Bullish Reversal

If I was a Japanese Candle Stick, and really, there's no way for you to know if I am or not, today I would have looked like a pretty solid hammer formation.

My first trade of the day was also my worst, short DSX through $32. As you can see, it didn't break, and then traded with absolutely no volume up to $32.50. I could have covered immediately for a 15 cent loss or so, but instead, I let the stock trade up to my stop, which was around $32.25 and due to the thin trade, I got out 12 cents higher, at $32.37. So I ate nearly $200 in the first few minutes.



Later, I made all my money back in him when I caught the actual break of $32.



My best stock of the day was WFR, which I was watching for a break of $62. I don't think this was an easy trade or anything, so I'm happy I took my money and left him alone.



Shortly after my DSX mess, I had another mess in SID. And really, I made the same mistake as I did in DSX. I sold expecting the stock to break the fig, but then didn't cover fast enough when it bounced. But, like DSX, I kept watching the stock and made back my losses later, and then some.



So I'm happy with the way the day turned out for me. I even mowed my lawn in the middle of the day while SID died for me. In fact, I find I'm a better trader when I put trades on and then walk away. If I stayed, I'm pretty sure I would have covered the SID early... to "lock in profit."

Perhaps letting my winners run is as easy as doing more yardwork. Who knows?

Anyway, I'm happy with the way I kept my cool after I got clipped early. Despite the nice performance put in by my real office, I don't think I missed too much today from the HCPG system. Like I said yesterday, I feel I'm improving. I'm not going to look too far ahead just yet... just try to get green tomorrow as well.

Here's the stats:

P&L, $210
Best, WFR, $147
Worst, FCX, -$34

8200 shares traded.
7 stocks traded, 3 winners, 4 losers.

Virtual Office, $242. Dow, +9.44, 12,289.76.

Me, $210 on 8200 shares traded.
Tokyo, $193 on 2308 shares traded.
OBAT, -$10 on 7000 shares traded.
Denarii, -$151 on 4600 shares traded.

Another decent volume day as we nearly reached the 1.4 billion share mark. And another day where select financials got taken to the woodshed. Take a look at LEH, FED, and ABK.

Smells like bankruptcy, no?

All of the recent winning sectors, ags, coals and oils took a breather today, which was necessary. Indeed, even oil took a breather, closing way down at $131.70.

It was a pretty quiet day in the VO. However, I want to note that yesterday, Denarii had one of his best days ever, netting $472 on 7000 shares traded. Unfortunately, he sent his numbers to Tokyo, and by the time I received them, it was too late. He gave back some today, but has a decent two-day total nonetheless.

In my real office, I was #15 of 22 overall traders. So it seemed to be a good day in general for traders. Whenever I get this data, I'll share it.

Anyway, I'm looking forward to the thunderstorms that are forecast for the area this evening. May they take this heat and humidity with them.

Janes Addiction, "Summertime Rolls"

It's seriously hot out there... this song always cools me down. Makes me feel like I'm on a wave. Go sit in a dark, air conditioned room, close your eyes, listen to it, and think of the beach. Lyrics below.



Fell into
A sea of grass
And disappeared among
The shady blades...
The children all
Ran over me
Screaming tag!
You are the one!

He trips her as
Her sandals fail
She says stop!
I'm a girl...
Whose fingernails are made
Of a mother's pearl...
Yellow buttercup
Helicopters
Orange buttercat
Chasing after
The crazy bee
Mad about somebody
Oh no...

Me and my girlfriend
Don't wear no shoes
Her nose is painted pepper
Sunlight...
She loves me
I mean it's serious
As serious can be...

Well, she sings a song and
I listen to what it says:
If you want a friend
Feed any animal...
There was so much space
I cut me a piece
With some fine wine
It brought peace to my mind
In the summertime...
And it rolled
Summer.... ohhhh...
Oh, oh, oh... the summertime rolls
Summer.... ohhhh...
Oh, oh, oh... the summertime rolls
Oh Summer.... Yeah, yeah yeah...
Oh, oh, oh... summertime rolls
Summer.... Yeah, yeah yeah, yeah, yeah, yeah...
Oh, oh, oh... summertime rolls

Me and my girlfriend
Don't wear no clothes ya know,
Her nose is a pepper sunlight...
I love her
And me, it so so serious
As serious can be...

America Should Thank The Daily Show

Why? Because ironically enough, they're the only reliable news outlet...

Food Shortage Hits Your Local Pizza Joint

Thief Steals Dudes Pizza - Watch more free videos

Suede, "The Drowners"

Great song if you like "the Britpop."

Gaining Traction

Since my "hell week" from early last month, where I lost 5 days in a row, I've been on a decent run. I've been green about 2 of every 3 days and have booked $2000 in gains. Surely, a $24,000 year is nothing to be too proud of, but all of those gains were made entirely from the new style of trading I've been working on... no "old DT" plays.

Once you get the hang of a style of trading, and gain confidence in it, making more money with it is as simple (okay... or as difficult) as increasing your position sizes. Since I've been trading largely with 200 and 300 share positions, it shouldn't be too difficult to almost get to a living wage level of earnings again.

I've been trading extremely lightly... trying hard to identify exactly the right time to enter positions in order to maximize my gains and control my losses. I've been very careful with my position sizing. I haven't had any psychologically damaging loss days... in short, I feel as if I've made some real progress. I mean, I know why I'm making money, and when I lose money, I know what I'm doing wrong. I also know that I've left a lot on the table, even with my small size... I could have done much better this past month even with my small lots.

Perhaps my hell week was the bottom. Anyway, I've been bouncing along this bottom for so long, that I'm cautiously optimistic at best... but I feel better, at least.

My best trade of the day came in CMI. HCPG alerted to a possible short through $66. It was a little wild early, but calmed down right by the opening low to plunge through $66.50. I caught a quick half point on 400 of the 500 shares. The other 100 shares I stopped at my entry, hoping for a larger move.



Unfortunately, the "larger move" I was hoping for came in the middle of the day, when I'm loath to trade. I also wasn't quite sure how to handle the stock since it had already violated "the number" in the morning and sharply rallied back through it... so I missed it.



Too bad.

I also had some decent trades in XTO and CSH. Again, the best thing is that I kept my losses in check. My worst loss of the day was on a 100 share position in FCX, for $58.

Off to the beach for some sunset dining with friends. It's way too hot to hang around in the house...

Anyway, here's the stats:

P&L, $270
Best, CMI, $205
Worst, FCX, -$58

4800 shares traded
9 stocks traded, 4 winners, 5 losers.

Virtual Office, $334. Dow, +70.51, 12280.32.

Me, $275 on 4800 shares traded.
OBAT, $50 on 11,200 shares traded.
Tokyo, $9 on 3449 shares traded.

For a June Monday, the market yielded some nice action.

The ag stocks continued their meteoric run, then "shit the shower," gave back most of their gains and then made them back again in the last 30 minutes... AAPL unveiled a new product, oil dropped nearly $3 in just a few minutes and then bounced $2... the list goes on... LEH... coal... you name it.

There's crazy shit going on...

This market loves to confuse. I find it interesting that as we enter into the summer doldrums, when volume typically quiets down, that volume is actually starting to increase. We traded over 1.3 billion shares today. Nice. I'll take it. That said, 165 million of that was in LEH.

Could we expect another interesting summer of trading? One can hope.

Anyway, the VO had a rather quiet day and my real office was about 60% positive. Speaking of the VO, let me take this opportunity to once again thank Tokyo Trader for doing such a fine job hosting it last week.

Stay tuned for a potentially big development concerning this here blog to drop later in the week.

Bush On $4 Gasoline

Watch how instead of answering the question, he subtly mocks the reporter... "So, you're predicting $4 gasoline?"

Varying Impact Of High Gas Prices

Here's a very interesting graphic about how the "high" cost of gasoline is effecting the different parts of the country.

As for everything else, we were away all weekend and I have some catching up to do... my daughter has STARI (not Lyme) and we're treating her but she is getting better. In fact, she's no longer showing any symptoms, which is wonderful. Thanks for all the email with well wishes.

And look, if you're heading out into "tick country" this summer with the kids and they get a tick bite, BE SURE to save the tick (remove it and put it in some alcohol... oh, and just remove it with tweezers, no burning its ass with a match or drowning it in Vaseline) and send it here for analysis. It's easy and will make any diagnosis of the disease it carries (if any) easier.

I'll work on a post later today or this evening.

Black Gold Indeed...

Yesterday I was at the pump and there was some guy with a buzz cut and calf muscles the size of my head filling up his Ford Excursion. He was just staring at the pump, shaking his head and saying to no one in particular, "this is fucking ridiculous!"

After he filled up, he walked towards the little shop where they sell other savory items like cigarettes and looked as if he was going to punch the window. He took a step back, fuming, and luckily, considered his options. He jumped back into his Excursion and probably paid $0.50 just to get to the traffic light at the end of the block.

In short, expect "gas station rage" to come to a busy intersection near you!

Of course, I couldn't be happier... now if it can go high enough to get my idiot neighbor to stop chasing 10 leaves around his yard with his gas powered leaf blower, we'll be getting somewhere.

Virtual Office, $183. Dow, -134.50, 12503.82.

Tokyo, $207 on 615 shares traded.
Me, $93 on 6400 shares traded.
Timmay, $65 on 500 shares traded.
Denarii, -$42 on 6400 shares traded.
OBAT, -$140 on 10,800 shares traded.

Looks like it was a crazy day in the market. But right now, I can't get into it. I'm going to be very preoccupied for the next few days and don't think I'll be putting much, if any, effort into the blog.

I'm not putting it on official hiatus or anything. I'll be back up 100% once we get my daughter diagnosed... it's just this waiting and trying to figure it out that makes it impossible for me to think about anything else. Could be a day, could be a week.

See you then.

UPDATE: Tokyo Trader will be manning the VO for the rest of the week. Due to the time zone difference, however, it will be posted later in the evening... around 9pm EST.

STARI or Lyme

We've had a long day here as our daughter received a diagnosis of Lyme disease. The problem is, I know for a fact that she wasn't bitten by a deer tick, but by a Lone Star Tick. Lone Star Ticks don't carry Lyme disease.

I tell you, since becoming a parent I have really begun to strongly question the competency of most medical professionals I've come across. To say that they are diagnosing to prevent litigation most of the time wouldn't be going too far...

Anyway, this has led to a very slow trading day for me. I missed some amazing trades in the morning... I mean, just missed. Perhaps I will be able to detail this in a daily post later tonight, but I rather doubt it, as I have plans immediately after the close.

Die, LEH die!!!

Some Fan Email For DT

Wow, I received this email from a poor lady in the Ivory Coast. Seems her husband died and she wants to give his inheritance to me as long as I use it in a godly way. As you know, DT is all about godliness.

From Mrs Anita Adams
N�[38 Rue Des Martyrs Cocody
Abidjan, Cote d'Ivoire

ATTN: DEAREST ONE OF GOD

I am the above named person from Kuwait . I am married to Mr Adams Johnson, who worked with Kuwait embassy in Ivory Coast for nine years before he died in the year 2004. We were married for eleven years without a child. He died after a brief illness that lasted for only four days.

Not for nothing, but "gunshot wound" doesn't really translate into "brief illness" over here... Anyway, why no children? He shooting blanks?

Before his death we were both born again Christian. Since his death I decided not to remarry or get a child outside my matrimonial home which the Bible is against. When my late husband was alive he deposited the sum of $2. 5 Million (Two Million Five Hundred U.S. Dollars) in the bank here in Abidjan in suspense account.

Look, if my entire immediate family died and I had a few million to scatter, I'd spend it all on whores and blow.

Presently, the fund is still with the bank. Recently, my Doctor told me that I have serious sickness which is cancer problem. The one that disturbs me most is my stroke sickness. Having known my condition I decided to donate this fund to a church or individual that will utilize this money the way I am going to instruct herein. I want a church that will use this fund for orphanages, widows, propagating the word of God and to endeavour that the house of God is maintained.

I dunno... stroke is bad but I'd worry about that cancer thing too. Mrs. Adams, you contacted the right guy. Despite my unfortunate comment about "whores and blow," I happen to run a church and an orphanage and I'm prepared to use at least some of the funds to help manage those facilities.

The Bible made us to understand that blessed is the hand that giveth. I took this decision because I don’t have any child that will inherit this money and my husband relatives are not Christians and I don’t want my husband’s efforts to be used by unbelievers. I don’t want a situation where this money will be used in an ungodly way. This is why I am taking this decision. I am not afraid of death hence i know where I am going. I know that I am going to be in the bosom of the Lord. Exodus 14 VS 14 says that the Lord will fight my case and I shall hold my peace.

You're hitting all the right buttons here... I fucking hate "unbelievers" too! God works in funny ways, and I guess He, in His infinite wisdom, decided to pair us two "believers." It was He who made me check my bulk mail folder today... I think I'm going to weep.

Anyway, before you "go," and I mean, die, I'd love to get a beer or two with you and beat the shit out of a couple of "unbelievers." In fact, one time I hit an "unbeliever" so hard in the stomach with a baseball bat that his left eye bulged out of his head permanently. God, indeed, is great, and He hates "unbelievers." However, if you give unbelievers "bulging eye" He loves you.

I don’t need any telephone communication in this regard because of my health hence the presence of my husband’s relatives is around me always I don't want them to know about this development. With God all things are possible. As soon as I receive your reply I shall give you the contact of the bank here in Abidjan . I want you and the church to always pray for me because the Lord is my shepherd. My happiness is that I lived a life of a worthy Christian. Whoever that wants to serve the Lord must serve him in spirit and Truth. Please always be prayerful all through your life.

Surrounded by unbelievers in your last days... My heart, Mrs. Anita Adams, goes out to you. Okay, I'm gonna email you and you send me the bank information. Sounds good. Meanwhile, with some of the funds, I'm gonna send a small team of "bad people" (only bad to "unbelievers") to take care of your late husbands family. They haven't lived in accordance with your beliefs, and I say we kill them all. With God, all things are possible... surely you should take a few "unbelievers" with you when you go.

Contact me on the above e-mail address for more information’s, any delay in your reply will give me room in sourcing another church or individual for this same purpose. Please assure me that you will act accordingly as I Stated herein. Hoping to receive your reply.

Whoa! What's with the pressure? Clearly, you took your time and worked hard at "sourcing" me for this opportunity? What are you gonna do? Just email millions of random people? That sounds like a really bad idea. Some "unbeliever" will get their hands on your email and use it to steal your money from you. And you know those "unbelievers..." some of them will even stoop so low as to pose as a "believer" just to make dirty Internet money.

Remain blessed in the Lord. Yours in Christ, Mrs Anita Adams.

Amen.

May 2008 Monthly Trading Review

DTs monthly results in graphical form... nerdy, eh?

 

(h/t Tyro for helping me with the chart)

At the end of April, for the first time in my 9 year stock trading career, I took a stab at setting some monthly goals for myself. Apparently, forecasting isn't my forte.

I didn't get even remotely close to meeting my modest monthly profit goal, of $6000. In fact, I was down on the month, to the tune of $675. Not good. I'm new to this "setting goals" game, but I guess I should roll my profit goal back somewhat for June.

In May, I set a target of $300 a day. In June, I'll set a target of $250 per day, or $5000 for the month.

Another goal I set and missed was my "win/loss ratio," that is, positive days to negative days. Look at this particular stat as a measure of my sanity. I figure if I can just be green 75% or 80% of the time, I'll be generally happy with work... it won't feel so "grindish." So for May, I set a goal of 3 green days for every 1 red day.

Instead, I was green 11 days of 21... about 1 to 1. Pretty awful. I was probably in a bad mood for most of May. Indeed, reflecting on my actions during the past month, I was a dick.

Nevertheless, in June, I'm going to keep the 3 wins for every 1 loss goal.

So how did I get here? I started the month in a total tailspin, losing 5 of the first 7 days. I lost $915 on my worst day of the month. That's too much. One of my goals for this month was to limit my worst day to -$600. The silver lining is that my second worst day was -$509 and after that, every loss was sub $500 and most, far smaller.

So I limited my losses quite well, overall. I didn't have any crazy blowup days that saw me screaming, red faced, at the computer. That's a positive as far as health and mental stability are concerned, surely. And that's important.

I've started over, basically. Trading a completely new style almost exclusively for the entire month. And it's not just the trading style that's completely different. Trading style goes far beyond watching exits and entries and figuring out which stocks to watch. Trading style also effects the pace of your trading day, and your expectations throughout the day.

Early on in my career, and up until very recently, I actively traded the open, somewhat like a madman. I just don't do that anymore, and I feel the "extra space." Sometimes it feels like boredom and a lot of the time, frankly, it has felt like lost opportunity. It's definitely made it harder for me to focus... because without positions, I feel my mind wandering.

Just look at the statistics. In February, I averaged 24,800 shares traded per day. By April, I had dropped down to 12,900 average. In May, I averaged just over 10,000 a day. So I'm trading half as much as I did just a few months ago. And last year? In May of 2007 I averaged nearly 40,000 shares a day. So transition is occuring. Change is happening, and relatively quickly.

And don't forget... I'm doing this on my own. This blog is my sounding board... I trade remotely, without the benefit of talking to other traders each day. I sometimes wonder if I traded in an office if I wouldn't already be out of this slump. The point is, I think change goes much slower when you do it by yourself and without the group dynamic that an office provides.

However, later in the month, I started to feel like I was finally getting used to the "extra space." I can see how, in the near future, it will be an asset. I'm starting to feel less pressure on the open to be active for activity's sake. I'm slowly becoming more calculating and watching for eventualities and waiting for scenarios to develop and play out. It's a mental shift. I watch fewer stocks, more actively, instead of watching many stocks with less focus devoted to each.

If I can get through this summer and come out in September a more confident, stable, profitable trader, these months of indecision and worry will be worth it. If September comes and I'm not seeing any improvement in my trading, I'm really going to have to start considering a second stream of income. That will be the theme of this blog for the next few months... me continuing to work out the kinks, hopefully getting leaner and stronger as a trader, and all the while imagining what else I could possibly do for an income.

It'll be interesting. Let's see what June brings.

Anyway, thanks to Tokyo Trader, you can see a spreadsheet of the VO members and our stats for the month, here. (Just click over to where it says "VO May 2008..." The first page is just my stats.)

I'm not good with graphs and stuff, but if anyone can explain how I can make a graph of my P&L showing the cumulative results as the month wore on, I'd make it and share it as well.

The Libertines, "Can't Stand Me Now"

Green=good music.

Trading MDR On An Otherwise Quiet Day

My day was really dominated by one stock. I traded several stocks on the day, but all with 100 shares, since I didn't have any confidence in their setups... I was just taking small gambles.

I liked MDR though, and so I watched it very closely, mostly because I didn't feel there was much else happening. Volume today, was pathetic (until the close, that is) and as it was the last trading day of the month, I planned on taking it easy no matter what.

MDR was on the HCPG watchlist last night for a move up to $62. However, they added a caveat that they thought the stock needed "more time." Apparently, the stock didn't want to wait. It spiked nearly 2 points in the first 15 minutes of trade before taking a breath, at around $61. At this juncture, the stock needed to base before it could move much higher, and so it was time to chill and watch.

About a half hour later, the stock worked its way back up to $61 and I bought a few hundred shares with an average price of $61.05. He moved up and so I bought 100 more at $61.20. Now, I threw some sell limits out there up in the $61.80-$61.90 area, but they weren't hit.

Instead, the fucker reversed.

I wish I had sold out of all my shares, but I wasn't quick enough. This is a problem I have with the target system... if I'm expecting the stock to trade higher, and it fails, I'm not quite sure how aggressively I should be moving my stops up. I probably shouldn't have held my position as the stock dipped below $61, but I did.

In fact, I bought a little more at $60.89 and $60.90. So I had 600 shares, which lately, is a large position for me.



But man... that's when "the stand-off" began. For the next 20 minutes or so, the dude traded in a dime range. My "out" was $60.80, and so having "the toad" (Wincity's technical term) trade pennies above this level for such an extended period of time wore out my nerves. I flaked and sold 300 shares at an average price of $60.86. The remaining 300 I left stopped at $60.80.

I noticed on the 15 minute graph that MDR was making some NRIBs, or something... I went over to Jamie's site to see what I could find... some answer or something. From what I could figure out, he liked the setup (meanwhile, Jamie, if you're reading, am I right to think those are NRIBs on the 15 minute graph from 11:00-11:30 today?). So when the stock cleared the top of the first 15 minute bar in the "set" I bought 200 more, at $61.17. So I had 500 again and the stock began to move in my favor. I actually felt confident that I was going to be right with this one.

Still, I flaked and sold 100 at $61.34 and another near the morning highs, at $61.42.

But with my last 300, I held, and I was fairly satisfied with the results. I limited 200 of the 300 out at $61.90 expecting resistance at the old high of $62. So far, so good. The last 100 shares, I really wanted to hold, so I set my stop low, at $61.25, giving the stock plenty of room. As it traded up, I moved the stop below the previous 15 minute bar.

After the stock cleared $62 with some "brio," I decided to move my stop just below the most recent price level. The low of the move, at 12:55, was $61.86, so I put my stop at $61.85.

Well guess what? The motherfucker came down and stopped me out, filling me at $61.78, the low of the fucking move. After that, it sailed back up over $62, reaching a high of $62.72 before reversing lower to close at around $62. So I was pissed. A good trade, but I still managed to get myself stopped out at the low of a move for some shares.

I finished the month with a green day, and so, I'll take it. But man, I'm itching to start sizing into these positions more. I felt confident with this trade after it cleared $61.17 the second time around... perhaps I'll start getting that feeling more.

Also, the fact that my worst trades of the day were made with small size I also take as a good sign.

Tomorrow I'll post a "monthly review" since I set some monthly goals for myself in May, I want to assess how I did. Also, bloggerdotcom has been teasing me with some new post that he may or may not have written... that will drop, eventually.

Have a good weekend, stock market bitches.

Here's the stats:
P&L, $122
Best, MDR, $243
Worst, RIG, -$89

4200 shares traded.
9 stocks traded, 4 winners, 5 losers.

Virtual Office, $2. SPY, +0.24, $140.26.

Me, $122 on 4200 shares traded.
Tokyo, $60 on 793 shares traded.
OBAT, -$89 on 9000 shares traded.
Denarii, -$91 on 3400 shares traded.

Wow, we did 40% of today's volume in the last 20 minutes of trade. There were loads of imbalances... obscure, little stocks, with huge imbalances. Not sure what to make of it all. But it was a heavy volume, strange close. I lost $50 just playing around... normally, when there are that many imbalances, they work. Not today.

Anyway, speaking of imbalances, I'm looking forward to the upcoming Russell Rebalancing... guys in my office are already salivating over the possible gains and losses.

Until the close, we were on track to trade less than a billion shares on the day. So it was largely quiet out there. The VO was largely absent and not much of a force to be reckoned with in trading.

I have to say, that trading without the "aid" of CNBC is much nicer. It's quiet, unemotional, and fun. Turn off the TV and just watch the graphs... better for the blood pressure levels.

I'll have a daily post up later this evening and over the weekend, a monthly recap, of sorts.

QUESTION: Is my blog load time all fucked up? And can you see the "recent comments" widget? It seems to have disappeared...

Flaming Lips, "The Abandoned Hospital Ship"

I don't watch or listen to CNBC anymore... I just have my iPod on shuffle. I figure, if I'm not going to make money, at least I can listen to good music.

Anyway, this song came on today and seemed somewhat relevant to my situation. Despite the odd title, it seems to be about someone who has come through some ordeal, and is looking back on it from the other side. So perhaps it's not relevant just yet, but maybe soon, it will be.

Robots Set To Colonize Antarctica

So they've already taken over the stock market and now they're onto Antarctica.

I mean, I love the game of Risk. I always start in Indonesia and then creep my way into Asia and take over the world. I'm pretty sure that the robots are using Antarctica as a springboard to launch their global war of death and destruction.