Trading Journal Jan 2019

Trading Journal - Jan 2019

• Be more reactive to price action
• Do not go against the general trend

Real Money Department

My main lesson learnt for this month is that I have reacted too slowly to price action. While SPY have been rising for the entire month, I kept on waiting for an opportunity to short believing that a double bottom will occur. I even went on to take a short on 16 Jan on a bearish pinbar. In retrospect, the "bearish pinbar" wasn't even as ideal. I only covered the losing short and opened a long position on SPY during the last day of Jan.

Similarly, based on my belief, I continued taking short position on other stocks. Going against the general market sentiment the entire month. Needless to say, this is a rather bad month for me with a loss in my portfolio.

Going forward, I am trying to react faster to price action. However, I also understand that this would result in me being more susceptible to "background noises" and going in the wrong direction. But we'll see how this play out. As for now, I will be long on the SPY, and getting ready to exit on resistance of 280, and short if any bearish momentum appears.

Paper Money Department

This is just a reflection of my real money, and even magnified. I ended the month with over -20R. Losing on many trades that showed the proper set-up and even confirmation candles (some even for 3 days). But as i enter, the direction reversed. 

Trading Journal Dec 2018

Paper Money Department

After 3-4 months of paper trading, I finally managed profit, and squeezed into the top of the leaderboard. This is a combination of good luck (S&P 500 declined for 10-straight days!) and the lesson accumulated thus far. There are still many lessons to be learnt though.

Stochastics and Bollinger Bands

Initially I was starting to feel that stochastics are a more reliable indicator than the 3 that I am currently using now (PSAR, MACD, FI). But after checking out the stats of my trading journal, it seems that I am having a false impression and this isn't really true. I am, however, still interested in (and am going to) learning how to use this indicator to its potential. And in the broader picture, my goal is to read more and master technical analysis.

Maximising Profits?

After last month's experiences, R:R was set to 1.5R. After 2 successful trades at 1.5R each, and knowing that more (2R) could be achieved, I started to have a R:R ratio of 2 again. Moreover, with the S&P 500 heavy decline, I shifted down my profit target further, but still did not managed to capture the max possible profit. Instead, EXPE did not managed to hit target and retraced, resulting in a lower profit achieved.

Therefore, the question is post is: Is there a way to ensure maximize profits without risking much of your unrealized profits? Is it worth it, or should we just stick with the pre-defined 1.5R/2R? After all, getting the "max" profit is equivalent to timing the bottom of the market... I will continue to experiment this.

Real Money Department

Things on the other hand haven't been so well. In an attempt to get more profits, I risked most of my unrealised profits, from a total of 2k to a mere 200. I really kicked myself hard on this one...

Nonetheless, my portfolio now (in 100% cash):

Initial Capital	Current Capital	P/L %
20000	20566	2.83

Readings

• The Intelligent Investor (Completed)
• Trade Like a Stock Market Wizard - Mark Minervini (Chapter 5)