Frustrating day today although I guess there are a few lessons to be learned. I was down a lot in the morning and then made it all back and was flat before going right back to where I was in the morning by the end of the day.
Basically a list of things to remember going forward:
1. Don't short a stock above its offering price even if it sets up for it.
2. If you actually take a trade then it means you are fully committed to it and that means it has to be good enough for you to risk over/under on and give it enough room. There should be no breakeven trades just because you are afraid of losing money. That is bad process assuming it is a good trade.
3. Don't try to pick the top on something even though it looks good. Today on WTW it had big volume and had a certain pattern running right into daily chart resistance. Of course looking back it was crowded short and whenever the small amount of times I do think "this should be easy" is when I should probably do the opposite. Also, the big volume running into resistance hasn't been a good setup as it has never worked for me so just because it is doing that, I will not be taking that trade from now on.
4. On the things you expect to just go up or down a bit, they end up going a lot higher/lower. The stuff you have high expectations for usually don't work out so well probably because everyone is thinking the same thing. Keep that in mind.
5. I keep seeing that these big volume spikes don't have much to do with anything. It is really contextual. I can't just make a trade based on the volume. Of course I have seen it work time and time again but perhaps it is more on the low floats. It works occasionally on larger cap stocks as well but that should not be my only reason for taking a trade.
6. What I said yesterday - the chart can do anything. S/R are the only thing that matters.
7. Don't bother with iffy trades.
8. Today I traded LABU today and I honestly don't know what I saw with each pattern I took. I really don't know what I saw. I have to so much more aware of being sure what I am seeing is actually what is there - as weird as that sounds due to me being a very visual person. This was my biggest losing ticker today for that exact reason. After I had one bad trade on it, I did another bad trade on it which cost me even more. My initial idea ended up being the correct idea and it was using higher timeframe S/R! I said it would retest the breakout area as support and then go higher which is exactly what it did!! Keep that in mind going forward.
9. Don't discount what SPY is doing when trading certain stocks.
10. No bullshit trades.
11. Use the level 2 sparingly. On CLVS, there was a seller there but he eventually got bought up and the stock was a trender the entire day so don't discount what it is doing based on the level 2. In most cases, the level 2 will harm you.
12. Use S/R despite fake highs/lows.
13. Don't have high hopes for a miracle flush or something to make a trade worth it, especially at EOD.
14. I think just stick with the 5min and use the 3min for when you are really considering something.
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