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Okay, I'll go public.
A recent trade, my logic for it and how it went. This is a quick trade,
an attempt to score quick (1-3 day) small profits at relatively low risk
(note: I don't define risk strictly by where my loss/profit points are, as
you'll see in my rationale). (You don't think I'd go public with big
hairy wacko losing my shorts trade right out of the chute do you? Yea I've
got one of those open...).
Constructive criticism, why you would or would not have acted the same
way, specific advice at any point, are welcome and hopefully will be of
general interest.
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Action: SF8Z - sell short, at market, placed prior to open on 8/17.
- stop buy at about .6802 (sorry, don't have my notes here
for precise values, I think this was it exactly though)
- limit buy at about .6664 (or very close to).
(stop/limit orders placed at same time as market order)
Rationale: take advantage of the 8/16 sharp downmove, anticipating that
momentum will carry the market at least a bit lower, and
at worst the market will jiggle around close to the 8/16
low and I can get out even. Seemed like good odds for a very
short term trade. Stop is set above 8/16 long bar because of
extreme unlikelyhood that that high would be exceeded in the
next couple of days, but wide ranging within that bar is
possible. If that high is exceeded, I'm not happy but I
CERTAINLY want out!
Results: filled at .6732, well above the previous days close. This
was good in my book. Now the text book scenario is a rapid
fall through the day, and a limit fill the same day or the
next.
Instead, the market closed on 8/17 around .6725 or so. An
inside, down day, and down close relative to the
previous day's close. To plan, but not the ideal plan.
Rationale: Wait and see what the market action is on 8/18. Could still
move down to my limit buy.
Results: 8/18: a very small range day, a down day, and a down close as
the close approaches. Also, another inside day relative to
the 8/16 large range day. I'm now in the black a few hundred.
Rationale: Looks to me like the market is stalled around the low of the
big down day on 8/16, and tomorrow could as likely an up
day as a down. More waffling around here likely overall.
Buyers/sellers in a stalemate. Time to take a little profit,
be happy and look for new opportunities.
Action: I buy at market as close of 8/18 approaches, and get filled at
0.6711. My profit is 262.50 - 27.50 commissions.
Conclusion: "Any landing you can walk away from is a good landing."
I'm okay with this little trade. Didn't make much, but
I'm okay with the risk/reward structure and the "if it doesn't
go so well I break even or take small profit" result.
But maybe you are not...constructive comments?
(ps: I'm an amateur trader, and pretty much only trade off hours, daily
bar analysis. I am able to glance at the market a few times during
the day and place/adjust a few orders, but cannot watch/trade in
anything approaching realtime, as I have a day job that supports my
trading and other good habits)
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