Trade – April 13, 2016
It’s been a while, my friends! I know I really haven’t had much to report lately. The thing is, I have been “trading” without actually executing trades. I have been at my desk every morning, watching things unfold. I made it a point to not actually jump in, to just watch. Playing voyeur has helped me sharpen up a little bit. I know I’ve been positive on my last bunch of trades, but I wanted to spend a bit more time focussed on learning and not trading. When you trade, you can’t help but hope a trade moves in a certain direction. Bias is natural. Really good traders can take this emotion and throw it in the trash and look at things objectively. Rookies don’t. We run with those emotions. So, spending some mornings in front of charts watching things unfold without being invested in any direction has given me a bit of perspective. I am hoping to slowly work myself back into regular trading. This might mean less trading than before though. Obviously, no trading when I’m at work. No trading when I am exhausted from working the previous night. I’m better off sleeping and either jumping in on the action later in the day or just skipping it all together.
Anyways, that’s the quick summary of what I have been up to. Let’s get into today. I’ll start with MNKD.
I really liked this trade. It showed a lot of patience. I ignored the earlier action because I wasn’t watching it then. Someone (sorry, I forgot who) alerted this in the Investors Underground Chat Room so I took a look. I loved the risk:reward here because my entry around $1.92 had me out if this broke $2 with any force. That being said, I was looking at the daily over this and anything short from $2.20 was OK to me. If it rose, I was gonna get out and re-short knowing that. There was no need for that. This thing went down into the $1.80’s and then came back up near entry. It played around for a while. I thought about getting out because of the action but I really liked what was happening at $$1.90. It was a key area and I didn’t want to give up on it around there. So, I managed my stop and set $1.95 as my “get the fuck out” point and I decided to let this play. It turns out I was right. It dropped with some authority. My problem was that my exit was a little conservative when I wasn’t sure if that big drop candle was going to hold. I decided to play it safe and walk away with some profit at $$1.75 for a 17 cent gain. Of course, I was wrong and it dropped again down towards the low .60’s before coming back up. I should have showed a bit more patience. It’s OK. I like this trade because, and this is huge for me, the entry. That smart entry gave me plenty of room to play. I saw the action and kept my risk low. I’ll take that win!
Next up is SGY.
This is another one that I wasn’t watching but caught an alert in the IU chat room. Again, I loved the risk:reward here. I was a little slow and my entry wasn’t great for a long at $1.07. That was a result of some fat-fingered related slowness. I actually should have been long a couple pennies lower. Oh well. I knew I was gonna cut out once this got to the daily low anyways. So a 6 cent risk wasn’t terrible at all. This went my way for a while. Some nice moves. I was hoping for this thing to go with some push into the $1.20’s but that never happened. It double topped and fizzled. I debated getting out around then for about a $40 gain but I wanted to see if this would react favourably when it came back down to touch on the green/red line. I was hoping support there would propel it back up into the highs and a third time would either confirm that high wouldn’t break or at least give me a decent exit with around 10 cents per share profit. Unfortunately the fade kept up and I decided to exit at $1.10 only taking a 3 cent gain. I’m not upset about this. I liked my thinking throughout the trade. My head was planning the whole time based on the action. So, I will take a “loss” that is in the green. If all my losses were like this, I’d be very happy with my trading.
Too many times in March I would have a trade go in my direction and then grind back against me. I would end up losing 10-15 cents per share because I was stubborn. My only reason for thinking the price would move back is because I was invested. Really? That is a sure fire way to lose money. Both of my trades today were good for my entry hunting. Also, I actively managed based on the action and at no point did I leave any decision up to hope. So, that is all positive for me. This is a small gain day, but I love the way I did things. Hoping for more later this week or early next week.