CCL Trade on Mar 5, 2021 10:05 from tjmiller2001: Tradervue User Stock Trades.

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tjmiller2001

 

CCL sold off hard at the open and I wanted to short a lower high.

It was already down big for the day but I felt this name had more room to run if the market struggled. I felt better about this trade when I saw that CCL was very weak compared to SPY. As SPY had big green candles, CCL couldn't get up. This made me feel better about entering.

I got in with a 3:1 RR but my SL of 26.01 didn't make much sense. I should've put my stop as a higher 1m candle, at 25.95 or 25.96. Stops should be at meaningful levels, not just places that satisfy my 3:1 RR requirement.

The trade immediately started working for me and I moved my stop to a 9 EMA break. I like that decision.

Psychology: At one point I was up about 50% on my contract and I was itching to sell. One small $50 contract usually wouldn't have me so tense but this trade was working for me and the idea of giving back profits made me want out. However I knew that there was no reason to sell at this point. It was tough to stay in the position, but with SPY selling off hard, I stayed strong and didn't exit.

If I entered with multiple contracts, I may have sold 1 contract at 7:16 or 7:17 when light strength came in. However, since I only had one contract, I wasn't looking to get completely out unless there was a good reason. I need to have the mindset that, "It's okay to take some profits now and look for a reentry." During the trading day, I'm not thinking about being an active trade scaling in and out of positions. My mentality is more about: Enter, set your levels, and get out when one of the levels is hit. To be an elite trader, I need to be more fluid, tactical, and active.

Psychology: Around 7:15 I was itching to get out, this was after barely any retracement from the down move. That shows how emotionally charged I was, not calm and collected. I was itching to get out, almost rooting for CCL to break the 9 EMA so I could secure my profits. I was not very patient. Says a lot about my psychology that I was rooting for the trade to go against me so I could get out of it and take a deep breath. More experience and not trading 0 DTE contracts will help me not trade on tilt like this.

At 7:19 I was slow to exit when 9 EMA broke, my emotions were making me tense. I wanted out but at the same time I was having trouble accepting that I let it turn back on me so much, eating my unrealized gains.

The slow exit is something to work on, but the devastating issue was not reentering short 1m later when weakness came back. I need to be mentally sharper. My whole reason for getting out was that there was because the downtrend lost momentum, when I saw that sellers were back at 7:20, I should've reentered and risked off the lower high that just formed.

More re-entry opportunities later on relative weakness to SPY as well. This is a trade I should review often to see the importance of having a reentry plan, having a fluid trader mindset/moving in and out of positions.

Proud of myself for committing to my entry on this trade. That has improved recently. I'm less hesitant to get into a position.

Note: When reviewing with OnDemand feature, look for reasons to exit around 7:14-7:16. An elite trader would've trimmed their position then. I want to know what to look for there. Also, compare SPY 7:18 high to SPY 7:25 high, then look at CCL 7:18 vs much lower at 7:25, which shows relative weakness.

Lesson Learned: Have rules set after you exit. Ask yourself, "Why did I get out?" and "What would it take for me to get back in?" Example: "I got out because the 9 EMA broke to the topside. I would get back in if it broke back to the downside."


Execution detail:

Date/time Symbol Side Price Position
2021-03-05 10:05:31 5 MAR 21 26 PUT buy $0.5200 long
2021-03-05 10:19:31 5 MAR 21 26 PUT sell $0.6500 0


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