May 11, 2013
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Trading Update 050613 – 051013: The Devil’s in the Details
Great week on paper as I recorded big gains. I say “on paper” since in the nature of hedging, you have both positive and negative positions, so paper gains or losses may not directly reflect the true gains or losses made to the account. It’s a relative value between the two positions. So while I did make gains this week, my paper gains show a higher value. I’ll have to properly trade the opposite position to lock all the paper trade gains in.
That’s the interesting thing about hedging. A couple of days my trades had net negative adjustments on paper, but were positive in increasing my account value as I adjusted my long/short positions. Even so, it’s strange seeing negative trades as a good thing. Trading both long/short shifts my focus to being net long or short instead of the individual trade.
The focus this week has been on implementing the new strategies and insights I’ve acquired the past month. The biggest challenge is trading real-time on the right end on the chart. The complete chart you see at the end of the day may look easy enough to figure out the market directions, but it’s another thing when you are doing it real time price bar by price bar. It’s the equivalent to driving on a road where the road is being formed right in front of you as you go, and you try to anticipate were the road is heading so you stay on it.
It’s a lot like the old school video game, Night Driver:
Now imagine trying to play that game with only 2 or 3 light posts mapping the way instead of a whole road of them- that’s similar to day trading. That shows why many find day trading to be quite difficult.
There’s a slight learning curve in recognizing new signals in a real-time environment versus end of day charts, but I’m making good progress.
Trading results this week confirm the great potential in my new methods. Two days this week I had generated sizable profits rather quickly, before giving a portion back due to misreading some signals. That’s the exciting part – any mistakes made were not due to my system, but due to missed signals I didn’t pick up in time. Practice makes perfect and I’m getting familiar and refining my techniques each day.
The one drawback is I now have to chart watch, as in pay much more attention to all the markets smaller movements instead of just the bigger ones. A main positive benefit is I can now successfully trade much smaller moves in the market which provides more trading opportunities.
Comments (6)
How long have you been trading?
@Kittyluve - Since the dot come crazy days of the late 90′s….when stocks were going up by leaps and bounds based on “promise” rather than actual results. I felt like I knew sooo much back then, but I was still a green horn relatively speaking.
@SoullFire - wow so ur a seasoned trader!! i remember the 90s..seemed like a good time to be an adult. I miss those times cuz i was just a kid.
@Kittyluve - Yeah, I think that time put in helped with overall understanding and served as a foundation to move forward when I went hard core the last few years. You would have like working in the 90′s- dot com companies were hiring in droves and HR at all companies were struggling to get people. Raises and benefits were added and padded. Even the recession of 2000′s was short lived due to the housing boom. Music was great too with all the techno raves. Good times indeed.
@SoullFire - Yup but instead I graduated in December 2009, it was terrible!!!. I’m lucky I have something right now and am starting to get out of the entry level phase.
@Kittyluve - Yeah, it’s the reverse of what you’d want it to be- 2008 was the big blow up thanks to corrupt Wall Street schemes which we are still suffering from today. We usually look back on the past in black and white and the present.future in color, but the last few years have been pretty colorless to the general 99%. You are fortunate to have locked in a job at a good wage. There are so many underemployed folks with advanced degrees now.