The First Few Days of Day Trading

[investorpaul]

So I had an idea, my brother trades poker and sometimes he records his hand using screen capture software. So I though I could record the chart of a company I am trading, have my trend lines, support/resistance, etc plotted and record it for the length of my trade.

I could then add a voice over explaining my reasons for entering and exiting the trade and what my thought process was during the trade. I would obviously speed up the timing so you dont have to watch an hour or two worth of trading and would hope to make the video about 4 or 5 mins long.

I would then load it on youtube or something and provide a link in my blog.

Good idea? Rubbish? Not worth doing? let us know.

P.S I will be doing it for personal study any way because I want to be able to review my trades in "live time" anyway so it wont be too much extra work.

 

[investorpaul]

Hi all,

The statement came through for Fridays results and it wasnt pretty. I short sold Xstrata and ended up losing nearly $230. I had the signal to buy, but it reversed almost straight away. I think the problem was:

A. I jumped in too quick
B. The general trend for the week has been up and I tried to trade the reversal which didnt last.
C. I didnt analyse the trade enough.

So anyway after blowing almost half my weeks profits in one week, I saw that Xstrata had reversed and was now in an uptrend. I asked myself, should I buy or any I just trying to trade my way out of trouble? If I felt I was just trading to try and win back some of my loses I would have turned off the computer quick smart. However I thought about it and took an objective view that if I wasnt in the trade I would buy it, so thats what I did.

And good thing I did too, it continued its uptrend for another hour and I was up the $230 I had lost, then my computer crashed - I've never been so stressed in my life - I had begin to notice weakness and was concerned that it would have dropped by the time I rebooted. I quickly logged back in and my thought about weakness was confirmed, it had dropped back a little but not too much. I sold out for a gross profit of $160 so after commission I crawed back about $110 of my loss. For the rest of the time I monitored the stock it trended side ways, I could have probably sold out for another 20 or 30 dollars profit if I had my exit timed a bit better.

So basically I went from being extremely p****ed off at myself for nearly ruining a weeks worth of profits I was some what pleased that I was able to continue to trade with an objective though process and as a result craw some of the loss back.

As my first week summary mentioned I have gone through a fair wild week and experienced extremes at either end of the spectrum..... And I love it. I cant wait until I trade tonight.

Thanks all,

ip

Trading ResultsView attachment 40273

 

[Iron Man]

well done - i know the feeling when the computer packs up just at the moment you need it most.

 

[investorpaul]

Hi All,

I just thought I would keep you posted on why there has been no trading updates. I have had the past week off from work for Study leave as I had exams for my Degree in Property that I study via correspondence. I am happy to say that I have now completed my exams (Marketing & Business Finance) for the term and can jump straight back in to study.

I had exams on Monday and Thursday and unfortunately I got itchy figures during the week and decided to trade - Big Mistake - I wasn't in the right head space and quickly lost about $150 (incl. Brokerage). I have learnt my lesson now and wont be doing that again. I hope to post these trading results later today, along with those from last night where I made a modest profit.

Hopefully people are reading this blog.... but unfortunately I cant find a blog hit counter, etc??? Does anyone know if you exists and how I can implement it.

I'll post again soon,

ip

 

[Trembling Hand]

You are on a course to blow your inadequate capital. FAST!!

You don't have enough to day trade especially stocks paying big commish per side. and then risking many time the R per trade that you should.

Maybe a post on what you are trying to do and how you have PLANED to get there with MM included.

Think that would be of more value than stepping on the roller coaster you are now on. IMHO

 

[investorpaul]

I disagree with your comment but I will post a blog on the issues you mentioned. Ultimately though we will see what happens in 6 months

 

[Trembling Hand]

Whats your Stop as a percentage of capital?

Whats your Commish as a percentage of capital?

You have already stated that your commish paid cost you 10% of your capital in a couple of trades!!!!!

Whats your chances of coming back from 5 losses in a row? When it happens? with your R level at the last trade?

 

[investorpaul]

If you read my blog I acknowledge that my stop as a percentage of capital (once brokerage is taken into account) is 4 to 5%. I also acknowledge that this is above the 2% and give reasons as to why. As a percentage of my overall portfolio it is under 1%.

Again I have commented on commission - It is high - I know that. But as the article states Im not going to throw 10k into each trade just to make commission more affordable.

I have increased my capital base by $400 to date, I know that I have paid out a load in commission, I have also acknowledged that as well. But that said my blog also mentions why I dont want to trade with 10k just to lower my commission cost percentages. Im not at that stage in my trading experience yet.

Obviously the chance of returning from 5 losses is hard, But five losses in a row at $120 a pop would result in a combined loss of $600. That would bring my trading capital down to $2300 (only $200 down on my inital amount). 10 losses in a row would be $1200 (obviously i am aware at this stage that the Risk per trade would be increasing). A $1200 would bring my capital down to $1,700, I would still be able to trade with that capital.

 

[dannydb]

Your planning and decision making process for each trade may be useful to write down... at least you would get some constructive comments - at worst you'd get too many comments which may end up being noise you don't need. If not on this blog, then at least in your own personal notes?

 

[investorpaul]

Hi Danny I do keep a personal note book on my trading, thoughts and decision process

 

[elmundotrade]

That would be a great idea mate.... I'm a new trader and I'm learning a lot on the process, I don't mind loosing money to get expirienced, and I think it would help a lot watching someone else experiencing trading and recording..

I can see this is an older post, Are you still alive, around trading and surviving this current times?
...

Cheers.

Paul.
(I'm another paul trading, seems to be lots of Paul in ASF) :jump:

 

[investorpaul]

Hi all,

Its been a while since I posted on my Blog and since I traded.

I guess at the moment the question is how do I balance work and trading. As some of you may know I was trading CFDs on the UK market. This is ok but I find my trading is really constrained to a couple of hours at most (I have to get some sleep). The answer to this is obviously to trade the Aussie market, which I feel more comfortable with for a number of reasons. Obviously a major benefit will be having a greater feel for the market and the companies, as I found out through trading the UK market it takes a hell of a lot of effort to keep up to date with all the news in another country. Also trading the Aussie market will mean trading at normal hours, when my brain is functioning best. Not when I have come home from work and have my brain and body winding down for the night.

Ok, so that really is problem one. How to work and trade? to compound this problem my trading style and personality as well as risk management really lend itself to intraday trading.

I have also decided to throw more capital at this, I know deep down I can do it and I have had a taste with the UK markets.

Basically I will have 10K CFD account in addition to my savings and long term portfolio so I can better follow risk management strategies and give it the attention it deserves. I have the ability to add 1.5k to this account a month as well if need be.

So does anyone else out there balance work and trading? Maybe I have to alter my trading strategy or perhaps I need to change the times/days I work, who knows.

 

[investorpaul]

CFD Trades:

I am taking the view that we will see another leg down in the stock market and hope to be entering short positions over the next couple of days/weeks when I get the technical indication to do so.

QAN, BHP and WBC short all closed.

Long BBG

 

[investorpaul]

New Trade (see above):

BHP - short sold - entered at $33.98

 

[investorpaul]

New Trade Short Westpac entered at $18.69 - I got caught out, my boss came over to give me something and the priced dropped another 10 cents by the time i entered. O well

 

[investorpaul]

Some of you who read my original blog would have seen that I was providing an update almost daily of the trades I made and the amount I won and/or loss. At the time I thought it would be a good way to keep track of what I was doing and to analyse my trades.

However, what I found was that I was spending considerable time writing the blog, thinking what to write and in a somewhat "stupid" action, thinking I had to trade or do something just to update the blog.

Since I stopped writing my blog, some months ago, I stopped trading because of Uni and because I discovered that I did not have enough time to day trade the UK market. I have over the last few months re-evaluated my position and got back into the markets. I am not shy to admit that my first couple of trades, since starting again, were all losers, wiping out my small profit from my original day trading and eating into my initial capital (nothing terminal, but not good none the less).

Stepping back into it, I am doing everything properly. I have the spreadsheets set up to input my entry price, automatically calculate my potential loss, profit and risk to reward. I enter the trades and set my stop losses, which follow the max 2% risk rule.

In addition I have stopped focusing on indicators, alot of my trades (when I took a hit on my account) were indicator focused and I found that I was not paying attention to the most important aspects of trading - Price and Volume. Since placing less emphasis on indicators and more on the actual price movement I have found that my trading has improved and I am now identifying more opportunities, which so far have resulted in better profits.

Another important aspect I have learnt is to distance my long term investing mind from my short term trading mind. I am still waiting for a pull back (which I think will eventuate so I can enter my long term positions) but I was previously finding that this idea of waiting for a pull back was limiting the number of short term long trades I was entering and meant I had a focus on shorting a number of stocks for a couple of weeks. I am pleased to say this crossing over/confusion with my two different strategies (long and short term) no longer exist and I am trading my short term positions without consideration as to when and how I want to enter my long term positions.

So in summary I wont be providing updates of my positions because I think it was distracting to my trading. (I am not doing this to shy away from highlighting any losses and am happy to admit that I am down slightly, although the last few trades have started to pull it back). To be honest the journey I have taken has probably been the best thing for me as I have learnt some valuable lessons without blowing my account and feel that I am improving. No doubt so more lessons will be learnt in the near future and I definitely look forward to them.