Jun 2011 Summary

 

I took 3-weeks vacation this month. Not much trading as usual.

May 2011 Summary

More trades, more profit.

2011 April summary

monthly stat 2011Q1

I have resumed trading since last December. Here is the summary of past 3 months trading. So far it is good.

Weekly summary

While I was busy searching day job and sending out my resume this week, I managed to trade all five days. Here is the numbers,

•                              AM               PM                  Shares
• Mon (3/3)       -$1,140         -$22                 31,200
• Tue(3/4)           $2,050         $170                12,700
• Wed(3/5)           $809           $310                15,200
• Thu(3/6)           -$13             $525               27,200
• Fri(3/7)             $817            -$690              16,200

The market is choppy. When it broke down one day, the next day it would pull back; when I thought it would stay up, it dropped down.  I did not trade well this week. I have more losing trades than winning trades.  Good thing is that the losses are under my control.

weekly and Feb summary

This week I traded well, especially after I disabled “P&L Column” from IB’s Feature Selector on Wednesday. Without those PL numbers around, I can focus more on the chart and the setup. The average cost column is disabled on the main page as well. This way I do not know what my enter price is, I can exit the position based on what the chart shows, not the P/L number tells. It’s uncomfortable at first, but I am much calmer than before when I enter and exit positions.

Here is the numbers.

AM         PM    Shares

• Mon(2/25)    $560    $538     11,200
• Tue(2/26)   -$650    $1,314  51,123
• Wed(2/27)   $1,086   $340     9,450
• Thu(2/28)    $719      $120      9,800
• Fri(2/29)     $910      $212      9,265

This is the kind of week I want repeat all the time.

Several things need to improve: 1) need to hold longer for my winning trend following stocks. I fear to lose any paper gain which lead for my early exit. Need remind me that give time for the winner to play. 2) Still more trades are counter-trend scalp. I should have more trend following plays than counter-trend scalp.

Even I did well this week, I still lost 9% in February. The big losses happened on 2/1(-5%) and 2/7(-13%). In these two days I did not cut loss on my trend following trades, and worse than that, I averaged down with big size. It took a lot effort for me to recover from the mental loss and gain back the confidence.

Wish I can continue this week’s success to next month.

January Summary

I started this year with a new trading account and promised to withdraw any gain from it each month. My target is 4% each month. Due to account opening process I only traded this account 13 days, 10 up days and 3 down days. Total gain is ~8%.

Several notes:

1. Write down my only trading rule: Cut Loss in Every Trade. It keep me alert for the losing trades can turn to a disaster if I do not take action quick.

2. Follow trend. Now I place scalp trade following stock trend which defined by 9 EMA on 3′ chart and 5 EMA line on 15′ chart.

3. Still learning how to get on the dummy trades. It’s easy for me to change my focus to other running stocks if I cannot find the dummy entry on my 3 – 5 gap stocks immediately. I need more patience for the setup appear.

4. Still scalp a lot. It keep me busy all the day and no time to find the good dummy setup. Need to work on this issue, be more patient, and be selective for trades.

5. Per-market trades or trades in first 5 minutes did not give me good result.

6. Also last 15 minutes is not good for trading. My biggest loss day was when I short BIDU 10 minutes before market close. I lost $4,000 on it as I hesitated and then chased the price in after hour market.

Nov 2007 Summary

November is my worst month since I started full-time trading in April.

I lose $15,000 in total. Normally I had one blow up day in one month, but this time I had 5 horrible days.

11/7    -7,100      ONXX/CCRT

11/15  -6,667      BIDU

11/16  -17,777    BIDU

11/26   -10,772   BIDU

11/30  -7,240     FSLR/ZOLT

Several reasons contributed my big losses. a) Over-sizing. I traded much larger size than my risk level  for those high flying stocks like BIDU and FSLR. As these high priced stocks would normally move 1 to 2 dollars within 1 minute, 500 shares or 1000 shares a trade put me down 1K or 2K in no time.  I would cut loss and then found my position was profitable if I held 3 minutes longer. And it led to my 2nd mistake: b) revenge-trading.  When I closed a big losing position, if the market proved that my closed position was profitable in next 1 to 2 hours, I  felt mad and always traded revengefully to try to make back my money, and  which just added more losses to my book.

There is another reason for the losses which may not be counted as mistake: c) mixed trading strategies with trend-following and counter-trend. My usual trading style is counter-trend, in which I try to pick up the tops and bottoms and catch a minimum pullback movement like 10 cents. After viewed so many traders who gained multiple points in one trade, I wanted to use trend-following strategy as well.  In stead of going complete trend-following strategy, I mixed the two strategies. It caused a lot confusion in my head. When I entered a counter-trend trades and it did not give me profit right away, I started to think the trend is still valid and I cut loss prematurely and reversed my position for another quick loss. Similar thing happened for trend following trades too.  I did not have a solid trend-following setups and trading plan yet. I just looked at my 3-min charts for the visible trend.  My entry timing was very bad, and the 3-min charts had too much noise and shook me out most of the time. Without much experience on following trend, I had no confidence to hold the position to survive the minimum pullback.

In order to continue trading career, I need to answer several questions this weekend.

1) Should I continue to try and learn follow-trend trading strategy? My counter-trend strategy can give me consistent profit but it looks very bad to have 2:1 or 3:1 risk/reward ratio and occasionally it gave me a huge loss after I averaged down several times without good outcome. Trend-following definitely has much more promises in terms of low risk entry and high profit potential. My only concern is that if it fits my trading personality. I tried trend-following setup before and did not have much success.

2) If I continue follow-trend strategy, which setup should I focus my learning on? It could be a pivot break-out, support/resistance break-out, base and breakout,  narrow range inside bar pull back,  and many others.

3) After trade setup style is decided, how can I find those setups from the market?  Should I focus on a watch list which contains the several momentum stocks with large price range? Should I build a list from daily chart which shows potential breakout from resistance/support level, or stocks consolidated for several days and ready for a trend day? Or use up/down gaped stocks?  No matter which one I choose, I need to find the tools which can help me create the watch list, or  develop my own tools for the purpose.

4) After watch list is created, how should I setup my screen to make my trading execution quick and easy? I need to choose the time frame(3/5/15 min), indicators for the charts. I need to work out the entry/exit rules, entry/exit tactics, position sizing, etc.

5) After all above questions are solved, I need to practice the new strategy with small size for 1 to 3 months to tune the strategy, create trading mindset, build my confidence on the strategy and my own ability to execute the strategy.

It takes a lot time and effort to work out a new trading strategy even we already have so much information on the Internet. The point is to find one strategy and setup which can allow me trade it comfortably.

Monthly Summary Mar 2007

After a good month in February, I did many things wrong in March, mostly entering trade prematurely and averaging down. I had more down days and big losses. I did not achieve any of the four goals I set by end of February. My big losses came from those gap open stocks.

April will be my first month as a full-time trader. Without any other income, I need to be much more selective about my trades. Several changes I will follow in next month: 1) following new game plan to change my default trade size to 400 shares and measure progress with levels; 2) Be selective on high probability trades – only price reach 1*R(ange) and 3*R(ange) will be traded; 3) No trade on gap stocks unless it reach 3*R(ange).

My goals for April:

1) Follow trading rules: maximum 1 bad trade(average down or enter trade prematurely) per day;

2) Cut loss quick: maximum daily loss < $1,000;

3) Be profitable: monthly profit/loss > $2,000;

Monthly Summary Feb 2007

February is my best month ever. It’s also a record for total shares traded.

Some good things: good profit; improved trading plan with better entry/stop signals; calm mind for gain and loss.

Some bad things: large loss days; poor discipline on trade execution.

Next month’s trading goal:

– profit minimum goal: $5,000
– profit common goal: $10,000 (reward: Sony E-reader)
– profit stretch goal : $15,000 (reward: HP Pavilion dv6150 notebook )
– one day maximum loss: < $1,500