Trading Review: 06-29-2016

Gross PnL: +$155.

After Commissions: +$70.

Bit of a weird day. Could have been quite a big day, but didn't quite trade 100%. Possibly feeling a little confident as a result of the prior days solid trading. Was up roughly $300 quite early as a result of some good (marginal) trades. Kinda knew they were marginal, so that was the signal that I should go for a walk and cool off a bit.
Ended up not hitting out of a stock (CLVS - short) that I knew that I should; even alerted in chat that I had hit it out and taken the loss. What is even worse is that it gave plenty of opportunity to get out (it didn't just go straight up). Ended up taking it off (as I regained discipline), where it should have been put back on.
This led to some more marginal trades, that were kinda fomo driven, where I forgot one of the number one rules of shorting high FS stocks - get a good price.
Think the best indicator here is the number of tickets I racked up on CLVS.
Eventually regained my patience/discipline and made some good trades into the close.

Preparation: 7/10
Patience: 5/10
Risk-Reward: 6/10
Discipline: 4/10
Flexibility: 6/10
Greed: 8/10
Over-trading: 5/10

Patience - given a 5 for obvious reasons related to CLVS. However, there were times when I did have good patience today.

Risk-Reward - Trades today weren't super good risk-reward. However, I don't believe anything risk-reward led to today being successful/unsuccessful.

Discipline - Didn't take stop, automatic low score. Additionally the period of tilting is very poor.
Flexibility - There wasn't too much that required me to be flexible today. Best part would be on VNET where I was trying to get long on the washout (and missed with zero fomo), then I picked the prices that I wanted for the short. I liked the flexibility there (because I picked the prices I liked).

Greed - This gets an amazing score because my ideas never really truly worked, but by taking profits quickly/appropriately I had a lot of profitable trades.

CLVS:

VNET:

TSRO:

Trading Review: 06-28-2016

Gross PnL: +$282.

After Commissions: Approximately +$232.

Really nice day in terms of grinding. Had some good trade ideas, but focused on execution and was patient for entry with no fomo. Definitely didn't go for the home run, although VBLT would have turned out nice if I had held all day. At this stage that's not something I want to do with my limited buying power though.

Preparation: 6/10
Patience: 7/10
Risk-Reward: 6/10
Discipline: 8/10
Flexibility: 7/10
Greed: 8/10
Over-trading: 7/10

FCX: Was a good loss, but entry wasn't as patience as it should have been. Was the old "confirmation not as good as getting good prices dilemna". I can guarantee I wouldn't have been faked out if I had been patience for a better entry. Really happy with trade thesis, risk-reward and discipline on this trade.

VBLT: Got two trades out of this. First was on the open. Second was a bounce to vwap zone combined with a level. I am super happy with the second trade. First trade was a little so-so.
Reason I am not so happy with the first trade is that I should have been shorting the strength. I had quite a strong bias, but wanted to combine it a defined risk-reward trade (which I guess it was with a stop against the highs). But the problem is that the level to work with on daily was $4.70-$4.75. I had somewhat mis-identified the level as $5.00 in the premarket.
Second trade is literally to perfection... I cannot fault the second trade. Wasn't even afraid to short it lower than my original exit of my short.
Given my low account size, this second trade is literally my bread and butter right now. Very consistent and low risk.

TWLO: This trade was really good for patience. I had originally wanted to take the flag breakout midday, but it didn't give me the entry I required. I felt the fomo, but I didn't act on it, and really happy about it.
The second trade was just long on a retest. In the end I just sold it on first pop. I like the lack of greed in this trade, and flexibility. I kinda decided the trade wasn't worth it half way through and adjusted accordingly.
I probably could have had a better entry, given how weak it was when I decided to bid, but can't nit-pick too much.

Trading Review: 06-22-2016

Gross PnL: -$856.

After Commissions: -$944.

Preparation: 7/10
Patience: 5/10
Risk-Reward: 5/10
Discipline: 7/10
Flexbility: 3/10
Greed: 3/10
Over-trading: 2/10

As a very general jist today was sort of like death by 1000 cuts. No individual loss was massive, although the loss on SPU was a lot bigger than it should have been. I took my stop-losses, but over-traded immensely, and was more focused on trying to execute on trade ideas, rather than focusing on getting good risk-reward entries at levels. I believe this is because I missed the CSAL trend that I was ready for yesterday. PRTK illustrates this the best where it never really breached the $13.00 level that I had planned to get long against, and would have had many good scalps against the level. Instead I made quite a few losing trades trying to anticipate "minor" support zones, believing that it should trend higher.

Greed played quite a big role today, making me miss my exits that I should have taken. This played a role in making me miss my exit on SPU (would have been +200 ish on 500 shares instead of -300 on 1000 shares); and also on SGY where my planned exit would have more or less marked the top. Would have been a +300 trade instead of -160. I guess it could also be said, that I failed on flexibility today. If you consider that my adjustments weren't very good, and (in hindsight) emotional adjustments.

06-21-2016: $CSAL Successful Secondary

Big thing about the bigger picture on CSAL is the magnitude of the recent uptrend. Barely any red day, but by no means does it look over-extended just quite "grindy". Why wouldn't you want to pick this up at a discount to current traded price?

Then the actual pricing of the secondary. $26.01 compared to prior days close $28.15ish. Decent discount.

Next consider the premarket dip to the pricing was quickly bought up. It never stayed down there. Opening and holding significantly above the pricing is enough to suggest strength - if it wasn't strong it would be trading at the offering price. Kind of like how on a low float with a catalyst when it's not going down it's soaking up shorts, and gearing up for higher.

Once it begins trending it is a trade2hold until a reason2sell.

Note: ATR only 65c but it moved $2 for the day. Even more if you count premarket.

Execution: 

(1) The gap up makes it a little more hard to buy on the open, because it isn't unreasonable to expect it to test the offering price. If long biased already before market opens you want to be looking to pick it up around premarket support, with a defined stop-loss. Once it tests the premarket support can get long on dips against the low.

(2) If missed the first long opportunity there is an opportunity to get long when it holds vwap, and consolidates near the high of the opening range. The really really important thing here is that time needs to pass to prove that it is holding there. Otherwise it is perfectly reasonable to take the short scalp against the opening high.

Trading Review: 06-21-2016

Gross PnL: +$139.

After Commissions: +$92.

Was a short day for me because I felt myself getting tilted from being extremely tired. Have been struggling to get back into proper sleep routine. Definitely could have executed on the ideas I had a lot better though.

Preparation: 6/10
Patience: 5/10
Risk-Reward: 6/10
Discipline: 8/10
Flexibility: 7/10
Greed: 7/10
Over-trading: 5/10

Had some pretty solid trades ideas, and one played out to perfection (CSAL) but didn't fully capitalise on it. Was somewhat conscious of not making the same mistake as I didn't with LPTN yesterday, but at the same time CSAL was working the whole time, so no reason to close position. Was a little bit ansy to get the DUST position on, and it could be argued that I closed the CSAL position to put the DUST one on, which is something I don't want to get in the habit of doing - it generates fomo/lack of patience etc.

Don't think the DUST trade is worth going through. Was a great idea, but didn't pan out, and executed with fomo.

CSAL: Priced a secondary at $26.01, an amazing long setup once it started trending. I was initially short (risk-reward wasn't quite good enough on short), then switched long, was stopped once, and then re-entered. In general my trades here reek of impatience. The short not having a good enough entry, the early long (which was obviously early), and even the successful long was entered early. That being said, I was super disciplined on keeping risk tight.

Trading Review: 06-20-2016

Gross PnL: +$137.

Net PnL: +$84.

Obviously a bit of a commission burner day, but am happy to end up positive. Have been rating my trades out of 10 based on a few measures. So here are the ratings for today:
(1) Preparation: 7/10
(2) Patience: 7/10
(3) Risk-Reward: 6/10
(4) Discipline: 5/10
(5) Flexibility: 4/10
(6) Greed: 5/10
(7) Over-trading: 7/10

If I was to sum up the day - in particular what went wrong. I was marginally unprepared on LPTN for what happened - I know exactly how those plays work, so could have reviewed them before trading it.
Their was a marginal fault in discipline not having a clear stop-out plan for LPTN, which again comes back to preparation. In instances where a stock moves quickly and has an illiquid nature (as low floats do) to it; it is very important to be over the top prepared. My excuse here is that I can't have the stop-loss order in the market-place, while I have a limit order for closing my position. It is clear that I need to find a work-around for this, because in the case of LPTN it moved too quickly for me to manually do it.
Over-trading: It could be argued that I was over-trading by over-the-top scalping around my core position on LPTN. However, if I hadn't done that I wouldn't have had much locked in profit for when the squeeze came. Indeed if I had continued to scalp around my core position, and been more ready to cover on a dip (for a slight loss), I probably would have turned the entire trade into an amazing well. Then if I had covered weakness and looked for reshort opportunities I would have nailed them, switching from trade2hold move to move2move trading.
Flexibility: I initially came into the day thinking that LPTN had the potential to be a big winner, as a trade2hold until end of day close at the lows. I was far too slow to go from trying to nail the home run (which was probably the right approach), to just a trade that was standard. This meant that I missed the opportunity the stock provided for additional trades, and it also tied up my buying power all day - resulting in me missing other solid trades.
Greed: In line with the flexibility I think I was probably a little greedy wanting the big trade when it was no longer present.

LPTN - Have talked enough about the nuances of the trade. Each arrow is 1/2 a position size. With the exception of the cover right before the big rally (around vwap) where I only got a tiny fill. This sort of illustrates how I wasn't fully ready to hit out the trade because I was too picky with my order. One comment I notice looking at the charts again. By not covering into weakness, and being absolutely ready to cover into weakness, by the time the breakdowns came I was exhausted from riding the short position up and down.

EPZM - I am super happy with everything about this trade. Patience for entry was perfect (waited for 10.94, instead of 10.89) which made the risk-reward just that much better. The idea was also good - it was only ever intended to be scalp against the level. Got a bit of a pull but not quite enough. Really good stop-out as well - didn't hesitate, just took it.
If there was one flaw, it was that I didn't flip long into the pull after $11.00 break on the retest. However, that wasn't anything to do with this stock - I had my buying power tied up with LPTN all day as a result of other flaws.

Low Float Big Gap

Bit rusty on this play apparently, despite it being one of my biggest winners over the past few years.

Bigger Picture: A macro catalyst bringing attention to the stock, e.g. LAKE/DGLY more caution is warranted. However, most stocks that gap up 100%+ will end up being a great short on day 1.

Scenario's:
(1) Up-trend all day, ending the day 200%+. This does happen, although it is unlikely. Additionally it is usually pretty obvious 11am onwards.
(2) Down-trend all day. Never breaching vwap aside from the open.
(3) Bit of down-move off the open, then trappy like action, and a break to highs (and probably a moderate amount above) around mid-morning before likely closing at the lows. Note that this can turn into scenario one; as a big gap often needs time to consolidate.

The general thesis behind this trade is that the gap is simply too big to hold without genuine meaningful news (rather than pumpy news).

Controlling risk: It is very important to realise that while these stocks can give the illusion of liquidity, they are relatively illiquid and can move quickly. The usually occurs when scenario 1 or 2 plays out. The stock will be grinding lower, with an extreme lack of speed, and then seemingly randomly propel higher with 10x the explosive power. This requires very quick manual speed or an automated stop-loss to get a good stop-out.

The most difficult scenario to trade is scenario #2, because there is very little to distinguish scenario 2 and 3 during the first hour. The first indication is when it holds up, when maybe it should have made a new low, or when it makes a new low, and gets straight back above on big buying (trapping shorts).

Acknowledge that may get faked out on any stop, but it's well worth adhering to that stop.

How to Trade:
Scenario 2 will be confirmed by around 10:30am. From there can look to short around vwap/at levels. Be sure to enter only half size at each level to maximise probability of success - with ultimate hard stop a level or two higher.
On the open: Short strength half size, and once weakness and defined stop-loss at highs go full size; but take some profits immediately. There is a choice between controlling size and being prepared for a high of day test, and tight stop around vwap - then reshort once the highs have failed. It is situational.

Here is a pic of LPTN, around the open which caused a fair bit of grief. But in the end played out as it should have, closing at the lows.

Trading Past Month or Two

Has been a while since blogged. On somewhat of a losing streak and have been forced to downsize to grinding a small account.

I believe that ultimately this will be really good for my trading, forcing me to focus on tight, defined risk trades. And also focus on execution of trades (for small risk), rather than on ideas. This is especially the case because commission on this account is $5 (+ECN fees) a trade. That being said, I am without a doubt under-capitalised.

Reason for starting blogging again, is that have felt reviews etc have been slacking off a lot.

Will be focusing on posting a review daily, and a "piece of improvement". Whether it be a play, or perhaps how a stock should have been traded.