10/11/22

Grade: C+

Goals: Be more selective and raise winning %

Reminders/Aphorisms: 

  • Don't fight the trend;
  • Be patient, take good set-ups
  • Respect at least 2:1 R/R

Overview: As predicted yesterday was a tough day to trade but we had a strong sell-off at open rejecting the 362-363 zone and heading down to 358 before bouncing and then rejecting at 362-363 again. In the post/pre market we had been going down and bottomed at 356.31 before we started moving up again and are opening around previous day close. Keeping in the back of my mind that PPI comes out tomorrow and CPI comes out on Thursday. We are likely to bounce between the 358 and 362-363 level today. Potential scenarios today:

1) SPY/QQQ have a little relief pop back up to the 362-363 zone and then reject, moving past this zone created at 358 on strong volume, leading to a strong move down.

2) We sell off slightly to 358 where we get a bounce to 362-363;

3) We have a sharp sell-off which breaks down below 358 and either through the premarket low of 356.31 to the latest low of 355.08, or we bounce at that level and reverse.

Trade Analysis:

  • Trade 1 was a continuation downtrend trade. We had a big rejection off the 9 EMA and I got in a little late. I was looking for the big move through 357 which is the low on the daily chart. I am anticipating a strong move through that level on high volume but I got take out on a bounce on that level.
  • Trades 2 was a continuation downtrend trade. This was a similar trade as my earlier trade this time we had a higher bounce that was instantly rejected. As I saw that big rejection I marketed into the trade so I had some slippage. I held for my 50/25 R/R, and this flew down quickly in the next minute. Took my target and let the partial ride which I had to get out of on the first green candle at my 50c target after almost hitting the $1 mark. 
  • Trades 3 was a boredom trade with smaller size (35 shares) looking for a rejection of the prior supply zone at 358. I cut this relatively quickly when I noticed we were consolidating and looking like a continuation to the upside.
  • NOTES: There was a potential trade at 9:33 to go short off a quick pop and rejectioni at VWAP. However this was very early in the day and no established trend and I had to use the bathroom. There was another missed opportunity at around 10:31 when we were bouncing off the bottom of a wedge that was forming and premarket low. Could have gotten in looking for the top of the wedge which was 60c away, and held for a larger move. This would have been the 2nd leg of a trend reversal trade. While I'm happy that missing these strong trades didn't make me FOMO into trades, I need to start trusting myself and capitalizing on these larger moves and easy trades.

Lesson moving forward: Continue to stay disciplined. Don't go in with a bias, think of all posibilities. Don't be afraid to take proper setups even if I'm green.