Monday, May 17, 2010

Takin it easy

I've got a lot going on at work and I realized that it is hard to play in the current environment without trigger fingers, so I am trying to take it easy and just not touch my accounts too much. I got stuck in one long position that I am waiting to get out of when we get a short-covering rally sometime this OPEX week, and then I've kept my now nearly useless LVS puts just in case we have another black swan event before Friday. You never know what can happen - we could be shooting up or down ...

Wednesday, May 12, 2010

Rules & Suggestions Updated Again

OK communicated with  Stewie and I've updated my rules again:

1. no more than 2% risk per trade.
2 if using options must have 300 or more volume.

Suggestion:
1. try to move stop up as soon as break even.

The problem with moving up your stop to break even as soon as possible is that it may cause you to stop out especially if the stop is at an unnatural point. As long as you are comfortable with your per trade risk and your stop is in, you should let the trade work. It is still nice in concept to move your stop to break even, but it may reduce the effectiveness of the trade. Therefore making this a suggestion, not a rule.

2. - is a rule because I am still tired of dealing with market makers that want to screw with you when you try to exit out of an option - lowering their bid when you lower your ask etc - as happened to me yesterday in HOG. In fact after talking to Stewie I am going to use options for now because I am trying to get back to basics here, and there are all these other factors with options: expiration, time premium, delta etc. are a lot to handle in a market that has so much volatility anyway.

Ok doing well, passed Day 4 of not overtrading. This was hard as both NETL and LULU and others such as NFLX ran up and were tempting to chase. Even the SY buyout rumors were hard not to chase. But there will always be opportunities.

Tuesday, May 11, 2010

Updated Rules

1. risk no more than 2% of the account size on the trade
2. if using options can't buy any with less than 300 volume on that strike and that day.
3. only stewie alerts for 87 more days (completed day 3).
4. move up stop to break-even as soon as you can.

Monday, May 10, 2010

This game isn't fair

A fellow trader told me he suspects there was no computer error on Thursday - it was just Wall Street as usual playing their games. They play the music, and when it stops we scramble for the chairs, but we don't get told in advance when the music will stop. I had sold out of my LVS longs which I would have loved to have back to sell at this mornings gap up, and I am now holding some LVS puts which are ridicuously worthless unless I have the courage to hold them until the next "Black Swan" event probably coming in a few days - hey OPEX is coming up! In any case, I can complain all I want - I am choosing to swim in this wave pool -- so it is my fault for trading emotionally, hence no more non-Stewie trades for 90 days. Technically this is day 2 so about 88 more days.

Thursday, May 6, 2010

The Great Canadian Minebuster

When I was a youth I would visit Canada's Wonderland (the Canadian equivalent of Disney World) and the meanest, baddest roller coaster was the wooden Great Canadian Minebuster. It was terrifying then, and was terrifying a year ago, when I went back at age 39 to do it again with my 8 year old sun. That is what it felt like today in the stock market. As we approached the cliff I sold out of my LVS and RIMM calls at a total 80-90% loss just so that they wouldn't go to zero. I made  a few bucks  buying and then selling a MOS put as per an alert. I flipped into some puts (the stock didn't matter at that point) as the big drop happened and they went up over 100% -- but then I didn't sell because I was out of daytrades in this account - I'd have to wait for tommorow. No problem-- this drop was was so big we'd be gapping down tommorow. But no---- all of the sudden the market rebounded just as fast as it had dropped. By the end of the day my puts were DOWN. In my other account where I had bought some puts at the bottom, as the rocket up happened, the big money I paid for the put evaporated and it turned negative. Oh my goodness. Well I should have sat out or not reacted or gone back to work (I tried) but anyway.. this sucks. I am now seeing if my broker will cancel one or more of the trades due to the fact that the nasdaq is cancelling trades as it was all related to some computer glitch. We'll see what happens. From now on, for the next 90 days, I 'm back to day 1 starting tommorow and trading ONLY stewie trades. He will also help me decide what do do in which account - I don't have any ability to decide this myself anymore - whatever I do doesn't work. Arhgghghhh.