The worst part is, I saw it coming.
My first short order went into JCI this morning at 110.70, or about 5 points from the top. No, I didn't see the news that it was upgraded until later... rookie mistake... also a consequence of not trading in an office.
Why do I trade like that? Because I knew at *some point* the stock would turn tail as it did after 10:30 and drop. The problem, naturally, is figuring out when that point comes without having to lose thousands of dollars first.
I'm getting better at trading the hybrid market. But I realized something else today that is different. In the past, back when people respected me and the market "traded normal", if I was trying to "pick a top" like this, I'd put my buy stop a little above the last high of the day. If I was early, the stock would trade my stop and then fill me (30 or 40 seconds later) 20 to 40 cents higher. Clearly I'm generalizing here, but that's what it used to feel like. Even when you were getting squeezed, it happened slower and it was less violent.
With instantaneous fills (really, the speed still amazes me... I know you Nasdaq traders are used to it) the speed at which you can get squeezed (or clipped) is stunning.
It causes my eyes to literally glaze over because I can't even follow the quote action... the screen just kind of blurs, I see large green bars moving ever higher against my short position and my mind goes kind of quiet... and then something weird happens.
I imagine, for a brief second, being poor. I'm mowing a lawn on some estate... there is a repugnant man there... he is throwing an empty fluorescent green can at me and calling me a "Mexican" even though I'm Italian. I reach down and pick up the can... "Monster Energy Drink"... what the?
Anyway, The big spike today in JCI happened so quickly, that I just had that deer-in-headlights thing happen. And I felt it. It's a helpless feeling, but I can identify it now. The thing I need to train myself to do in the future, when I feel it happen, is just to cover and wait for the stock to settle down.
The opportunity will come, it always does. I just need to be more patient.
Despite today's smackdown, my spirits are still in good shape. I feel I turned some corner in May and that things are looking up. Thankfully, it's still early in the month.
This is a good reminder that I can't let big losses pile. I'm going to try a new rule... and I'm going to call it something gay like the 3-trade rule. If I trade a stock 3 times in a row and lose on each trade then I won't trade that stock again for an hour. Something like that would have prevented my JCI disaster today.
Without my blowup in JCI I would have made money today... so it goes.
Anyway, here's the stats:
Best, TNH, $768
Worst, JCI, -$2188
shares traded, 35,800
stocks traded, 13, 5 positive, 8 negative
total trades, 199