uncertainty

dealing with uncertainty.

1) the only thing i can be certain of - mostly - is how much I will lose on each trade.  Once I give that up  by 'hoping for the best' or 'relying on valuation' -- I will always -- always end up selling for a much bigger loss than intended. 

I also fear losing a small gain and hence rarely make large gains.  The correct strategy is to raise the stops on swings and daytrades.

It is not enough for a stock to stop going down to buy it -- it must be GOING UP.  This means there must be some kind of base pattern or   news/catalyst/volume surge to suggest a sustained move that can generate reasonable profits.

 Confidence comes from following rules.   Losing trades is not a confidence buster ...  not following a strategy is.   Follow charts -- to establish support levels.  These levels are all that matters.  Trading is primarily a psychological game -- not a math game.  Once you give up your psychological edge -- by falling into feelings of fear/regret... you give up everything. 

 Try talking out loud -- establishing what you see from a different part of your brain to avoid allowing emotional trading (fear) take over.   A trade has a clear plan and does not need to be extended (to avoid taking a loser) or ended abruptly (after a quick/small profit).  Let the market dictate the appropriate end of the trade.   You can only control the first loss and the entry.  (

why rush?

saw that MRVL -- cheap stock was gapping up due to news tied to GOOG.  Bought premarket.  Bought for myself -- got a bad fill.  Started rising and I immediately sold it for chump change... watched it rise the rest of the day even though I knew it was 4 points undervalued.  Why the fear?  Why not just hold?  Why not trust your valuation / market?  Fear is the death of all trading.   Sold DWA from fear.   Good stocks will rise.  GDXJ -- sold too early. 

 Please give me the faith to hold winners longer.  Trust the universe a little bit.  Let go of your fear.

ripper trend down

market gapped up huge but it was actually a trend DOWN day intraday despite TREND UP day internals.  Thus -- selling the open was the right call.

 I sold STJ/HAS which both closed lower and got out of DWA after a bounce instead of selling the open.  Easy money should be taken because there is no easy money.

 Stocks like GDXJ -- were up 3 points from my original entry last week.  Biggest problem is being patient.  I took the heat.  Take the reward too.  The market will mean revert and you must trust yourself and the mean reversion process. 

I did not trade futures although I made a few nice calls.  It was hard to go long since most of the day was trend down.  So patience is okay.  There were big moves in commodities/ferts.  Trust your valuation process. 

Probably 90% of my buys end up going green but I probably sell half for a loss.  Think about that.   The key is to keep position size smaller to hold on.

gold miner:

after gapping down --   bullish engulfing candle  with follow-through today...      good read on sentiment -- turned 100% negative at the bottom.  

Need to hold through the final plunge...     though.   

falling:

/gc --  morning -  in freefall   down  30/oz.      /gc finally crashes to 1525 --  nice round area of support and bounces  10 pts.  --  safe to enter on downtrend break near 1528 for   5 or 6 pts.

 When trend is strongly down --   wait for washout  -- drop to 1525 was huge candle.   Exact bottom at 1525 good clue there's too much demand / covering and may see bounce.

trend down day trade:

internals  - strongly bearish...  the key was to do nothing -- and wait until 3 pm when the cover trade comes in ---  /tf moved 10 pts --   no way to fight it.  Getting long early won't work. but end of day will likely be a very easy trade with confirmation in  bonds getting weak and -- like today - the euro bottomed off an old low established on Oct.       On Twitter, permabears were covering with glee -- so it was clear the trade just needed the last half hour for the move. 

VRUS:

good choice -- strong name...

weak market required a longer waiting period after gap up -- dropped to near gap fill then bounced, higher low -- and then easy entry for 1.20 or more.  

opportunity for bounce was again at whole hour   (11 am -- a bit earlier than that).