Wednesday, February 10, 2010

I followed the plan and traded it. Set stop loss @ correct technical location, -good thing since it came within 1 TICK of hitting. Feb 5, 2010

They say, "Plan the trade and trade the plan." I finally did that on my second trade. Learning from my loses without getting too messed up, but I let more setups pass after gaining back some loss today because I was burned out. Maybe another day I won't blow a trade like I blew the first one today and then not be stressed and then be able to take part in more trades. Yes, I let the market beat me today. But it started with my own mistake. Then I had to trade to come back. After I did, I was done! So here's trade 2:

I. That tall red bar is showing some exhaustion after the down move this morning, then a double bottom with candle bars with tails at the bottom and the next pivot high was higher than the prior one so the next pivot low after the double bottom was my entry long.
II. NYSE TICK went from a high for a long time was only -200, then TICK actually duplicated the pattern on price helping with confirming what I was seeing
III. TRIN also coming down from a high to a lower high also confirming bullishness
IV. zoomed in on the 2m bars here
V. Took heat there with my stop set at a technically correct one tick under prior bar from entry. Forming a candle bar with a tall topping tail is NOT what I wanted to see forming there as I was long, that was not good!
VI. TradeStation has Matrix and here in the double white box is the red loss indicators each level is one tick and I was down a bit with one tick just prior to this screen cap of the stop loss getting hit.
VII. Shows location of my original target stop to exit with future potential gain over the prior high which I decided to adjust downward in the bracket.
VIII. Here is the downward adjusted target stop which considering the bearishness of the day, and the still sloping downward moving averages, I wasn't very confident of this new uptrend putting in a higher high, so I set this target where resistance would theoretically exist.
IX. I also advanced stop loss to reduce potential for the gain to turn to a total loss, although after being slipped for 2 ticks earlier today, it could still be a loss even with stop loss of break even plus 2 ticks. I call this my bracket squeeze. At one point this stop loss was also only one tick away from hitting.
X. This trade that I had to overcome fear from entering, hit my profit target for two full points. This box is the result of today's trades. The massive error, and the comeback. ($50) is ($55) with fees and $40 is $35 with fees, for a total of ($20) A loss, but an improvement from a loss of ($55) without having attained any substantial experience. What I mean is, trade one was a lesson, but a lesson I've failed to learn many, many times, however, trade 2 was an event that I have very rarely experienced because it is one that I have many times passed up due to my pessimistic influence on this rather discretionary style of trading.

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