Thursday, August 30, 2007
Wednesday, August 29, 2007
To work on in the future: watching the big offers/bids in U-Quote, how hedging works.
But really... let's really try to be more patient and have the discpline. Look for really good trades tomorrow and hopefully end this week in the positive territory. If I ever feel like I'm forcing trades again I should just get up and take a quick walk.
Tuesday, August 28, 2007
Yesterday I set a new personal high at about $62. Actually, I also had a 100% winning percentage, which even Lawrence says is pretty much unheard of. Go me! I kind of looked over my trades but didn't review them though. Basically the takeaway is the following:
- Hold my good scalping trades a little bit longer
- Once you have a good stop loss, don't cancel it. It'll often save you a lot of money more than you're trying to make
Something else from the email conversation I had with Lawrence:
- Wait until there's a new low for the candle, watch it establish a base or support level and then long. If it breaks that low get out pronto
- Be careful about chasing stocks that keeps going higher or lower--hard to play and whips up and down erratically
- Focus on minimize losses
- Try not to trade stocks that trade in less than $1 range for the whole day and stocks that don't have > 1,000 share on every level of the open book. The profit margin on those is so small it's not worth it.
- Be careful not to press when something's not there
- Keep calling trades out and asking questions
Today... eh, different story. Ended the day down about $100, which really, I could've saved myself $60 if I had done damage control better. Hit my first scalp trade and it went against me but I didn't cover so a $20 loss went to $40, $60, and finally $80 in just a little bit over the minute. Another trade too, is where I did chase it a little bit and it swiped down and lost another $40 in just another short minute. What makes me mad the most is that I get out near the bottom and both of them bounced back to a point where I could make a profit. I think I still did the right thing, getting out, it's just that in the future I need to get out faster. If I can't hit my outs at 5 or 7 cents I need to get out no more than 20... probably just market out to the specialist ASAP.
I did make a good trade towards the close when futures keep ticking down after the minutes of the FOMC meeting couple of weeks ago. It was near the whole dollar and I shorted it and Lawrence actually said that he might go long on it instead. I might have to go over that with him again but judging by the futures and the open book I did think it was going to go down for a nice little profit. I turned out to be right this time but still.... need to do more thinking on that one I guess.
Monday, August 27, 2007
Complacency factor will be the demise of some people---talk to other people on the floor
Go have a drink with someone, build a relationship outside of work so it's not as uncomfortable to approach somebody
Look who's gapped up and down and maybe where they should be, look for reversals
Disseminate what's good information and what's not
Anticipate news coming instead of trying to figure out what's going on at the last minute
Saturday, August 25, 2007
I believe I could've ended the week in positive territory, instead my last trade of the week screwed me. I hit a U-Quote trade and it just kept going down. Finally after down about $15, $20 I said I had to get out. Similar situation happened in the morning and I held the stock near the whole dollar, hanging on just two more cents after losing $20... that one bounced back to allow me to take a $15 profit, and actually I could've taken a $60 profit I think if I held a little bit longer but given scalping is still foreign territory for me I just wanted to get out. Well, the last trade did bounce back before the close, too, which means I could've done some damage control and at least end the week making $10, $15 all thanks to the personal best day I had on Thursday for a whopping $25.
I don't think trading on some of these stocks that I am familiar with like KO, MO, BBY is really worth it. They don't really move that much and I've basically gone away with them half way through this week. Currently my strategy is to hit u-quote scalping at the open and close. I tried out a few momentum trades today but it didn't work out that well. A few cents of profits/loss here and there. If there is something trending down, I should probably look for the volume and open book to make sure it's a worthwhile trade instead of getting in and get hit by a small pullback or reversal. I've also been using my stops to set alerts to where I think would be a good entry point so I don't have to think about that stock and move on to find other opportunities and that seems to be working out well.
What's for next week? I'm not sure... I need to think a little bit more and review about this u-quote scalping and momentum trades from today.
Still, looking back, I think I've made much improvement compared to Monday. Everything makes more sense to me know and I have a better idea what to look for and where my entry points should be. I made a person best on Tuesday for $5 and I topped that again on Thursday for $25. Small amount, yeah, I know but it's still something positive to pat myself on the back for I guess.
I've been kind of obsessed about trying to read and learn whatever I can get my hands on about trading lately. There are just so many books out there. My gosh! I need to start studying for the 55 as well. On top of that I can't seem to fall asleep well lately b/c my mind keeps on wondering and thinking about different trades etc even though my body is weary. I just randomly pass out on the couch for a few hours after I get home now.
Friday, August 24, 2007
Meet new people and see what works for them
Don't really use market keys
Reading the tape better: see which side the specialist is printing on, the bid or offer side
The more you trade, the more you'll learn instead of stretching out your learning curve (including the keys)
The people that ask the most question and do the most work and join with teams always do a lot better
Psychologically stay positive.
Try to be more aggressive--scalp closer to the last print
Learn new things, try different trades, try it out in small shares what's working for other people
Tuesday, August 21, 2007
Entry price: short 44.47
Expected gain: 15-20 cents
Expected stop loss out: 5-7 cents
Actual stop loss/gain: gain 18 cents @ 44.29 (11:09:45)
Reason in: broke out of its resistance level for today and it reached it twice yesterday as well (actually, didn't notice the last part until Lawrence told me), couldn't really decide if I should go long or short but saw that open book had more offers so I picked my stop loss and decided to short it. Worked out well, adjusted my stops and everything through out the trade.
Entry price: long 51.36
Expected gain: 12-15 cents
Expected stop loss out: 5 cents
Actual stop loss/gain: gain 6 cents @ 51.42 (11:21:51)
Reason in: establishing a base, sees many bids in the open book. at least 2-1, maybe 3-1 risk/reward ratio. Stock almost hit target, adjusted the sell lower stop to automatic sell @ 42 and it got hit on a small pull back.
Entry price: long 38.04
Expected gain: 20-30 cents
Expected stop loss out: 8 cents
Actual stop loss/gain: loss 10 cents @ 37.94 (13:03:40)
Reason in: Broke through the whole dollar, thought it would continue to go up and it did rapidly briefly which is why I got in at 04 instead of 02... reversed and got automatically stopped out.
Entry price: short 59.94
Expected gain: 30 cents
Expected stop loss out: 6 cents
Actual stop loss/gain: gain 4 cents @ 59.90 (14:07:07)
Reason in: sense resistance at the whole dollar, risking little to trade back down, if it didn't go my way I was going to reverse b/c I figured if it did break here it'd run a lot more the other direction. The stock quickly went down after I enter the position, took my profit when I noticed a big 1000 bid came in at 87 and thought it won't fall as much as I wanted it to and got out. It did trade down to 61, near my target though... need to figure out why this was
Entry price: short 59.95
Expected stop loss:
Actual stop loss/gain:
Reason in: trading near resistance level and sees a lot of offers on the open book, same reasoning as the DKS trade. someone yanked the offer at 04 out and rose quickly. tried to get out and was only able to get out at 10.
Lawrence: when I see that offer gets yanked I would've just taken my two cent lost and get out. If that was the reason I get into the trade and when that offer is gone I no longer have any reason to stay in it.
Entry price: short 51.37
Expected gain: 12 cents
Expected stop loss: 5 cents
Actual stop loss/gain: gain 6 cents
Reason in: Futures tanking, reverse trend, got in and when it doesn't seem to break 30 and I knew that I chased this trade in a little bit I took my profit and got out.
Monday, August 20, 2007
Entry price: short 54.46
Expected gain: 14 cents @ 54.32
Expected stop loss out: 54.52
Actual stop loss/gain: gain 4 cents
Reason in: holding steady at resistance level, futures lowering, a lot more offers (big ones as well) than bids. Seeing a big offer at 54.50 makes me feel pretty good about it and after not moving for a long time I decided to take profit just so I can be on the positive for the day and really I know I should've stayed in it.
Entry price: short 30.98
Expected gain: at least 18 cents @ 30.80
Expected stop loss out: 5 cents at 31.05
Actual stop loss/gain: loss 5 cents
Reason in: can't seem to break through resistance level, sees lots of offers on the open book, futures trending down.
Entry price: long 67.29
Expected gain: at least 18 cents @ 30.80
Expected stop loss out: 7 cents at 67.22
Actual stop loss/gain: loss 7 cents
Reason in: trending up on higher volume, futures breaking out to new highs
Entry price: long 59.72
Expected gain: 28 cents; to the whole dollar at 60
Expected stop loss out: .12
Actual stop loss/gain: loss 22 cents @ 59.5 (9:43:43)
Reason in: futures inching toward new high after a small pull back, thought it could be a full rally mode
Entry price: long 67.82
Expected gain: 30 to 60 cents
Expected stop loss out: I don't remember exactly where I see the big bids at on the open book, but I think I gave it somewhere between 7 to 12 cents
Actual stop loss/gain: loss 25 cents @ 67.57 (9:47:15)
Reason in: after a sharp drop on low volume I believed it would go back up to its highs or at least somewhere between 1/3 to 1/2
Entry price: long 51.32
Expected gain: 30-40 cents
Expected stop loss out: somewhere around 10 cents
Actual stop loss/gain: gain 14 cents @ 51.46 (10:10:01); I set a sell higher stop at 51.68 if I remember correctly, Billy said it triggered my sell lower stop on a bad print
Reason in: sharp drop at relatively low volume, thinking that people are taking profit from the early rally and the stock would go bounce back at least 1/3 to 1/2 from the low, possibly even make new highs, although I was chasing it a little bit here.
Entry price: short 59.2
Expected gain: 20 cents to the whole dollar at 59, optimistically at 58.80
Expected stop loss out: 7 cents
Actual stop loss/gain: loss 11 cents @ 59.31 (10:35:56)
Reason in: Futures were at new lows, many other retailers are trending downward as well, felt after a bounce back this would be a good entry point
Entry price: short 67.04
Expected gain: 24 cents to 66.80
Expected stop loss out: 6 to 9 cents; I remember eyeing my outs at around 67.10 and 67.15
Actual stop loss/gain: loss 24 cents @ 67.28 (10:45:56)
Reason in: (need to look at BB Flashback) I thought I saw a lot of offers on the open book and it'll fall through the whole dollar with futures setting new lows still. In retrospect this really was a terrible trade near the whole dollar. I chased it and either someone just put in a huge bid at, if I remember correctly, 66.98 after I am in the position or I didn't see it before I get in and I hesitated when it hit my stop loss and exacerbated the loss.
Entry price: short 82.61
Expected gain: ??
Expected stop loss out: Don't remember exactly at all, but I do try to keep it to 7 to 10 cents
Actual stop loss/gain: loss 13 cents @ 62.74 (10:51:17)
Reason in: Saw all the oil stocks and OIH falling and decided to short. I think at this point I was pretty frazzled and wasn't thinking clearly
Entry price: long 54.61
Expected gain: 40 cents or 60 cents to the previous two levels of consolidation
Expected stop loss out: around 10 cents
Actual stop loss/gain: loss 31 cents @ 54.3 (11:08:07)
Reason in: Futures bounced back nicely, looked like the stock would pull back with it, thought it's time to switch back into rally mode
Entry price: short 37.59
Expected gain: 60 cents, to the whole dollar, somewhere halfway between the day's low and bounce back
Expected stop loss out: I think I was willing to take on a little more risk on this one about 12, 15 cents
Actual stop loss/gain: loss 27 cents @ 37.86 (11:17:49)
Reason in: Saw the previous volume was significantly higher and a fore coming reversal. Looking back maybe should've been more patience and pull the trigger and short it near the 38.10 level
Friday, August 17, 2007
- Try to get better at what you know how to do and become more and more efficient
- Monitor your downside
- Look at briefing, gapping up/down, economic news
- Review trades, look at the big winners and losers
- Review big movers of the day, IBD
- Learn your keystrokes
- Narrow focus on your strategy: find something you know you can do and make money, keep doing it instead of trying tons of different strategies
- Make incremental changes and branching off of what you do well
- Watch top traders during the open, see how they react to different situations
- Talk to top traders, take your career in your own hands and don't expect to be spoon fed
- Learning how to make money and be consistent at it and once you start making money you start making a lot of money
- Don't get caught up in comparing yourself to others, focusing on doing your best and beating your best
- Confidence is key... when you're hot put down on the gas pedals; slow down when you're in a slump
- Follow your discipline and your rules
- Take a day off after a huge loss, clear your head
- Have your outside life in order
- Be in check with your emotions
Basically got smacked around all over the place. Everything I traded except for one turned out to be a loser and all bigger than I really wanted. I tried to set my stops to just alert instead of filling me at market order like the past couple of days because a few of my trades got stopped out but eventually went the direction that I want. I guess I just froze up and paused too long.
I think I'm down about $120, $140... Not sure if Lawrence cut me off for the day, but I'm doing that to myself. I feel like going running to get off some of this frustration. Nothing was just working. Really I should probably do more reverses... as something start to turn against me cover that position and go the other direction.
Thursday, August 16, 2007
- Market short sale ticker
- Confidence is the main thing in making the jump to the next level
- Play out different scenarios and how to trade on the way to work
- High volume, few stocks
- Watch for new high and new lows in futures
- Watch the NAV for ETFs
- Find your specialization and step it up from there to gain confidence
- Always look at risk/reward
- Always remain positive, start the next day fresh
Wednesday, August 15, 2007
- The magical secret - it's tricky, do what make you money and do more of it. Always look for an extra thing that's going to put you over the top
- Ask other traders what works for them. Information beats out execution.
- Come in early, check the news
- Looking at stocks that gap up or down, sectors like oil, gold, financials
- Big money flows in IBD
- Get in by 7:30, ready to pull triggers at 8:15
- Good breakfast in the morning
- Mini conferences with 3, 4 other people to get some ideas that might make you $300, $400
- Remind yourself about yesterday, which trades did I work well, what did I learn yesterday
- Visualize the day, what it might do and what I might do to react
- Look for things to keep you in instead of cutting them off, some of the best guys end up keeping their stock even 8 times its risk
Habits of Best Traders
- Call out trades, swap ideas and build a network of information
- Think about how I can do more trades with the same risk
- Review trades, half to 2/3 of my mistakes are getting out too early
- Hedge fund masters book?? Read about setting goals... what is my goal and how I'm going to get there
- Relative and absolute measurement: most of us are accustom to measure ourselves against other people and cap ourselves out.
- Masters focus on did I do everything well to the best of my ability.
- Focus on yourself, not other people.
- Make an X amount of time talking to top traders and on technology
- U quote is working, except in the first 30 minutes and it could go against you very quickly with a big print
- People that don't make it: psychology of the market, instituitional orders... separate yourself from the P/L.
- Have a bank account, bills are paid, everything else is taken care off so if you are down you know it's not the end of the world
- Consistency builds confidence that what you're doing is the right thing, even if it doesn't work out once in a while
- Focus on cutting losses, growing winners
- Review trades, look at big losers and winner, what could you do differently
- You don't have to be very original, just see what other people are doing well and try to do it as well as they can
- Networking, talking to other traders
- Winners have to be bigger than your losers, trade bigger size is later
- Diversify your strategies
- Reminiscences of a Stock Operator
- Gradual process of pattern recognition, have I seen this before?
- The more you trade, the more you see and learn and understand
- Hybrid slow quote, public printing away ticker
LEH: Sees futures breaking down and all financials doing the same, shorting at 54.62, risk could go up as high as the 90's but set a stop at 72. Accidently set the wrong stop and triggered another short position, eventually did come down in the right direction and walk away with no damages. Well, guess what, LEH eventually closed at 51.57 and I would've made over $300 on it but nope.
BBY: I see resistance at 44.50, it traded down and support at 44 even, got in at 44.04, risking 4 cents for potentially 46, but probably more at 25. Hesitating when it trades back up to the resistance area, wanted to put a bid in at 52 right after it breaks, didn't pull the trigger, the stock ran for .30. Felt it was too high at that point and wanted to short it, didn't pull the trigger again, stock traded back down to support level at 44 dollars even
Billy: go with your gut, keep your losses tight, maybe 7, 8, 10 cents and ride those winners out.
Tuesday, August 14, 2007
Billy: Should've been slightly more patience for the bounce back and got in at a better entry price, let the winner ride longer and look for signs to hold on to it
EMC: Same scenario, came across ECN, shorted and starts going the other direction, covered with a .12 lost. The trade would've became a winner though
Billy: After a long drop off, look for a bounce back between 1/3 to 1/2 of the original and that would've been a better entry price. Did the right thing to cover, just more patience in the future
CMG: see EMC
DD: sees a support at around 47.90, enters bid at .93 and suddenly drops off and lost almost .30 on it
Billy: still doesn't know what happened, looks like someone just canceled a big bid. Might've considered going reversal on it to go back up
MO: sees lots of big bids near whole number or just below it, notes the support and resistance level. Traded 3 times, got stopped out once for .08 lost, overall positive
Me: eh... pretty good.
M: trends down, pops up on ECN, short the stock, good entry, met target and took profit
Eric: Don't trade any stocks over $70
Monday, August 13, 2007
- Watch the ECN book for a big cross and deviation from the trend and the long/short in the direction for the trend
- 2:1 risk/reward is minimum, 3:1 ratio is optimal
- Seting a whole number out
- Once you've got a winner, use the 2:1 ratio again to set your stops depending on how far you are from your target. Ex: 20 cents to the target, set the stop 10 cents below current price
- Have an eye on your outs in the bid/offer on the montage
- If a trade goes against you and breaks resistance/support, trade in the other direction
- Watch strong volume for indication of start or end of a trend
- Watch the open book to determine your outs and indication of buying or selling pressure (how exactly for the second part??)
- It's usually a good idea to set your higher and lower stops after you initiate a position and they become your reason in and reason out.
I think I was too trigger happy in the morning. I want to buy when there's more support on the volume or other information to show that the momentum or reversal is stronger and review my risk/reward tradeoff more carefully before I get in. It's tricky regardless. I think I'll only get in on the ones with strong evidence. I'm going to watch the spreads in the afternoon and try to spot some of the "free money."
Saturday, August 11, 2007
On a slighlty more personal note, I'm beginning to feel the physical effects of sitting in front of the computer constantly. My wrists are starting to hurt, thank god one of the IT guys gave me one of those keyboard pad to alleviate some stress on your wrists. I know I don't have the best sitting posture and now I'm really starting to feel the tension and tightness in my shoulders and lower back at the end of the day... my eyes are holding up ok though. That was my first concern is that staring at the screen constantly would put constant strain on my eyes.
We mock trade again today and I think by lunch time I was positive 500 some dollars with some really good trades. Yesterday I was way too trigger happy and it burned me. I kind of like to ride the reversal waves or get into a trend when it's just on its way up or down and get out quickly when I think the momentum is done. I like the energy and constant involvement with this job. I usually deal with stress well and the only signal you might pick up is that I cuss a lot more when I'm under duress. I could tell that a lot of time if a trade starts to turn against me I'd try to get out quick. It wasn't loud, but literally if I was miked all you would pick up is: "Shit. Fuck. Doo doo. Ca ca. Fudgesicles. Shnikes." People probably would mistake me for someone with Tourette. Today's result does give me some confidence going into next Monday when we trade LIVE! I'm totally mentally preparing myself just in case I do end up getting my ass kicked.
I'm drawing a lot of comparison to my Southwestern experience. I'm constantly telling myself to be a professional and trade without emotions and not focus too much on the P/L, which in Southwestern it was prettyy similiar that they tell you not to focus on your unit sales the first three weeks. The one big difference though is that it seems that Kershner is going to take out a lot longer to play out than SW... in SW I started turning a good profit after about 3 weeks and really took off after 6 and in Kershner I get the feeling that instead of weeks it'll be months. Yeek. I should try to find Rau's email and shoot him a message.
It's the weekend. I'm going to relax and watch my DVDs, do some reading and maybe go to Hamilton Pool and play some volleyball at Zilker.
Wednesday, August 8, 2007
I kept my eye on HANS and FWLT because they both reported today. It feels pretty arbitrary where I would buy or short shares. I want to get to a point where I have more informational support before I enter but they both turn out ok. I'd go long if I think it's too high and vice versa. Twice I had to cover my short positions, once with FWLT and another time with COH... COH burned me bad and I had to get out quick man. There was a sharp drop and I thought I'd ride it but it quickly was reversing and I cut my losses. Same type of trading with XOM and VLO, made like $20, $30 with those.
I think I'm going to do some reading tonight that I printed off of our Intranet and get in earlier in the morning to ask Billy some questions or maybe go talk to Lawrence to see maybe if I can watch him trade for an hour or so now that I'm more familiar with the interface.
Tuesday, August 7, 2007
We got through pretty much all the function in Gr8trade. I feel much better about what all the screens the traders look at now and not like such a big moron anymore. There are a few lingo we came across today that I'm not so sure about which I probably have to look it up later and read about them. We also filled out our short bio sheet and Billy took a picture of us for the employee profiles. I look like a dork, as always.
We closed out the afternoon with learning about Insight. It's a software that acts as a ticker if your desired premises are met so you can pull the trigger and get in that stock. It really is quite remarkable. I'm beginning to understand what HR means when they keep telling us about the proprietary software Kershner has and how they give the traders an edge.
I went into Chrissy's office today to give her my voided check for my direct deposit and met one of the former specialist that will be joining us. "Don't be afraid to lose money" is what he said to me. It reminds me of poker. You have to be willing to put your chips in the middle, but when to put your chips in and how much is up to your individual skills from weighing the risk/reward. Yes, you'll probably lose money from time to time, but that comes with the territory. If you don't hit on the flop and maybe you'll need to fold the hand, or maybe you stay in and try to make your hand on the turn or the river. If you win big pots and lose small pots you'll still come out positive. There's a lot of ways you can read into what he said, but at least that's what I got out of it so far.
It's my first day at Kershner, the trading company that I took a gamble on instead of going the safe route with PPA and PwC. I knew I wanted to keep a journal so I can improve and work through the learning curve... this was long before management suggested it. It is awfully convenient that I'm crazy about the show Scrubs right now. I don't watch TV as it airs because I hate the idea having a silly box controlling my schedule. Originally I was going to title this post "newbie," like Zach Braff's character is called on the show, but I decided to go with the chorus of the song they used for the opening credits. It shows vulnerability, but I'm ok with that. It's fitting. Quite honestly, yeah, I'm scared to death. See, I'm pretty far down the 12 steps program. I'm already on "acceptance."
Yes, I do realize I have a xanga account, but I decided to keep this stuff separate and maybe ultimately migrate over here completely. Here you will hear about what's going on with my new job, my most intimate thoughts. Although, I do have to keep in mind that certain things I probably can't write about lest I violate some regulation and gets fired. I had a few ideas on what to call the blog, but quite honestly Jim Cramer or CNBC has already taken all of them. At first I thought about Wall Street Confidential, but there's a online video segment on TheStreet.com named that already. I think this is still pretty good, kind of catchy. For those that aren't familiar with the financial world, the place where the traders work at, either at the phyiscal exchange markets or staring at 6 monitors is called the floor. Down on the floor... I just liked it. It can be taken as getting down to boogie kind of floor (and I do like to dance) or a bank robbery type (as in GET DOWN ON THE FLOOR AND PUT ALL THE MONEY IN THE BAG!!)
Anyway, slow morning... after watching the traders trade frantically for about an hour we went on with the typical HR stuff with direct deposit checks (which I probably won't have to worry about for 6 months), an entertaining 45 minute video on harassment, and bunch of other legal stuff. Billy our trainer started orientating us around the office, all the software and intranet site we will be using. Yeah, it's information overload right now. With the trading going on it's just so fast I can't keep up right now. It's just rapid fire, a machine gun going off here and there and each bullet is a trade completed. Good thing I've experience this kind of overwhelming experience with Southwestern and PwC already.
There's still so much I don't know. The money right now is secondary. I just want to end everyday feeling like I've learned something or I've improved. Everyday has to be better than the day before.