce off VWAP and drop back down to $88, so I took it at $88.47 (200 shares) and wanted to catch the drop back down. The plan was to sell all at $88 and get myself to break even for the day. I was trading my P&L and not the stock.

I got squeezed and I didn't stop out. I just didn't think PYPL could make a move that big like that. 50 cents for PYPL on one candle is a lot, so I just thought it had to stop before it got to where it did and pullback.

I didn't stop out on this trade. DAS risk controls stopped me out at $200 for the day (of course right at the top of the candle). I dont blame DAS. It was just poor trading on my part.

Normally when I have bad days, it is because I broke my stop loss and am being dumb. I was being dumb today. I was emotional. I traded very poorly. I shorted while the market is strong. On most of my bad days, I can at least be somewhat proud of my trade ideas and entries. Today I am not. I took bad trade after bad trade with bad entries all around. There isn't a whole lot to be proud of today. I will have to be better tomorrow.

rom30 · January 31, 2019

Greg,

I am sorry things did not work out today. A couple of weeks ago, I was having exactly the same issues that you show in your trades. I really mean exactly the same. Recently I had 5 days in a row losing $150/day. The only reason I only lost $150 is because I have account controls with DAS that stops me when I reach this $150 limit. I had a number of common trader issues. Not respecting STOP levels, over trading, revenge trading trying to recover loses, not being analytical on how to select trades, trying to catch ORB within the first 5 minutes of the open, etc.

I have taken some corrective actions that seems to be helping:

1- Every morning before trading, I hand write my rules for the day and keep the paper in front of me. It is important to hand write the rules. The human brain seems to process information better when the person hand writes it.

2- I modified my rules they are as follow:

A- Wait 10 minutes before taking my first trade.

B- Only take trades and setups that I am familiar with around the VWAP and have the potential of 1:3 or 1:2 Risk:Reward. I call these A+ setups.

C- Set the stop loss at my risk per trade limit (see risk management below) and respect the stops. I enforce this with STOP range orders.

D- Only take 2 trades maximum per day. If my first trade is a winner I stop for the day. If I lose on my first trade I will look for a second A+ setup. If I get stopped for a second time. I stop trading for the day.

E- I do not trade after 10:30. If I am already in a trade and it is going my way I stay with it.

3- My risk management strategy is the following:

Although, I have a fully funded account I only use 10% of my real equity to trade. If my account has $25,000. I use it as if I only have $2500 equity. So for trading purposes my equity is $2500. My broker gives me a 1:4 margin, so I really have $10,000 buying power to get shares. In other words when I trade stocks, I make sure that the number of share that I take can be obtained with $10,000 or less.

I have set myself a risk per trade limit of 1% of the equity. This means that with the $2500 equity, if I get stopped out I will lose $25. I use this risk per trade limit to determine how many share to get. For instance is a stock is $10/share, technically I can buy 1000 shares with my buying power. However, if this stock can move $0.10 against me and I have 1000 share, then I will lose $100 which is way over my risk per share. Thus for a $10/share stock with a potential loss of $0.10, I would only get 250 shares. Now if a stock is $100/share I could buy 100 shares with by buying power, but if this stock has the potential to drop $1, I will lose $100. In this case I would only get 25 shares. There are different ways to manage share size to stay within the risk management. Some people have a set number of shares based on the stock price and price action. When they build their watch list they know for each stock the proper size to take. Other people use hotkeys that automate the share size based on Ask price and buying power. I personally use hotkeys that I have created for this purpose.

I use STOP RANGE orders with my STOP LOSS at risk per trade ($25) and wins at 3 times risk ($75). If I make my $75 in my first trade, I stop trading for the day. If I get stopped on the first trade, I lose $25. In this case I look for another A+ Setup to trade. If I win that one at $75, then I will be up $50 for the day. If I lose my second trade, I will be down $50 for the day. I don't do more than 2 trades per day, I either my outcome is one of the following: +75, +50, -50. I use hard STOPs so, I don't let trades run against me. I also use hard stops for my target. So when I hit the 1:3 ration, I get out with a win. Sometimes on winning trades that look strong, I adjust my STOP and end up getting a 1:4 or 1:5 ratio. I use hotkey to set up to STOP orders.

In order to be successful with this risk management plan is important to identify A+ Setups that have the potential to give 1:3 risk:reward. Not only do you need to identify them, you also need to enter them at the right price that could potentially give that 1:3 ratio. If the trade does not meet these conditions, wit for it or look at another stock in your watch list. Don't settle for less. If you select trades like this, you will have few losing trade and the winning trades will yield enough to overcome your losing trades. Obviously, this is easier said than done. Selecting A+ trades come with practice. For me this is the trickiest part of trading. Right now this is my main area of focus where I want to improve.

This risk management works well with the daily rules. For instance having a rule of a maximum of two trades per day, forces me to look very hard for the A+ setups. Also, the 2 trade rule forces me to stop trading after. My theory is that in the long run I will be ahead. If my success rate at selecting a good trade is 3 out of 5 days (60%), in a week I can expect lose $100, but make $225 for a +$125 for the week. The better I get at selecting A+ Setups, the better it gets. Right now my main focus is identifying these A+ Setups and sticking to my rules. When I had those 5 losing days in a row, every single day I was up for the day but I continued trading and gave it all back and some more.

4- I don't use 1 Minute Charts anymore because they are too "noisy". The 2 Minute Charts allows me to identify A+ setups better.

5- At the end of the trading day, I look at my handwritten notes. Make remarks on what I did right and wrong. I save my notes as part of my trading journal. I also save my trades images with annotations of what went right and wrong. I also save my trade log. I review my journal to determine if I need to change my rules or risk management plan based on bad behavioral patterns that I identify.

These are my rules and risk management. They seem to be working for me but they may not work for everybody. I am sharing because it is always good to learn what other people are doing. You probably need to find what work for you.

Analyzing your trade with my strategy:

For your FB trade you may have had a different view is you only look at the price action after 9:40 AM. You would have seen a doji and waited a another couple of minutes, then you might have seen the price bounce from a support around $165.50. The 2 minute chart might have shown a different perspective that could have helped.

The AAPL trade was harder to see because it was trading in a narrow range from 9:35 AM until 9:45 AM. This period is a pure chop. In my mind when a stock is trading like this, it could go either way. I see these setups as a 50/50 chance. Not an A+ setup in my mind. Eventually it went up, but it could have gone down based on the indicators. When I see these chop patterns, I look for other stock to trade or wait a little longer. Following my rules, I would have stopped trading after AAPL, since I have a limit of two trades per day.

I think the MSFT might have been easier to read with a 2 minute chart. Although, it is still a hard one to read. In the 2 minute chart you might have seen a shorter candle from 9:50 to 9:52 this could have made you wait another 2 minutes to make a decision. Again, I would have not traded MSFT because I would have already hit my 2 trades per day limit.

On PYPL, I don't know if the 2 Min. would have shown better direction. Reversals are very tricky. I stay away from them because I usually lose on them. I like trading around the VWAP especially between 9:40 and 10:00 AM. After 10:00 AM, the patterns seem to change and I don't know how to trade them. I have taken some successful reversal towards VWAP, but most of the time I can't figure out the right time to enter a trade and end up getting chopped in a move like your first PYPL trade. Definitively, I would have not traded PYPL becuase of 2 trade limit, it is late in the morning, and it is not the a setup that do well with.

I hope this helps.

Greg · February 1, 2019

I'm going to be posting my goals for Feb 2019. My goals are going to be difficult for me to reach, and are going to be secondary goals to trading well. I'm not going to alter my trading in an extreme way to meet my goals. I will trade to the best of my abilities with my goals in mind. For Example, I won't purposely take a 1 trade and it call it a day in order to bring my average trade count down,

February 2019 Smart Goals

Average $75/Day

This is going to be a hard goal for me to reach. My average daily goal is $120-$150. Not everyday is going to hit goal and there are going to be days where I lose money. If I can follow my rules and trade well, this is achievable.

Average 8 trades or less a day

I am an overtrader. No getting around that. I will enter trades when I see them, and I dont have a problem with that. I do need to work on my selectivity though. In Jan 2019 I averaged 16 trades a day. I feel 8 trades will be ideal for my trading style and what I am trying to accomplish.

No Max Loss Days ($150)

I have adjusted my risk controls for Feb and dropped my Max loss down to $150 from $200. This includes DAS' commission structure. I need to learn that it is ok to have losing days. I need to accept the loss and be able to walk away before I continue trading and get forced out by DAS.

February 2019 Things To Work On

Stop Loss

January was my worst month since going live in October. I broke a lot of rules and picked up some new bad trading habits. I've come to realize that after my poor trading days, one thing that I often said to myself was that "my entries and trade ideas weren't bad". I usually am not disappointed or bothered by the trades that I took. It is more so how I behaved in the trades after I took them. I don't always take A1 Setups, but many of my bad days have been because of breaking my stop loss. There is usually at least one trade where I let my stop loss run and it hurts me really bad. I let a $15 loss into a $25 loss and then into a $50 loss. By the time I am down $50 or even more on the trade, I am begging for the stock to go back to my near break even so I could take that $15 loss.

I need to work on respecting my stop loss. I always set a stop loss in my mind before taking a trade, but I might need to adjust the way that I think about it. Currently, if I am for instance taking something long that just broke above VWAP, I will set my stop below VWAP. I won't set it at VWAP. I will need it to break VWAP . So I wait for the price action to break and hold VWAP. I think this is where I get in trouble. There have been times where the stock would break VWAP and then come right back. I have poorly exited trades before because of this reason. I have switched to a break and hold philosophy, but that has led to times where the stock would break and then push significantly past VWAP. When a stock moves significantly pass my stop loss, I will hold hoping for it to pullback to my original stop loss target.

I am considering switching to using a hard stop. The majority of my trades are not bad and I will stop out most of the time, sometimes before my stop loss because the price action doesn't look right. I am still doing some research on the best way to do this. I have looked a couple of scripts here or debating if I should just manually input the hard stop.

One concern that I do have with having a hard stop is that I might let my trades actually go until my hard stop. Not exactly the worst thing, but there are times now when I exit a trade when I sense something is off and I don't actually hit my stop. This still should be ok considering the multiple minimal losses should not be greater than the one trade that breaks stop loss and gets away from me.

Das Risk Controls

One major problem that has popped up since I've implemented my risk controls and specifically my share limit, is that I will trade to that limit and trade knowing what that limit is. My trade limit is 4000 shares, I currently have the amount of shares that I've traded hidden, but I will check periodically. Sometimes I have to check because If I am near the trade limit, there is no point, watching AMD or MU when I only have 100 shares to trade left.

My problem is that I feel like I have to "spend" all 4,000 shares and make them count, especially near the end of the day. For instance yesterday I had 300 shares left in my trading day and I took a larger position in NVDA than I normally do because I knew that it would be my last trade. The risk was higher and I lost 40% of my profits because of it.

Today 2/1, I finished my trading day at 3,976 shares. I decided to take 24 shares of TSLA and I took a $50 loss on that trade. I took a trade just to take the trade and I let it run knowing that It was my last trade of the day. My day went from a not bad $27 loss to a very bad $72 loss. The only reason I went into that TSLA trade was to use the final shares that I had and try and get to break even with it. I know for a fact, even if the trade went my way, I probably would have went for a $1 move to get me as close to break even on the day as possible.

Journaling/Mindset

Going forward, I think I plan to adjust my journaling to be more emotional control and risk management based. Andrew says the three components of trading are logical trading strategies, good psychology and effective risk management. My trading strategies aren't perfect, but I feel they are easily a step above my risk management and psychology. I need to focus my trading less on making money and right now I need to make sure I can trade well. My days shouldn't be graded by how much money I make, but instead I need to evaluate how I did on the day in regards to the strategy, psychology, and risk management.

Greg · February 1, 2019

On 1/31/2019 at 3:14 PM, rom30 said:

Greg,

I am sorry things did not work out today. A couple of weeks ago, I was having exactly the same issues that you show in your trades. I really mean exactly the same. Recently I had 5 days in a row losing $150/day. The only reason I only lost $150 is because I have account controls with DAS that stops me when I reach this $150 limit.  I had a number of common trader issues. Not respecting STOP levels, over trading, revenge trading trying to recover loses, not being analytical on how to select trades, trying to catch ORB within the first 5 minutes of the open, etc.

I have taken some corrective actions that seems to be helping:

1- Every morning before trading, I hand write my rules for the day and keep the paper in front of me. It is important to hand write the rules. The human brain seems to process information better when the person hand writes it.

2- I modified my rules they are as follow:

A- Wait 10 minutes before taking my first trade.

B- Only take trades and setups that I am familiar with around the VWAP and have the potential of 1:3 or 1:2 Risk:Reward. I call these  A+ setups.

C- Set the stop loss at my risk per trade limit (see risk management below) and respect the stops. I enforce this with STOP range orders.

D- Only take 2 trades maximum per day. If my first trade is a winner I stop for the day. If I lose on my first trade I will look for a second A+ setup. If I get stopped for a second time. I stop trading for the day.

E- I do not trade after 10:30. If I am already in a trade and it is going my way I stay with it.

3- My risk management strategy is the following:

Although, I have a fully funded account I only use 10% of my real equity to trade. If my account has $25,000. I use it as if I only have $2500 equity. So for trading purposes my equity is $2500. My broker gives me a 1:4 margin, so I really have $10,000 buying power to get shares. In other words when I trade stocks, I make sure that the number of share that I take can be obtained with $10,000 or less.

I have set myself a risk per trade limit of 1% of the equity. This means that with the $2500 equity, if I get stopped out I will lose $25. I use this risk per trade limit to determine how many share to get. For instance is a stock is $10/share, technically I can buy 1000 shares with my buying power. However, if this stock can move $0.10 against me and I have 1000 share, then I will lose $100 which is way over my risk per share. Thus for a $10/share stock with a potential loss of $0.10, I would only get 250 shares. Now if a stock is $100/share I could buy 100 shares with by buying power, but if this stock has the potential to drop $1, I will lose $100. In this case I would only get 25 shares. There are different ways to manage share size to stay within the risk management. Some people have a set number of shares based on the stock price and price action. When they build their watch list they know for each stock the proper size to take. Other people use hotkeys that automate the share size based on Ask price and buying power. I personally use hotkeys that I have created for this purpose.

I use STOP RANGE orders with my STOP LOSS at risk per trade ($25) and wins at 3 times risk ($75). If I make my $75 in my first trade, I stop trading for the day. If I get stopped on the first trade, I lose $25. In this case I look for another A+ Setup to trade. If I win that one at $75, then I will be up $50 for the day. If I lose my second trade, I will be down $50 for the day. I don't do more than 2 trades per day, I either my outcome is one of the following: +75, +50, -50. I use hard STOPs so, I don't let trades run against me. I also use hard stops for my target. So when I hit the 1:3 ration, I get out with a win. Sometimes on winning trades that look strong, I adjust my STOP and end up getting a 1:4 or 1:5 ratio. I use hotkey to set up to STOP orders.

In order to be successful with this risk management plan is important to identify A+ Setups that have the potential to give 1:3 risk:reward. Not only do you need to identify them, you also need to enter them at the right price that could potentially give that 1:3 ratio. If the trade does not meet these conditions, wit for it or look at another stock in your watch list. Don't settle for less. If you select trades like this, you will have few losing trade and the winning trades will yield enough to overcome your losing trades. Obviously, this is easier said than done. Selecting A+ trades come with practice. For me this is the trickiest part of trading. Right now this is my main area of focus where I want to improve.

This risk management works well with the daily rules. For instance having a rule of a maximum of two trades per day, forces me to look very hard for the A+ setups. Also, the 2 trade rule forces me to stop trading after. My theory is that in the long run I will be ahead. If my success rate at selecting a good trade is 3 out of 5 days (60%), in a week I can expect lose $100, but make $225 for a +$125 for the week. The better I get at selecting A+ Setups, the better it gets. Right now my main focus is identifying these A+ Setups and sticking to my rules. When I had those 5 losing days in a row, every single day I was up for the day but I continued trading and gave it all back and some more.

4- I don't use 1 Minute Charts anymore because they are too "noisy". The 2 Minute Charts allows me to identify A+ setups better.

5- At the end of the trading day, I look at my handwritten notes. Make remarks on what I did right and wrong. I save my notes as part of my trading journal. I also save my trades images with annotations of what went right and wrong. I also save my trade log. I review my journal to determine if I need to change my rules or risk management plan based on bad behavioral patterns that I identify.

These are my rules and risk management. They seem to be working for me but they may not work for everybody. I am sharing because it is always good to learn what other people are doing. You probably need to find what work for you.

Analyzing your trade with my strategy:

For your FB trade you may have had a different view is you only look at the price action after 9:40 AM. You would have seen a doji and waited a another couple of minutes, then you might have seen the price bounce from a support around $165.50. The 2 minute chart might have shown a different  perspective that could have helped.

The AAPL trade was harder to see because it was trading in a narrow range from 9:35 AM until 9:45 AM. This period is a pure chop. In my mind when a stock is trading like this,  it could go either way. I see these setups as a 50/50 chance. Not an A+ setup in my mind. Eventually it went up, but it could have gone down based on the indicators. When I see these chop patterns, I look for other stock to trade or wait a little longer. Following my rules, I would have stopped trading after AAPL, since I have a limit of two trades per day.

I think the MSFT might have been easier to read with a 2 minute chart. Although, it is still a hard one to read. In the 2 minute chart you might have seen a shorter candle from 9:50 to 9:52 this could have made you wait another 2 minutes to make a decision. Again, I would have not traded MSFT because I would have already hit my 2 trades per day limit.

On PYPL, I don't know if the 2 Min. would have shown better direction. Reversals are very tricky. I stay away from them because I usually lose on them. I like trading around the VWAP especially between 9:40 and 10:00 AM. After 10:00 AM, the patterns seem to change and I don't know how to trade them. I have taken some successful reversal towards VWAP, but most of the time I can't figure out the right time to enter a trade and end up getting chopped in a move like your first PYPL trade.  Definitively, I would have not traded PYPL becuase of 2 trade limit, it is late in the morning, and it is not the a setup that do well with.

I hope this helps.

Rom

Thank you so much for this post. I appreciate everything about it. Its not easy and its going to be a lot of hard work, but I know if we keep working at it, we will get better.

I also have started to write down my rules/guidelines/tips before trading. I have an online journal that I write in and a notebook in front of me where I hand write the things I am trying to work on for the day. I feel this works great for a little, but I do need to reread them as the day goes on.

Another thing that I'm working on is making sure I take A1 setups. I have found I need to reduce FOMO as much as possible. I stay out of the chatroom after open and I mute and don't watch Andrew. If I don't find my A1 setups or worse when I see one, but don't take it, I start to take just ok setups, or even hunches. I will sometimes take a stock because it "looks weak". One thing I am trying to do is be mindful of the time of the day and look only for specific strategies in those time periods. For instance in the first 15 minutes, be looking only for ORBs. Then for the next 45 min, look for VWAP moves, and after that look for VWAP moves and reversals.

I also plan to start using hard stops. My biggest losses and worst days have mostly been because I have let a trade run past my stop loss. I will probably end up taking losses more often and slightly bigger smaller losses(if that makes any sense), but i need to make sure I don't have the big losses that just kill my day and my confidence. This right here is what I consider to my biggest problem at the moment.

Thank you so much for the feedback on my trades. There were definitely some that have a clearer 2 min picture. I didn't take great trades or setups to begin with that day. I dont think any timeframe could have painted a picture that would make me feel good about those trades. I've definitely considered using the 2 min chart, but I haven't made the switch yet. I have tried it in the past. You are right that it does avoid some noise, but I also feel there can be some additional information in the 1 min. Still debating about what I'm going to use going forward. I think if I can stop out properly, then I should keep the 1 min, since it is the chart that I've been using for the past 10 months.

My trading success is going to come down to my emotions and my risk management. If I can stop out, I believe I will be able to level up in my trading.

Greg · February 5, 2019

Feb 1st

P&L After Commissions: -$72

Trades: 20

Did I Walk Away On My Own: No - Max Shares - Das Stop Out

This journal entry is a little late. Was busy over the weekend. My trading on Friday wasn't bad but wasn't great. I took way too many trades, and didn't maximize the trades that I took.

I plan to go over more about the overall day and feeling vs individual trades. It will be easier to cover the 20 trades.

Yellow - I was very scared when I took these trades. I had a tough Max loss day the day before. I didn't wany many trades the day before, so I traded these very scared. As soon as I entered, I was ready to exit. Fear overcame me.

Green - Here I forced myself to hold, but I started to hold too long. I took good-great trades. I just wanted a homerun in each of the trades. My goal is $120-$150, and I had plenty of opportunities to get there, I just wanted to get there with 1 or 2 winners instead of taking multiple winners chipping away towards my goal. There was only the one bad NVDA trade where I stopped out very poorly. I let that run a little too much and stopped out at the top. Everything else went my way and moved fairly decently. I just didn't take profits appropriately. As you can see many times, my position MAE went to $30+ but I ended the trade at break even or near break even. I need to do a better job of taking profit, and not expecting every stock to be a big winner.

Orange - Exited these trades very quickly. Nothing wrong with these trades. They weren't the best and weren't the worst. Got out when I didn't like the price action.

Red - Again at the end the day, I just lost it. I considered stopping after the green trades and I was something like +$12 after commissions. Considering how I didn't really trade well, it wasn't the worse thing in the world to end green after commissions. I didn't have a lot of shares left so I decided to look at AMZN and TSLA. I tried to force a move when there wasn't one. I was at -$27 and I decided to use my last 24 shares on a TSLA trade that immediately went against me. I let it run against me and I had to exit at $72. +$12 would have been nice. --$27 would have been survivable. -$72 is disappointing and not how I want to start the month or go into the weekend.

$APHA - Fairly good move for APHA. Moved about 10 cents, but I didn't take too many shares for how low price the stock was. I didn't take any profits, because I figured it would break below VWAP. Sold near B/E.

$CRON - More quick on the profit taking here after losing out on APHA profits. Stopped out near B/E before the big move. Got a little scared.

$AAPL - Best move of the day. First reversal attempt was good. Moved about 40 cents, but I didn't take any profits on it. Took the Reversal a second time and as you can see took profits at about 20 cents and down to VWAP.

$NVDA - First entry wasn't great. I should have stopped out and I should have taken some profit when it did pop down. When I did stop out, I regretted it and re-entered. It popped on me and I decided to stop out if it broke $146. It broke and immediately came back down. Reentered a 3rd time for the reversal. I took profits, but I didn't do a great job. I held a lot of shares that I had to cover at break even.

AMZN - These trades were really bad. I took 10 shares, to try and keep my share count down. I need to change my mindset in this regard.

What happens when I trade these higher price stocks, is that I get really pick with my limit orders. I don't market order out of a trade and I try to get a nice fill. Sometimes the stock will really go against me when I do this. I should just avoid trading high price stocks like this.

The last trade is the one that really went against me. I only had 8 shares after covering 2. I accidentally added to my position near the top which was fortunate. I meant to actually exit the position there. A hotkey error working in my favor. Its better than going against me, but it doesn't feel good.

$TSLA - Fell apart on TSLA

I took this first TSLA trade while I was in the AMZN trade that I was losing. I traded this one very poorly and I traded them together. I took 75 shares because I felt confident in the setup and I was right. I just didn't exit or take profits because I wanted this trade to make profit and make up for the AMZN loss. I traded them together and when they both came down, TSLA came down faster than AMZN. Very poor trading to not trade it independently.

For the second trade, I used my last 24 shares. So very small share size. Right away it went against me. I tried to get a nice limit order exit to minimize the loss. I couldn't get a fill. I let it run way too long and stopped out at the top.

Overall this was a ok day of trading. SHould have ended the day green. I dont need to trade my final shares. I do need to take proper profits.

Greg · February 5, 2019

Feb 4th

P&L After Commissions: -$62

Trades: 17

Did I Walk Away On My Own: No - Max Shares - Das Stop Out

I started off today very impulsively. I took a terrible terribly ORB on FB that jumped on me. I got out quickly, but it cost me. It was a bad trade to take from the start. It is very dissapointing, because I have an alarm that goes off 2 minutes after the open that tells me to take perfect ORBS only. this wasn't a perfect ORB. After that I continued to trade impulsively and I didn't take profits when I had them. I took multiple break even losses until I took a break. After the break I traded much better. My P&L only came up about $50, but I was more rational and more calm. I took better trades and took profits.

Green is where I had winning trades that I did not do a good job with profit taking. I try to hit a home run on these trades, but sometimes I need to take my wins and move on.

Blue is where I decided to take a break. The trades were much better after this point. The last two trades at the end, I tried to get back to B/E.

$FB - I took FB short since it seemed to be holding the PDC and the 200SMA was right above it. I didn't like it as soon as I entered. It wasn't a perfect ORB that I am supposed to take.

I renetered when it held the 200SMA. Took a small profit at PDC and sold rest at slightly below B/E. I slightly panicked on this one since I was also in another trade at the same time. I didn't expect such a drastic move down.

$MU - Second trade on MU I didn't do a good job of taking profit. I took a small share size for MU so I wanted to let it run a little. I thought it would run more since it was below VWAP and all trend lines on the 1 min and 5.

Post Break Trading

$SPY - Got Stopped out on the first entry. Reentered when I still thought it was weak. Didn't take great profits. I am at least happy that I decided to just sell all when it looked strong instead of waiting for it to pop back up to B/E.

$CELG - Very poorly trade. I took this as a VWAP bounce. It never broke VWAP so I shouldn't have exited. Scared out of this one. Only lost $5 on this trade, no reason to exit.

$SQ - My favorite trade to take. The break of the 50SMA and retest. Wasn't super far from VWAP so profits were just ok.

$FB - Last trade of the day. Was considering entering at 11:26ish. Decided against it. Still thought it was a short 10 minutes later. Ok profit taking. Held the last 50 out of 100 shares too long. Really wanted it to break down to VWAP. I was trading my P&L at that point and trying to get closer to B/E. Exited this trade at B/E instead of when it started to show strength.

Started off the day very poorly. I was very impulsive with my trades and that isn't a good sign especially for trade 1. I was not in control emotionally. I did regroup when I took a break, but I should have done that earlier. My trades themselves were ok. I took a lot of trades, and I need to work on my selection. I did do a good job of keeping the trades small. Most of my B/E trades were on the small loss side instead of the small win side. I did keep the losers small, and the winners never really made super long runs.

Need to work on my emotional control. The first trade of the day is crucial. The difference in trading between a red start and a green start is huge. I need to make sure if I take an ORB that I take one that is smart and makes sense. test

Edited November 22, 2021 by Greg

Greg L's Trading Journal - Full Transparency 2019 Live

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