PFE Trade on Dec 8, 2020 13:46 from beno: Tradervue User Stock Trades.

Strategy - This is where I note down what my approach to the trade and whether or not it was A grade (or lower grade for that matter)

Confluence - Here is where I note any confluences that might make the trade better (e.g., stock near Whole or Half $ marks, VWAP is near my level of interest, any of my EMAs near my level?, Prior close level etc...)

Strike zone - This is essentially the price where I'm interested in longing, I'm expecting the price to support this zone, if price breaks below it doesn't necessarily mean a stop out, I must judge tape for that. I can always add what I call "emergency lots" below the strike zone if I feel like I can scratch the trade

Sizing - I note how many shares I took the trade with (sometimes I write down how many shares I should have taken it with as well for a comparison of how I managed my sizing. This number would also include any emergency adds / lots that I used,

Risk - This is my risk on the trade, usually its not a set price because having a set price (or hard stops for that matter) is no good unless you have a bot trading an automated system. Thats why I write my stop as "Hold below X" or "Hold above X", because when price reaches your stop area, your first instinct shouldn't be to stop out, but rather to watch the tape very closely and judge whether the stop is required or if an add is required. Your decision making process near your stop areas will be the key determining factor behind your performance as a trader.

Allow me to elaborate further on the stop. For this trade my stop was a "Hold below 41.8", so here is how I would have managed the trade under certain scenarios:

Scenario 1 - Price swipes down violently to 41.5 (30c past my stop area) - for this scenario I'm not looking to make money (although still possible) but rather looking to scratch the trade
1. I would add into the weakness near 41.5,
2. I would watch the tape to see if I can spot buying activity that is greater then sell activity,
3. I would watch the amount of volume that came in (for me to add I would have to see large volume - if no volume comes in after that swipe down to 41.5 then it means nobody is interested in buying, so a cut should be the right move)

Scenario 2 - Price slowly grinds down to 41.77 (slightly past my stop area)
I would be watching how much bids affect the stock (if down ticks on the stock only take out 1-2c of price but the upticks always take out 3-4c of price, then I'm adding aggressively down here to get to full size). My stop at that point would be based on tape, if I then see down ticks that take out more then usual, then I may trim or cut entirely

So now lets talk about what actually happened in this trade. The scenario that played out was as follows. Price came into the 42 Whole $ level and seems to be holding, so I bought two lots (two adds) above 42 then waited patiently. Price then swiped 8 - 10 cents below 42 down to 41.9. Okay so it swiped like 10c, does it swipe 10c again or does it down tick less now? sure enough, the next few down ticks that took it down to a low of 41.86 were not as violent, so price was stabilizing inside of my strike zone. I saw the volume also come in, which is another check in my favor. But...I didn't add right away, I waited to see those bigger upticks in price compared to down ticks, so when I saw that I added another lot down here. Once we reclaimed back above 42 I should have added again but I made a mistake and didn't (because reclaiming 42 is an important part of the trade.

I hope I'm making sense and this comment is too big for me to go back and review it all lol

Good luck in your trading!