I love this trade. Not because it's my most profitable one so far, but because I did many things right. I had enough size which allowed me to maneuver around my position. I sold into strength and was able to re-add on subsequent set ups, which I proceeded to sell into strength again. I had no reason to be flat because it was free money most of the way. Let your winners run.
I found 3 nice spots to add and was able to take profits into strength. I wish I was a bit more aggressive with my size in the late adds, but the fact that I was able to ride this trade for so long felt really nice.
I got flat because there is earnings on Tuesday and there was a topping candle followed by a lower day. HD will probably need to pull back into the MA's before earnings is out, so I might as well get flat here and think about re-entering after earnings.
I would have loved to been more aggressive in more of those circled areas above, but I was very involved in this trade and did at least make attempts to get bigger and sell into strength.
For a deeper look into this trade click
Execution detail:
Date/time | Symbol | Side | Price | Position |
---|---|---|---|---|
2013-02-27 15:20:57 | HD | buy | $68.030 | long |
2013-03-05 11:04:55 | HD | sell | $70.300 | long |
2013-03-08 15:31:09 | HD | sell | $71.300 | long |
2013-03-22 13:47:57 | HD | buy | $69.430 | long |
2013-03-22 14:33:02 | HD | buy | $69.437 | long |
2013-04-09 13:46:28 | HD | buy | $71.519 | long |
2013-04-11 11:41:37 | HD | sell | $72.500 | long |
2013-04-11 11:41:37 | HD | sell | $72.500 | long |
2013-04-12 11:50:52 | HD | sell | $73.040 | long |
2013-04-17 12:32:23 | HD | sell | $72.371 | long |
2013-04-23 14:04:47 | HD | sell | $73.520 | long |
2013-05-08 09:53:25 | HD | buy | $75.409 | long |
2013-05-09 14:12:10 | HD | sell | $76.100 | long |
2013-05-09 15:01:19 | HD | sell | $75.596 | long |
2013-05-09 15:01:19 | HD | sell | $75.600 | long |
2013-05-15 14:38:47 | HD | sell | $77.741 | long |
2013-05-16 14:53:07 | HD | sell | $77.080 | 0 |
Thanks for the comment. I agree, there was probably no reason to get out so aggressively. This was one of my earlier trades that just happened to work. After my last purchase in early April I didn't really manage this position. I kind of just looked at it and watched it run. So then when I made a conscious effort to try and add to positions of strength, it got me a bit uncomfortable and sold too much.
This is definitely something I have been trying to work on... how to hold more of the core position while still trading around the core for cash flow.
I try to look at it as $ risk per trade instead of the actual position size. My math isn't good enough to think % of such large numbers.
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Really nice management on this one. I think you could have let your full position run more after your early April add. Seems there is a theme of selling the first portion very quickly right after you buy (here I see it in early March, early April, and early May). Perhaps you could think about lowering your position size slightly and allowing these to run more before you take profit. You might find with a smaller position you are more comfortable and less apt to sell so quickly. For example on your early May add around $75.50 you could have let that run all the way to $77.5-78 before you bailed on any of it, and might have actually made more %-wise with a smaller position than with the larger one.
In this way as you get used to the larger percent gains, when you increase you position sizes again your monetary gains will increase accordingly. I'd personally much rather make a $250 gain that was 10% of a 2.5K position than a $1000 gain that was 1% of a $100k position, because in the long run the 10% gain will turn into a 10K gain on that 100k position if you manage it correctly. Just some food for thought :)
Nice trade overall!