Psychology note

When an experienced trader uses tools and resources to make a good trade I think it is important for the trader to commend themselves for good trading and not to think of it as being the tool or resource. Similarly when trades go against you, take the credit for that also, don't blame.

It is about personal responsibility.

Trade update

It is tough to tell if this trade will work out or not. My days off I've been sitting in front of the computer a lot, this can lead to either insight or at times overtrading. Overall this is a leading stock. But I considered the growth chances of this stock versus another, the morning action, and just decided to sell it. It closed below what I sold it for. I just get the sense this one is going down from here. I can't trade senses very well. I moved the money into one of my remaining stocks where it closed up a buck and remains near all time highs. I've noted the action in MOS, it does not matter.

I have another stock that is not moving as well. It came in on lower volume, might come in more. I have little profit in it.

I feel good!

I feel like I am trading adeptly and I am being successful at it. The market was fun to watch today. No music to play, don't want to get giddy or emotional.

Going with what is working

Of the 4 stocks I bought 3 are working out okay, another was lagging. So I sold the laggard and added to another a few points higher than original stake. With a little more research the stock I sold out of was not even in the top one or two of its group of similar stocks.

Two of my stocks are in new high territory. Two of my stocks report tonight. This is dangerous territory.

I like my chances!

Adding

So of the four issues I bought only one was profitable as of yesterday. None of the charts or volume related moves were horrible though several of these are near earnings subject to heavy losses. They are all significantly above 50 day averages. I am monitoring for big down days on volume but expect that I will more so see further accumulation. I added to the one issue with the highest RS.

WTF market

Crazy action yesterday with flash crash of SPY, down to 106, not sure what was going on. I still like the market though it does bring more fear in. My guess is AAPL move down about 20 after hours was buyable for a few day swing. I made some nice fast money on BIDU on similar reaction, held for maybe an hour after buying premarket when it took out the post market lows.

One of the issues I bought had a clear breakout, it is one to look to add to. The others are mixed but not broken.

Election year, 3rd year of president helps me to be bullish though the charts tell the stronger story.

Plans

I've done some research over the weekend and I have a buy list of growth stocks. It looks like the market should pull in a bit, I am looking to buy 50% of intended positions in 4 issues, will add to those that work. They are all must have big cap stocks near all time highs.

A good day trade SDS

SDS is the double inverse of the SP500. This past Friday I entered the day without any ideas, was not really looking to trade. I noted bullish sentiment from others. The market opened up about half a percent for the SP 500, I think it was up 6 points or so. I figured that on options expiry with so many people bullish we just could not continue with a strong morning rally. I entered SDS I think within the first 15 minutes with a mental stop of its low of the day, my target was for it to get back to where the market closed the day before. I thought about just putting in a limit sell order and going about my day. Instead I went about my day with frequent checking of the action. When I saw that my target had been reached I put in to take my profit. My gain was almost twice what I risked.

A good swing trade RSX

I like the benefits of buying breakouts into recent highs. I try to follow ETFs for this purpose, I figure I will not lose 10-20% with an individual stocks bad news or panic (like VMW of late) while being able to participate in clear market direction. INP, an India ETF is one that I missed and is showing nice gains. There can be various means to decide on entry and exit based upon moving averages, chart patterns, and time periods (buy 4 week high, sell 2 week low is one I have read about).

On 10/1 I bought RSX. I've made 20% on this one before. I sold it a few days later for 2.5% gain. RSX seems to trade correlated to the price of oil, I expected that there would be a pullback in oil price, along with a change in some of the market sentiment. It has vacillated around 34 since then, currently just higher than my exit. It remains on my watchlist.

VMW

I've been following VMW for quite a while now. Tough to examine trades and see what could have been. My first purchase was on 5/11/2010 @61.19, sold later that day 61.06. It retreated further but could have been held, I do not recall what I was doing then. Then I was thinking more about covered calls, looking to pick up a few percent each month with great stocks. I started this on 7/20. The call went against me as the stock grew. I ended up buying back the call and going further out in time. I recall that the profit in stock was greater than the loss of the call price. I think I then sold the stock and covered a profitable call. On options expiry day 8/20/2010 I was long (way over extended) some puts that I lost my arse on. The stock was stronger than I thought so I bought the stock with all I had. I sold after a big down day 10/1 for a nice profit, nearly recovering my options loss.

VMW now only a short. It has busted down on big volume.

It is unsettling to review these and other trades.

If you like trading leading growth stocks, good discussions of stocks are in the new book by Gil Morales and Chris Karcher. It details some history of them at IBD but also shares a lot of their thoughts on stocks through time. It includes better defined buy and sell rules.

I am sorry about the chart, it ought to have volume included but I need to get some other work done, not gonna change it. Pull it up on your own time if you want to see more.

Trading update and randome thoughts

I got into futures for a few weeks and while I felt like I was doing well and could do well it proved to not be so. I closed the accounts and instead of moving the money back to an equity account I put it into checking to pay down some debt. Overall, there is not much debt but before increasing market risk by much it needs to be paid down. That would be for my piece of mind as well as my spouses.

I've also cut way back on my stock trading. I'll try and do some research to show some of the recent worst and best trades. Overall, other than the HEAVY losses from futures, I am likely just below break even for the year. Considering the magnitude of one of the losses I am fortunate.

I think I see a lot traders buying bottoms in stocks. Good luck with that. When a stock breaks down, down remains the path of least resistance.

My broker has a forum. I see a lot of questions. I've come to the conclusion that when one has a question about a stock, trading method, or indicator, one should not be trading. Stop trading until you know! This is different than my futures activity in which I considered it for years before venturing there, then only did what I thought would work. I knew what I was doing, just did not do it well. There is too much money at stake to do what you are not familiar with. If you do not know what to trade, how to research stock, what criteria you are looking for, STOP TRADING. Read more. Get a firm plan to act upon.

This leads to getting advice. When we do not have the answers and are not sure of things it is human nature (at least it is my nature) to turn to others for advice. I think this is why advisory services in their many forms are so popular and can charge so much. It is also why people go to internet forums and chat rooms, because they have not a clue how to handle themselves. I hate not knowing the track record of those that populate the net. They can brag and boast all they want, they can seem to know what they are doing certain days. Even if they do not know what they are doing, by virtue of not knowing what I am doing, it becomes easy to follow them. I do not trust what I read. Sometimes the written word on the net looks like it is designed to confuse and bewilder. While I can sense where some of the net writers are in life, and what their trading results might actually be like, I've taken to considering them as GS janitors being paid overtime to spread disinformation.

Changes in 401K are working out. Many of the charts are looking better.

I like the new Marketsmith package. More bang for the buck.