Shared by
Markmandy54
Daily P/B to 200MA and overshoot of support. Put on 1/2 and was looking to add to full position but didn't stick to gameplan. I need to trust in system and stick to the plan. Took off for small loss when should have had +5 gain.
LESSON IN REVIEW: Must stick to gameplan
Execution detail:
| Date/time | Symbol | Side | Price | Position |
|---|---|---|---|---|
| 2014-03-27 09:34:52 | BIDU | buy | $147.600 | long |
| 2014-03-27 09:57:33 | BIDU | sell | $147.370 | 0 |
Comments
Markmandy54
I love the questioning as many times then not my trades are flawed and i'm looking for ways to improve. For the last several months B/O's have been working but last 3 weeks i've found them to be troublesome so added an old method i used to trade of Reversion (which has been working great but i've been trading them poorly).
Reversion to mean trading exploits panic, and it's totally contingent on the panic selling. I'm actually looking to capitalize on support flushing and people running for the exits, but there is absolutely guidelines to watch. The 200MA on daily was around 148 AND there was daily support around 148 as well. Although i butchered it by getting in too early, and didn't play it according to plan of scaling, i'm looking for the panic overshoot of support as most stops will be at 147.90 and lower. Add the fact that It's oversold, the stochastics are buried under 8 and the falling MA's are far away, to me this was a no brainer. On the 5 minute chart, the more capitulation volume the better and at the time i got in it was 4-5x's the selling so i buy into the weakness. I took a 1/2 position a tad early but was ok, and wanted to add a few points below to full position but again, i made some mistakes early on in FB and carried my baggage into this.
As far as target, i like to scale out around the 20MA on 5 min for 1/4, and look to swing rest for a day or two as most times the 50MA on the 30min will be near an old support, now resistance, with the ultimate game plan of leaving on a small partial to test the 20MA on daily up around 162ish.
If i'd had played this "perfectly" and added to full position as planned around the capitulation bar about 3-4 points below, normally can put a stop under the "bounce" candle low giving you about a 2 point stop stop which is just over 1% risk with a day trade target of around +4-5, target 2 of +9-10, and a several day swing target of around +15 or so. Check out FB, AMZN, SCTY, etc as they all reacted the same with stops being run on panic. Hope that answers my thought process and what the plan was until the "user error" portion took over, lol.
For the future yes, i would have had the same plan but will play it much better by scaling in, and sticking to plan.
KeithL_BOWS
Ok... i used to think you were a good trader and a smart guy....Holy Shit... you just proved it...LOL...
As a brand new trader, i really do admire your trades and thought process. Not quite sure that i am ready for this level of trading just yet. On second thought, I KNOW im not ready for this. What amazes me is how you can identify all that is going on with something like this and be able to react to it accordingly. OK, maybe you didnt manage it perfectly, but the fact that you identified it and pulled the trigger to act, That is impressive.
Thanks for the explanation, definitely was beyond how i was looking at it and does make sense.
Once you go live Keith your mind will be blown as thought process doesn't equal good trade even though theoretically it should. I'm being very transparent in my struggles (which inadvertently takes away the power of failure and much easier to palate therefore leading to a quicker strong change in growth) and this last week especially has destroyed me psychologically as the thought process and spelled out plans i've had have been spot on, yet i've been undermining my work and taking loss after loss due to lack of conviction and not sticking to the game plan (mainly entries and exits). It's really exciting but frustrating at the same time knowing the answer but struggling to do it real time. I love everyone's comments and questions as sometimes it helps reinforce what i'm doing and other times has destroyed my thesis and i've changed strategies and am thankful for that as i continue to grow.
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Hi Mark... I hope you dont mind, but i would like to pick your brain on this trade. In hindsight, i can see how sticking to your plan would have been the best, however, while watching it tick away how is that possible?
Here is my thoughts on this (and believe me, im not contradicting, just trying to learn for my own benefit). When it blew thru the 200MA, would that not have become your new target because what was support had just become resistance. If you bought at 147.60 and target of 148.66 and stop at 144, thats a R/R of .29. On the other hand, if you had a target of 152 and stop at 144(HOD) your R/R is only 1.22. Did you not have a stop set and allowed it to run or did you have a very loose stop? For me, the pucker factor when it dropped an additional $3 would have caused me to panic and sell at a low.
Shouldnt you have had a stop at 147 (LOD), in which case you would have stopped out, and then could have re-entered at 146.40 when it flagged again after the flush.
I understand your game plan, and sticking to it is important, but you could have taken a HUGE loss on this had it not bounced off that 144 level. I dont see anything telling in the chart that would tip you off that the 144 was a critical point.
Sorry......I admire your trades but this one had me wondering how you managed it. Would you have done it the same in the future?