Monday, April 9, 2007

Simply not engaged properly

I woke up late this morning, threw a half hour of research together after the long weekend and started trading. Not the way to do things.

But you know, it didn't hurt much. I was down a couple hundred dollars all day. Nothing too bloody. No awful trades. But I wasn't paying attention. I was surfing the net. I had a really loose attitude all day. And in the end, I paid the price.

It all started at around 1:40. That's when I realized that CNS was up a point from where I entered. It had trended up nice and easy from where I bought at around 40.07 but I had sold AT MARKET at 40.05 and 40.06 because I was nervous about it. I really had no other good reason. Just that things weren't really going my way, I had no big winners or no big losers and I believed the same would happen with CNS, so I just sold. So at 1:40, when I realized I left a point on the table for no good reason, I was pissed.

Then, a stock I was long, POT, crashed (definitely Freaky Hybrid Trade-Worthy). In a matter of minutes, I went from being down between $100 and $200 to being down $500. I made matters worse by churning POT a few times before he broke lower. Anyway, when he finally did break lower, a little before 2pm, I looked and saw TNH, another fertilizer stock, selling off. I also noticed that AGU and MON were both up... so, with POT and TNH breaking I thought it was only a matter of time before AGU and MON broke too, so I started getting short.

Again, wrong decision.

Interesting, that one poor decision led to a chain reaction of many poor decisions. Definitely something to watch out for.

There are a couple of old sayings that come to mind... one, "Don't throw good money after bad" is nice and clean. Another, more appropriate goes something like "If you shit in bed you only make it worse by trying to kick it out" is much dirtier, but really more to the point. I went down kicking... and as it turns out, screaming.

Once I got squeezed badly in AGU (and of course, I had to throw extra shares onto my position to make up for my losses in the other stocks) and MON I was down close to $1000. At the time, I was kind of shell-shocked... how did this happen? Now, it all seems very clear to me.

I was never on my game today and so I was easily thrown off... not even by losing money at first... just by simply recognizing that there was money to be made and I "missed it". POT just threw fuel on the fire and the rest is history.

If you're going to trade everyday, you need to focus everyday.

Almost forgot the stats:

P&L -$878
Best: MTG, $166
Worst: POT -$324

shares traded: 32,800
total trades: 195

Nothing comes easy here... when it does seem to come easy, it's only because you're prepared.


Anonymous said...

what was ur trigger for the cns trade?

Dinosaur Trader said...


Hey, nothing in particular... it was just down more than the other similar financial stocks that I follow. No real good reason to get in and I thought I was just going to get chopped more, so that's why I sold...

Kills me.


(BTW, you remember any other old trading commercials?)