Post-mortem 2019W06-W07

This month, I started doing things differently. I found an accountability partner who advised me to trade using the same amount as my real portfolio. That way I would be familiarized on same amount figures. So I reset my capital from 50K to the same amount as my original real portfolio.

2019W06

My Portfolio Details for W06 (Open Positions)

Closed Trades for W06

1. OPEN TRADE A- Gap up (GU) at open. Broke out of DB Box (DB BO) and 3M High (3M BO). I resisted buying. I thought of waiting for more volume or wait for EOD. Price went back inside DB Box at recess. Closed at 13.00. Confirmed BO. I bought my first tranche (TR1) at EOD. BO follow up candle the next day. Bought TR2 at 13.32 intraday within BR.
2. OPEN TRADE B - DB BO intraday (14.00). Bought TR1 at 14.10 intraday. ATH is at 14.22. Good closing candle at 14.20. BO of ATH (14.22) the next day. Bought my TR2 at 14.40 intraday. Closed at 14.60.
3. HOUSE - ATH BO (10.50). Bought TR1 at 10.52. Whipsaw intraday. Had to Cut Loss (CL) at 10.36. Closed at 10.48. New ATH at 10.60. Will wait for BO of new ATH.
4. ABA - No BO but closed within my BR. Didn’t buy at 0.75 EOD price. Changed my DB box from body-to-body to wick-to-wick. Moved my entry from 0.76 (body) to 0.78 (wick). The next day I woke up with a disclosure from ABA. Massive BA at open. Skipped over my BR. Didn’t bother chasing. But watched closely as it may BO of the next resistance at 0.92. It did BO of 0.92 but I didn’t buy. Thought it was not planned. But felt FOMO – if I have just bought at 0.75 last Monday when it was still within my BR, I would’ve gained approximately 20% when it hit my original TP of 0.92. TF if it BO of 0.92. 
5. OPEN TRADE C - 9M BO at EOD. Bought TR1 at 11.90 EOD Price. Chose to enter DNL over BLOOM. Thought bloom was moving too slow. Hesitant to take this trade as the RRR is not that good (against BLOOM or other stocks on priority list) but my system’s rules were telling me to enter the trade. Gotta follow my system. Price went below BO point the next day. I was ready to CL at 11.68. Price went back up to 11.90 at recess. Was confused why there is a huge amount of sellers at 11.90. I revisited the chart realized I missed to plot one resistance using the candle’s wick at 11.90. Closed at 11.78 below BO point (11.80). I held. CL level at 11.68.
6. GREEN - GU at open. BO of flag at 3.20. I looked closely at Bid & Ask Board to see how fast the ask side is eaten up by buyers. Price reached 3.24 and I decided to buy within BR. Bought at 3.25. But price immediately went back down. CL executed at 3.20 just a few minutes after buying.

Observation and Comments

1. I get too excited and overwhelmed when several of the stocks on my watch list (WL) are breaking out one after the other. Only to end the day with some of them as Fake Outs (FO).
2. Now that I compiled my daily journal notes into a weekly one. I noticed I am watching too many stocks at the same time in a day.
3. I had a separate conversation with two traders. They both said that I had too many stocks on my WL.
4.  I had several hesitations.
• Hesitating to buy ABA at 0.75 with a long green candle and with volume (signs of strong close).
• Hesitating to enter DNL with a not so good RRR.
5. I’m afraid to enter at the lower range of my BR (3% before BO). It felt safer to enter after BO or at the higher range (+3% after BO) causing me to have a high AEP. Pulling my CL level closer to or at BO point.
6. I revised a few of my entries intra-week (GREEN).
7. I have strictly followed my CL level. 2 CL within max -4% range.
8. 2 CL and 3 open positions seem too many trades for one week.
9. I missed several BOs of stock which transitioned to AOTS intraweek.

Suggested Fix/Solutions

1. TRADER DEVELOPMENT - Yuri advised to trim WL by filtering stocks by ‘Value Traded’. Trade only stocks that have more than 10M value traded for liquidity reasons (depends on how port size and position size).
2. TRADER DEVELOPMENT - FMC advised to choose only the ‘best trades’ from my WL. Ideal number of 5 on my priority list with best RRR.
3. Trimming my WL and focusing on the best trades with the best RRR can cut me some stress on watching each stock and somehow remove my hesitations to hit the buy button and hesitations to enter at lower range of my BR. Because you should have no hesitations if you are already trading the best setups on your WL. A better word for it – CONVICTION.
4. Adjusting entries or exit to get me earlier in the trade or to hold my winners longer is acceptable as long as I planned it before market opens. Not during market hours.
5. Good job on following CL level! Risk management first.
6. Should setup a limit for the number of trades in a week to avoid overtrading. Together with No. 3,this fix should lessen my trades and focus on best trades only.
7.  Check screener list by EOD for stocks that transitioned to AOTS intraweek. 

2019W07 

My Portfolio Details for W07 (Open Positions)

Closed Trades for W07

1. OPEN TRADE A- Gap up (GU) at open. I watched as price approached BO point. ATH BO point was hit (10.60). I readied my Buy transaction. Price went higher fast. I hesitated to buy and thought of waiting EOD or at least let the newbie hour (NH) pass. But it was about to go out of my buying range (BR). I bought my first tranche (TR1) at 10.80 (10 cents away from my highest buying range). Closed at 11.00. I forgot to buy my TR2 at EOD. AEP at 10.83. Thursday - BO of flag. Bought my TR2 at 11.50 an hour before EOD. Closed at 11.82. ATH play.
2. DNL - Sold in the morning session. Went back below BO point. Cut loss (CL) at 2.52%.
3. EW - I was disappointed to execute another CL. But EW is still trying to reverse. So conviction is not that strong.
4. WLCON - Almost tempted to cut. Touched 14.20 (CL) in the morning but went back up slowly. But eventually I executed my CL after it touched my CL level the second time. CL at 1.41% loss. Went back up and closed at 14.60 at EOD. Weak hands. But I just followed my plan. Ended the week 16 cents below my CL.
5. OPEN TRADE B - Was thinking of BOSO intraday but I didn’t buy. Price BO after recess. Bought tranches at 13.60, 13.80 and 14.06. Palms sweaty during this time. Confirmed BO at EOD at 14.00. ATH play. 

Observation and Comments 

1. I still get too excited and overwhelmed when stocks on my watch list (WL) are breaking out. Especially the ones that are high probability plays like ATH play. Palms are sweaty. Heart beat kinda raising.
2. I get frustrated when I have to execute CL after CL. All my closed trades so far are CL. No winning trades yet.
3. I forgot to enter TR2 on confirmed BO EOD for HOUSE. I forgot that what I bought was only my TR1. 
4. With the current condition of the market (Sideways, coming from Down Trend), Most BO are fakeouts (FO).

Suggested Fix/Solutions 

1. Control my emotions. Remember that I already got a plan and there’s nothing to be excited or worried about. Just stick with the road map that I have planned for each scenarios and I’ll be good. Always refer to the plan. Follow them and you'll be fine.
2. I know that I have to accept that TF is all about lots of small losses and is focused on few big wins. I know this. But I have to accept it and live by it. Learn to accept it.
3. Wait for another entry opportunity if you missed buying your TR2 at BO. Wait for another BO. As it signals the strength of the trend and gives you more conviction to re-entry. 
4. TRADER DEVELOPMENT – Had a chat with one trader. I can refine my entries to BO of 6-9 months resistance instead of 3 months minimum. And prioritize uptrending stocks. If I want to enter reversing stocks on AOTS or a stock not on my WL made a BO, I can put a small allocation for TR1 (test buy). That way I can enter early in the trend but at the same time I am at a small risk if market goes against my bias.

The past two weeks have been a mix of frustration and excitement. Frustration of consecutive small losses and excitement of ATH play materializing. Somehow I was relieved of my frustrations when HOUSE made a significant move and also FDC after a long wait. Both are ATH plays. But with the overall market condition, I wouldn't be too complacent. I've seen so many breakouts turn to fakeouts and plays with no follow through or continuation. In times like this, I have to refine my system to adapt for this kind of market condition and be able to survive the season. And I have to be choosy when picking stocks to trade. Go with the best trades. We already know that Trend Following is all about lots of small losses and few big wins. But it doesn't justify to have lots of small losses just because.. It just shows the trader has an issue on picking stocks to trade. I have to refine my filtering system and be choosy on which stocks to trade. For a choppy and non-trending market is the worse combination for a Trend Follower.

Here's NINA talking about the struggles of a Trend Follower and how to overcome them.