August 17, 2003

Sill Wet Behind The Ears

I’ve been trading since January, not long by anyone’s standards. I came into the field without much of a clue, but here I am, after seven months, still at it. Every day’s a struggle; some days I lose the fight but hopefully, emerge a bit wiser from it. I thought I would start this log as a way of tracking my run at making this my continued profession. I’ll share my thoughts on trading as well as my actual trades. I’m hoping that by laying my record out for all to see, I’ll become a bit more disciplined in my trading habits and have a log of the past that I can refer back to. If any of you learn a thing or two, or, more likely, are amused by my lack of trading acumen, then all the better! One caveat; please do not hold me responsible for any trading techniques or ideas that you use and lose money with. I am not a professional and what you read here is from my own experience. Trading can be an easy way to lose money. Please do so at your own risk. Of course, if, after reading this site, you make money, all your base are belong to us!

August 18, 2003

Why Drive When You Can Walk

Monday morning, the start of the trading week! I didn’t sleep too well last night, kept dreaming about my trades. In my previous life, weekends were never long enough. Not that I hated my job, but I’d prefer days away from the office rather than days in the office. I saw a bumper sticker a while back that expressed the sentiment pretty well: The worst day of fishing is still better than the best day at work. But now that I’m a trader, I look forward to Mondays. My morning commute is pretty sweet. I generally wake up around 7:00am and walk 15 feet from the bedroom to my home office. As I said, I didn’t sleep too well last night and so, got up around 6:30am. The first thing I do in my office is turn on CNBC. I look to see how the futures are behaving from the ticker in the lower right of the television screen. NAS Futures are up 4.50 today and the DJ Futures are up 21.00. It’s still early, another hour until the opening bell, but this gives me some indication of what the day may hold. Next I print out the day’s pick list. These are the stocks that I’ll watch today. I may play others as well, but these are my most likely winning candidates. I type these into my charting software’s quote page to get real-time prices and volume during the day. In addition to my charting package, I also run an IRC client and the software that I place my trades through. IRC is a form of instant messaging that’s been around awhile. It allows me to “talk” to other traders throughout the day. One of the problems that some traders have when they work from their own homes is the solitude. Through IRC, I connect to two trading chat rooms that I monitor during the trading day. I don’t mind the solitude but it’s nice to have other traders to communicate with when I have questions and to help watch the trading action.

Not Bad For A Rookie

The market was strong today. Nasdaq up 2.2% to close at 1739.49 and the Dow finished up 1% at 9412.45. It was a good day for me too as I ended the day in the green. I made a few mistakes (doh!) with my shorts but didn’t throw ALL my profits away . Today, I only traded SSFs (Single Stock Futures). It’s a new instrument for me and I’m just starting to feel comfortable with them. They have some benefits but also some weaknesses when compared to equities. I had two AXP September 2003 contracts and four BRCM September 2003 contracts that I held over the weekend, I don’t normally like to hold anything overnight, but unlike equities, there is no after market trading on SSFs and I didn’t get rid of them before the close on Friday. I wasn’t too worried, they’re good companies and I didn’t expect anything crazy to happen to them over the weekend. But, you never know, and to play it safe, I don’t like to hold overnight.

As it turned out, BRCM made a quick jump and then looked like it might have some resistance at R2 (21.97). I sold at 21.90 thinking that the stock was near its high for the day and might bounce off of R2. I had entered on Friday at an average price of 21.51 and so with 4 contracts (100 shares each), I had made $160. Not bad... But no, BRCM only stopped for a breather and then marched on up to around 22.75 where it retraced a bit and then continued to climb up past 23. This all would have been fine if I had been content with my short ride. But noooooo, I got a bit greedy and tried to play it short a few times, chasing it up to 23 and getting stopped out along the way. I let my $160 profit dwindle to about $16. *Sigh*

Fortunately, I did better with AXP and DELL, selling the former at 45.77 for a profit of $46 and making about $165 on the latter. I should’ve let DELL continue to run but it had trouble with R1 (32.83) and so I sold, trying to hang onto some profit. I bought some a little later and with the trade, added a few dollars to my kitty.

August 19, 2003

Another Day, Another Dollar

I went for the semiconductor stocks today, focusing on SSFs for KLAC, NVLS, and QLGC. I also bought a contract on BRCM. It’s been hot lately due to a rumor that Intel might buy them. When I thought the initial opening pop was over and stocks had come down to their first low before climbing, I bought. Unfortunately, I was a bit early and my stocks were seeking a more comfortable place to land a little further on down. I stuck with them, though perhaps I should have sold and reentered at a better price because, at the end of the day, I was stuck with them. Everything remained pretty flat and I was confident that they would come back. The only one that made any progress was KLAC. I sold it and ended the day up $127. I saved the others for a better day.