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

11/6 | SPY will become bearish this week

Reason

Initially, I would have thought that the market will continue on a bullish streak. The reason being that the past few days have continually gapped up with some decent weight on the candles. However, 11/3 saw some rejection at the highs with the market closing around halfway. 11/6 had a strong start that quickly bottomed out. I think the steam has died out from all the excitement from the Feds and the interest rates and the job reports.

Result ❌

The market went on a short but bullish climb up. The key takeaway here is that the gap ups from the continued stocks that were moving up bullishly was a sign that the market really wants to move up.

Trade Hypotheses

11/8 | RIVN long at $18.45

Reason

Rivian was trading higher in the Tuesday post-market and Wednesday pre-market hours off some good earnings. Rivian posted a narrower quarterly loss and surprised Wall Street by raising its production guidance for the year and ending its exclusivity deal with Amazon.com Inc. for its delivery vans. This natural gap up will make Rivian a good long trade, but we will need this to retrace first to an important point at the $18.45 mark, where it acted as a point of resistance but seems from the pre-market hours to be a new point of support. We’ll want to see how this point is tested when the opening bell rings.

Result ❌

The main problem here was I placed a buy order within the first 5 minutes. Rather than letting the stock determine a direction, I jumped into the trade out of FOMO. Because of that, I lost 56% of my profits. Luckily, I was able to contain myself by easing in with a decent amount of share size (I was contemplating 5x that amount). I entered the trade at the top arrow at $18.36 and exited after it was drastically declining at two marks: $17.12 and $17.20.

11/8 | NVDA long at $458.75

Reason

When analyzing Nvidia’s charts, I noticed a support and resistance zone around $457.30 - $458.75 within the past few days. I think we can buy the stock as high as $458.75 (in case the market starts ripping) but we can also wait for the price to be tested as low as $457.30 before we go long.

Result ✅

The arrow above is my entry, albeit it was higher than $458.75, in hindsight I would have never made the entry at that price. Instead, I entered at $461.17. The RSI indicator was above 70, so I’m not sure why I did enter the trade, but luckily the trade held on until the overbought conditions were realized and the stock began to dip. I leveraged a scalping strategy for the rest of the day to make back my profits I lost from the RIVN trades.

11/7 | NVDA long at $457.75

Reason

NVDA tested the $457.75 zone twice yesterday which acted as resistance zones. If it breaks beyond $457.75 mark, then it could potentially become a support zone. This will occur only if the market becomes bullish, which I personally doubt.

Result ✅

The market was downtrending for the first half hour and it seemed like my prediction that the market would turn bearish was becoming true, however this seems more like a shakeout so industry traders can get in at low prices for an inevitably higher market. My prediction was inaccurate because of the hammer formation we saw in yesterday’s daily candle, but because of how the last few daily candles have gapped up, it seemed like the market has more buying power. With that, the trade ended up working out as a good trade with a lot of room for profit.

11/6 | NVDA long at $453

Reason

NVDA has had strong upward momentum with the market. It was moving entirely upward on 11/3 and the pre-market hours closed still higher than the close from 11/3. Our entry will be the highs from 11/3, which is at $453.

The daily chart is showing a strong inclination to continue climbing up.

The 2d chart is showing continued interest from buyers, which strengthens the case that the stock will continue to climb.

Result ✅

In general this was a good call. Whether you purchased the stock at the beginning (if you had a chance to, it just took off), or whether you waited for the retracement, this was a great opportunity to make a profit.

11/6 | COIN long at $87.30

Reason

If the market continues its uptrend, then waiting for the stock to dip lower before entering higher than a significant high from 11/3 will be a good entry. Bitcoin’s price has been steadily increasing which should give Coinbase some good momentum.

Result ❌

While this stock allowed me to execute at that entry and close out with a profit, I also got in at the $88.20 high mark and got stomped out fast (see the trade study below). Ultimately this wasn’t a great stock as it bottomed out to very low levels; the stock resembled bitcoin’s price pretty closely. There was a huge spike in volume at the 11:45 which would have been a strong signal for any trader in the trade to exit, luckily I was already out by this point.

Trade Studies

Exiting Losing Position When Seeing Topping Tails On SPY

I was in a long position in COIN at $88.20 when I saw the topping tail on the SPY above. That was a clear signal for me that the market was rejecting the push by the bulls, showing a turning point for bears gaining control. I then exited the position at $86.60 below, took my losses, and glad I did as the stock continued to tank. As I become more confident in this signal with this study is showing, I will not only exit my position, but enter a short position. Had I done so, I could have seen a maximum of $2.50/share profits (of course, that’s all in hindsight but a great upper bound).

Analysis

11/9 | Massive loss on COIN trade

On 11/9 I made a last minute trading decision to buy 3x the normal share size I take in a trade on COIN. Coin was at the $99.40 mark. I placed a market order which bought at $99.71. At this point I knew that the extreme volatility was not a good idea, as I was originally trying to make a 5x trade but my platform warned me against it. After buying my shares, the stock began to fall and there were half an hour of consecutive, steep red candles. I lost all of this week’s gains and then some.

Lessons learned

1. Accept large share size risk → Do not hold onto multiple of shares unless you’re looking to quickly get in and out of the market. In this case you also need to be more cognizant of a stop loss and honor that, as every cent lower is now amplified.
2. Have proper stop loss (risk management) → When placing this type of trade, I must immediately know where my stop loss is and honor that. Any negotiating with myself is only a sign of mental weakness, which tells me I shouldn’t
3. Truly accept when to pocket your gains for the day → Almost every time I have a decent size in my profits, I make an impulsive, not-well-thought-out trade that nukes my gains and puts me in a steep loss. This is a recurring theme, I need to know that it’s better to walk away with small or no profits rather than risking an impulsive trade.
4. Honor the RSI value → When I placed my trade at $99.71, the RSI value was 78.70. My protocol tells me this should never have been a trade to make, had I adhered to my own rules.

While this stings, in a way it’s comforting knowing that if I were to just honor the RSI value being above 70, it should have been a clear signal to not have entered into the trade.