Trading Diary

Friday, September 2, 2016

Opportunity in the Market Never Ends

Ghost Month is over. It was a difficult time for me and I can't say that my port was unscathed. I traded several breakout plays but as it turned out it was another failed breakout and once again, made another failed trade. I keep on repeating the same mistake over and over, one trade after another, during this so called Ghost Month. I got frustrated! Bigtime!


Image result for What to do picture





Check my trade statistics on Other Breakouts and ATH/Mini Borg Plays. I failed miserably, out of 4 trades I failed 3 times.  So, I said to myself that this has to stop and find a solution to it. Therefore, I avoided breakout plays and tried trading bounce plays instead, because it is where I'm at a 100% batting average as of that moment (hahaha only 1 trade, tsamba lang cguro un).  


Trade Statistics for August


As I was scouring countless stocks for bounce plays, I spotted VITA closed at -17%. After studying the stock, I was convince on catching this falling knife at 2.17. Along with my entry price, I also set my exit price and "If Else" scenarios. Now that all things are set for tomorrow's (Sept 2, 2016) bounce play, what's left is my order to be executed.

Sorry Folks! I wasn't able to capture my original chart before that last candle. 

Before I forget and proceed to the actual trading day, I happened to stumble, the night before Sept 2, an article from one of the tribe members, Ms. Akio. She stated there to zoom in and zoom out on different timeframes to better grasp what's happening on the stock. This happens to be very useful on my trade today. Thank You POWSSS MS A!

Now comes the trading day and I felt very confident, that it will be a successful trade this time. All gears are set. Battle mode on.

"Proton Catalyzer, starting up. 
Power Flow, nominal. 
All Armament Systems, Active. 
All Weapons, Green" 
-Checklist in riding a Gundam Suit

I was like a gundam pilot, checking and rechecking everything before that bell rings. 


*Bell rings* VITA opens at 2.34 and abruptly sliding down to 2.30, then 2.25, then 2.21. Kunti na lang and mahit na si 2.17. But it didn't came. 2.21 was its low during that partial bounce to 2.59. I was just 4 ticks away from that approximately 15% gain. I was distraught by that lost opportunity. 

After all that hardwork of analyzing the market, I was left with nothing. As in zero wins and zero losses. How sad. 

But hey, a gleam of light appeared unexpectedly. 



I saw the ticker tape with TUGS running wildly in it and coincidentally, at that same moment a friend of mine alerted me of TUGS. So I hurriedly check the chart of TUGS and kaboom, it's almost breaking its all time high (ATH) price and already broke its small darvas box. Then I remember the zoom out and zoom in style of Ms. Akio.


Here's what I saw:

Daily Chart 

Zoom in (I saw  TUGS while its trading 1.95)

I bought  TUGS at 2.01 as it breaks its psychological resistance of 2.00. Patiently waiting if the breakout will be sustained. While observing TUGS' price fluctuating up and down - like it is in a state of limbo after breaking 2.00 - at the back of my mind I was afraid because it might turn into another failed breakout and eventually makes it a failed trade, AGAIN. But I was resolute and didn't let the fear creeps in - let the chart be my guide and be objective about it. Then, I saw that lower high at the RSI (Point B) which is a recipe for a bearish divergence ( Price is HIGHER HIGH while RSI is LOWER HIGH). Now that I have the first sign of weakness, I waited for the SMA20 breakdown to know that Big Volume Traders are already jumping off the ship.

As the price slowly touching sma20 coupled with decreasing RSI, I anticipated its sma20 breakdown so I decided to sell. Sold it at 2.18 (SAGASA mode) 

Buy and Sell Transactions

As it turns out, it made a short rally to 2.28 before breaking sma20. That short rally to 2.28 seems to be a bull trap. In fact it made triple peaks for the bearish divergence (POINTS A, B, C). 

It might not be a perfect day trade execution but it is my first successful objective day trade.

For perfect execution check Ideal Buy and Sell points.

I left the market with  ~8% gain in a single day ( I went All-in with my uncommitted buying powers on this trade ). I almost recovered all my losses during those failed breakout trades.


If not for the zoom in style of trading, this trade would have been another failed trade. End of Day Close of TUGS is a disaster.


End of Day Chart  of TUGS (1 min)
End of Day Chart of TUGS (1 Day)









This zoom in and zoom out style made a successful trade on a failed breakout. Big Thanks to Ms. Akio. 

A new arsenal on my trading system added.

Lessons learned :

1. You will have more conviction with your trades if you are trading objectively and with basis

2. When trading breakouts, buy 1-2 ticks above the breakout price (TUGS : breakout price 2.00, bought it at 2.01).
    Rationale behind: During breakouts, prices go up abruptly which takes only a sec or two to leave you behind. This is the reason why during those failed trades I didn't have the ideal entry price because I keep on chasing the price since I posted an order in which the price was already left behind. And eventually if it turned to be a failed breakout I didn't have enough leg room to make a sound decision which lead to a failed trade.

3. Try to study different timeframes of the stock you're eyeing and find the common pivot points on those timeframes.

4. "Always trade your plan no matter what the cost."



*UPDATE:


Here's a reward to myself for that successful trade:



        

"As Always Happy Investing and Stay Curious"



10 comments:

  1. Thanks for this.. I've had a few failed breakout plays lately.. This is a good reminder not to chase and plan entries and never try to play catch up..

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  2. Related much. Thanks for sharing.

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  3. Isn't 1.97 the previous ath for tugs?

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    Replies
    1. No mate. Check Price of TUGS last Oct. 30, 2013. 2.02 is its previous All Time High.
      I used COL chart btw.

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  4. Vita bounce is due on monday or tuesday next week. Good luck on that. :)

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    Replies
    1. Thanks for the heads-up but I can't play the bounce during those days due to work schedule. I've set rules that I will only trade bounce plays during my day offs.

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  5. Replies
    1. Thanks Sir Fullmetal Chartist :-) You're one of the tribe members right?

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