Trades

** This is taking the average profit per trade relative to the average loss. So a $5K profit and a $5K loss is a 1.0 score. A $5K profit and a $2.5K loss is a 2.0 score and a $2.5K profit and a $5K loss is a 0.5 score.

Market Hypotheses

11/20 | The market will continue on a bullish trend and break past $459

Reason

The market’s been on an upward trajectory ever since the Fed has hinted at a softer landing from inflation. Aside from the gap up we saw last week, we have been mostly green candles and will test the $459 level which was our local maximum in the past 6 months. If we break this value, the market will continue to rip which I hypothesize we will. Traders have been itching for a bullish trend and I believe they will sustain it.

Result

Trade Hypotheses

11/22 | NVDA long at $500

Reason

Result

11/21 | AI long at $28.69

Reason

Result

11/21 | DKS long at $129 after a retracement

Reason

Result

Trade Studies

Revenge trading — stop while your emotions are rampant

Today (11/22/23) was one of those days where I didn’t feel like I was being objective. When I saw an opportunity, I would force the situation in my head on what the next outcome would be. I took a massive loss today, while yesterday I took a large profit. The difference between today and yesterday is that yesterday I felt entirely open to the market, like an empty cup. I was very objective, devoid of any emotions, and I genuinely felt like I was in a flow state — trading in the zone.

However with today, as soon as I took a massive loss on one of my trades, I then made the decision to jump back into a trade, one with a small value but with 10x the share size in order to try to recoup my losses. It was at this moment where I should have been more in tune with what I was doing and how it goes against my trading principles. When I go against my trading principles, I’m not authentic to who I am. Once I entered this trade, I took another massive loss, even bigger than my last one.

Looking back, I wasn’t really cognizant of the market trend (I was projecting my own beliefs on what will happen with the market) and I wasn’t really accepting of the risk. I know this, because even after taking this loss, I was jumping into basically any trade to try and recoup my losses. And guess what — it KEPT GETTING WORSE. There are moments when I am aware that I am not in the right emotional state, yet the idea of taking on such a big loss to ruin what would have normally been a good week was too much to bear.

THAT is where the problem lies. I haven’t accepted the risks that come with trading in the market. Anything can happen and when it does, you must admit that you aren’t really jiving with the market enough to know how it is going to move. It is in these moments that you must realize you have no edge and it is better to stop trading, take your losses, and go on with your day. As they say, live to trade another day. That is something I didn’t do today, and while it stings I know that learning from this is the only way I can make this loss an advantage and benefit to my trading tool belt.

Entering too many, sporadic trades

There’s a reason day trading wisdom insists on traders not over-trading. Normally you’ll see under 10 trades in a given day and because of this, traders are more apt to plan their trades, allow their winners to run, and walk away after their win rate places them in the green.

However, I have been in the habit of digging myself out of deep red days by guerrilla trading my way through incremental profits. While scalping might get me my profits back, the issue here is that the trader will get used to making random trades that aren’t backed by any hypotheses.

This is undoubtedly true. While I continue to look at the market trend, VWAP, RSI, and TIC.N indicators, I tend to make “FOMO” trades where I pocket measly returns. It’s exhausting, and most importantly I tend to equal out how much I profit and lose, resulting in barely any improvement in my position but exhausting hours into the process.

Today I made 73 trades — that should be about a month’s worth. Surprisingly, I didn’t make much progress on the hole I dug myself in — luckily I’ve been more accepting of my losses because I’m aknowledging the risk in every trade, but it’s still not ideal.