Live by the Sword, Die by the Sword

Well I am realizing the pitfalls of being a "momo" guy. Volatility presents opportunity, but you need to have time to wait for the right opportunity, jump in quickly, and the get out. For me, I have a day job and so I don't always have control of when I can trade. That used to mean I would try to swingtrade only, but in this environment it is still to dangerous to swingtrade for the momo stocks (maybe for the sleeper stocks). My whole philosophy is to try to capture money using short term movements in volatile stocks, but these gains can easily turn into losses, or easily be wiped out by the morning gap, as I recently learned for the umpteenth time.

To give a real example, last Friday I bought a QQQQ call. The day went great, and everyone was predicting a nice gap up on Monday. So I kept the trade on. On Monday, the market did exactly the opposite: tanked especially into the close. I had to go to the gym 1 hour before the stock market close on Monday, so I loosened my stop to just below recent support, and I went away. Bad move. My loose stop got hit as the market reversed hard and tanked in the final hour. To make maters worse, we rallied today, so that if I had stayed in, I might have been OK.

Lessons learned: (1) If you loosen up your stop to make it below support, you better recalculate the amount you could lose (your risk) -- and if you don't like the results - JUST DON'T DO IT.

Also, (2) the first and last hour are very important. If you can't be there for the final hour, don't try to "set it and forget it" or just "hope for the best." Hope does not belong to any trading plan.

That's why I am retiring my old username on Wallstreak: HopeToGetRich (HTGR). Bye Bye HTGR!

OK well I am taking a break for a few days . I need time to collect myself. Luckily it was only a very small amount of money I lost, but mistakes are good if you learn from them.