Friday, June 22, 2007

Lucky

Dumb trades, you admit them to the journal and move on

very dumb trades, we all do them, it takes longer to get them behind you, but you get it all right

really really dumb trades, well I told the chat room about it and I write about it here, because I hope next time my internal Account Protection Team takes care of the really really dumb trade before it becomes one.

Here is the emotional protocol of a very very dumb trade

- 2.380 USD + 2.240 USD = -140 USD or Wrong + Hope = You lucky bastard

Long 69.51 CL (Light sweet crude)

Add one at 69.21 (after it has tested that level twice)

Average Long at 69.36

Leaving the screen as I can no longer watch the madness

Globetrader_12

Down to 68.28 -108 or - 2.160 USD

Up to 69.18 USD

Globetrader_13

Hope takes over...it will go the remaining 18 ticks to BE and beyond into the close

Sell-off into the close 68.65

- 71 or -1.420 USD

Globetrader_15

After the pit closed it sold further, but held 68.50

I will hold it overnight

Researching Nigeria Newspapers..maybe the strike will still affect the oil industry

5 hours sleep ... Asia did nothing

5:30am CL around 68.60

ticking up, but 68.65 is a barrier and Europe starts selling oil

Globetrader_17

68.36...68.25 my account starts screaming

UNCLE point is near, where is enough enough?

Looking at a 60min chart

Globetrader_07

looking at daily charts, at weekly and monthly charts

Globetrader_03 Globetrader_04 Globetrader_05

Support is far below 67.50

That's no help, I can't hold it to the daily support, even if trading there will not change anything in the current uptrend picture

I know I got it very very wrong and I have to stop the bleeding

Stop Limit 68.20

Stop limit is not executed as CL jumps over 68.20 and trades 68.18

COIL seems to hold daily 34ema

Globetrader_08

Remove the Stoporder and put it at 68.15

68.17 trades -119 or -2.380 USD

COIL ticks up CL follows suit and we trade 68.25, .36, .57

Lucky idiot

CL trades down to 68.40, 68.36 SHIT SHIT SHIT

68.20

Holding and reverse

Stop Market at 68.15, I leave the screen and get something to eat

It's going up

68.90 -54 man am I glad I got not squeezed out

69.14 69.00 68.98

the phone rings

69.07 69.13 we have strong upward momentum

69.21, 69.31, 69.29 and holding

Stop 1 at 69.27 hit

69.17 69.22 69.30 69.36

Stop 69.31

69.39 69.35 Stop hit 69.31

Globetrader_09

All out 69.29 average

-2.380 +2.240 = -140

Yes I know...Don't tell me about Stoplosses, don't tell me about being dumb, about not following my plan, about violationg all the rules I have, about discipline

I KNOW IT ALL

I thought writing about the emotions going through my head will help me recognize the ingredients leading to such idiotic behaviour

I had a green day before this trade, but I've had quite a lot of stopped trades this week, where the market proved my initial signal right after I got stopped at breakeven + 1 tick.

So I was in that I'm ultimately right mood

I had actually made no trade for the last 2 hours and missed a few nice signals already

It was late in the day around 4:45 pm my time when i took the trade, it was hot and I was tired.

I was sure oil would make another run at 70$ (Error No.1)

The signal to take the trade was there, but it just did not work out. I mused about the long and entered a bit late at 69.51 instead of 69.44

I noticed the resistance at 69.55, but thought it would be taken out. 2 tests failed and I did not exit the trade at breakeven (Error No.2)

I hesitated adding to the trade at 69.21. The market traded 69.20 and reversed to 69.42, it did it again and only then I commited myself to the add-on (Error No.3)

The market did not trade at 69.21 this day again. Instead we broke lower.

At 69.15 I was red for the day and was sorry about the profits gone on a dumb trade (Error No.4)

Strong sell-off and I did not Reverse the trade even if I saw more selling coming (Error No.5)

I got a chance to exit at 69.00 after the recovery high was in at 69.18.28 and a new lower high was made yesterday evening at 69.07

Globetrader_11

This morning it was only hope and being very very lucky (a bit being stubborn may have helped as well)

Oh yes, I will work on myself to transfer some of that resilence to cover to my profitable trades and I'm sure I will do very good with them

This time I was lucky

I have my share of trades where I wasn't lucky

Maybe writing about this trade helps me to identify the ingredients of impending disaster before it strikes

Have a great weekend

3 comments:

Anonymous said...

Ouch, that's painful to read. You think admitting will help, but the kind of attitude you demonstrated in the trade means you'll do it again - maybe not this same error, but another one like it. Ackowledging your mistakest won't actually correct things. The reasons it happened are still in you. Chances are you will trade ok for awhile until when you least expect it you'l' screw up again. Then you'll whine on your blog. Eventually you'll figure out you have a fear of losing. You can cut most of your losers, but it only takes one moment of madness to clean you out. Face the truth. You failed. Don't do it again.

Now watch how you misinterpret the intention of this post and delete it as though it's an angry comment. Trust me, I'm not angry. I don't care about you. But I did the same as you before. I can now say I have never let a loser run for 5 years and counting. I also promise myself I never will either.

Globetrader said...

Why should I delete a well meaning post?
You are right the reasons, the fear of losing or more correct the realisation, that I just took a position, a risk way over my account size, are still with me.
The article did not change that. But it was a new way for me at least to deal with it. It's not whining or for sympathy, that I write such an article. It's because I hope to get a response like the one you wrote anonymous.

This afternoon someone suggested looking at NG Q7. I sure liked the seemingly easy way to trade it in demo, but I also see 15 tick movements happening within 5 trades. That's 150$ up or down.

And I know that might be a contract where a fast movement against my position might leave me unable to stop it, when the set stop limit order got jumped over. I decided not to trade QG for the same reasons and I will leave NG alone for a while. My first responsibility is to protect my account, the profits will take care of themself, if I can resist the urge to interfere.

Gary said...

Thanks for sharing..takes a lot of courage to relate such a disaster...NEVER let a crude oil trade EVER go more then 13 ticks against you..NEVER...you wasted two days of profitable trading opportunities sweating something you should have put in your tailights IMMEDIATELY...when you get long crude it better get on the bid and stay on the bid pronto and vice versa with shorts on the offer...IMO crude is one of the best of the best to trade, but be aggressive, be fast, and DO NOT let crude get away from you...it's a recipe for a one way bus ticket to the poor house in Waxahatchie, Texas with a no rest stops...Peaktrade