Friday, February 1, 2008

Flaming Lips, "Slow Nerve Action"

Here's an example of why Youtube is great. I love this song, yet there's no official video. This guy made a really nice video for it, where before none existed. Kudos, moody walking dude.

Daytrading As A Spiritual Practice

The other day, in one of the comment sections here, I told someone that daytrading is analogous to a spiritual practice.

Sounds funny, I know, but it's true.

I mean, I write down these rules, all of the age-old daytrading adages, like, (add booming voice of God coming down from mountain), "let your profits run young man, but cut your losers" yet I still make the same mistakes.

I have the wisdom, it's just hard to implement it in the reality of the market moving. It's so easy to look back at static graphs and no where you went wrong. But when the futures are moving one way, ticks are moving another and news is constantly hitting, it's hard to keep your presence and perspective.

It's like "love thy neighbor." I mean, okay, I get it, but when I get cut off by some shithead driving a Hummer and talking on a cell phone, it's a good thing I don't carry a gun.

I freak out. I lose my presence and perspective. 10 minutes later I can look back and know that throwing my water bottle against my windshield only hurt myself and not the Hummer shitcake, but that doesn't help me in the heat of the moment.

So here are two trades that I wish I could make again.

First off, LFG. It was as perfect an afternoon play as any.

I bought 200 shares at $49.85 at 2:41 in anticipation of a move up to the figure. So far, so good. The most the trade moved against me was 22 cents. Now here's where I begin to fuck up. At 2:50, I sell 100 shares at $49.90 locking in the 5 cents of profit... YES! And then, at 3:16 I sell my last 100 shares "all the way up" at $50.13. Total profit, $32.

Meanwhile, look at the move! I should have made a straight point on my shares without question! There was never a reason for me to sell. The market wasn't coming in. Furthermore, I should have added to my position when the market broke $50 and then came back on light volume. In other words, I made $32 on a trade that I should have made hundreds of dollars on. It was an easy trade. My execution is all wrong.

Here's another, MTW. While this trade wasn't as perfect, still, it should have brought me more money than I let it bring.

Again, I bought 200 shares in anticipation of a breakout at 2:20. The stock had been in a long tight base and the market was moving higher. Volume started increasing to the upside. And here's where I screwed it up. I sold 100 shares at $38.65 and the other 100 at $38.72. Why? I don't know. Again, here's a trade that didn't even run a dime against me yet the moment it ran a little in my favor I locked in the profit, $37.

In this trade, I'm not as upset that I didn't buy more because the position never really tested the base. It just ran. Here, I'm upset that I didn't have the patience or the confidence to let a winner run.

Here's a final analogy for you Seinfeld fans. Remember the episode where Jerry makes a plane reservation but then his seat is sold anyway? He gets into an argument with the ticket representative and repeats over and over to her, "You see? You can take the reservation, but you can't hold the reservation..."

It's like that.

Anyway, I can't get into the system to give all the stats. Enjoy your weekend. I'll post here once or twice this weekend, so check back.

P&L, $155
27,600 shares traded.

NOTE: Again, I apologize if there are egregious spelling errors in this post. Spellcheck isn't working. WTF, blogger?

Virtual Office, $2396. SPX +17.40, 1397.00.

OBAT, $830 on 7600 shares traded.
Evolution, $808 on 64,800 shares traded.
Retardo, $796 on 2 contracts traded.
Me, $155 on 27,600 shares traded.
Dehtrader, $51 on 2328 shares traded.
Wincity, $35 on 200 shares traded.
Denarii, -$44 on 3100 shares traded.
Sanglucci, -$235 on 39,600 shares traded.

And we have a new leader!

OBAT has been on a real roll lately. It was a real dogfight at the top of the VO today too. Good job, guys.

I felt that it was a slow day today, but that didn't stop people in my office from making thousands of dollars. We traded 1.8 billion shares today on the NYSE and the VIX fell 2 points to close just over 24.

I'll post a little this weekend, so be sure to stop by.

UPDATE: It's 10:53. Judy went to a dance performance tonight and I was babysitter in chief. I fell asleep with my daughter when I put her to sleep! So now I'm wide awake. Daily post forthcoming...

Luna, "Time To Quit"

I have about 6000 songs on my iPod. The other day, after surfing, this one came on and I've been meaning to put it on the blog since because it was so perfect. Enjoy.

Art Cashin's Comments, February 1st, 2008

On the Microsoft Yahoo deal

I think the MSFT deal is a defensive move, only a counter attack against GOOG.

On the futures giveback after th jobs data

By the end of the day, Goldilocks will throw down a few Prozacs and have a few cosmopolitans as well.

Has anything altered your short-term view?

No. The underlying technicals are still short-term weak. Though this oversold rally has lasted far longer than I thought it would. I also failed to anticipate that the MBIA conference call, with only written questions, could only provide positive headlines.

Morning Link-Love (short version)

Good Morning

Time: 7:34
Mood: Blank