Warrior Trading Blog

Day 105 – Red Day Recap: Losing -$5.5k in 30min

Buy To Cover

Day 105 – Red Day Recap: Losing -$5.5k in 30min


What’s up, guys? All right, so we’re going to do our midday market recap, though I barely even want to. Today was not a fun day for me. Today was a day that I let frustration get the best of me.

Earlier this week, I under-leveraged myself on OHGI. OHGI is the stock on, I think it was Tuesday, that went from $.80 up to $1.79, and I didn’t fully take advantage of this set up. I got my position at a dollar … I think it was a dollar … What day was … I got to scroll back here on the one-minute chart, I got my position on this at a $1.50 with 10,000 shares and I rode the momentum up to $1.79 and I made like $2,200 and then I gave back 1,000 and finished the day up only $1,000.

What I said is that I should have taken 20,000 shares because then I could have actually made a decent profit on that $.20 sense of profit, $.20 per share that I had, I said that. You can go back to the video and you’ll see that I said that that I should taken 20,000 shares.

Today, when I saw ABIL pop up, now let’s look at the daily chart in OHGI, just a little comparison here, daily chart on this was it squeezed up from $.68 up to about a $1.30, $1.40 this morning, and it had room up to the 200 moving average, which is at 237. Similar looking charts, that’s OHGI here on my screen share for those of you watching on Facebook, there’s OHGI. That’s our OHGI chart. Then, we have ABIL.

Here’s our ABIL chart. Pretty similar, lots of room up to the 200 moving average, curling out of this low from about $.60 starting to squeeze up. When I saw that I was like, “This looks good. This looks so much like OHGI yesterday or the day before, I’m going to jump in and I’m going to take 20,000 shares this time because that’s what I had wished I had done on the last OHGI, on the last trade of a very similar stock.” There’s a little bit of a mistake here though, on OHGI, I waited for a one minute micro pullback and that’s when I got in, after the micro pullback.

On this one, I decided not to wait, I just jumped in. I started getting in at $1.35 and I was pressing my hot keys. What I didn’t realize is that almost my entire … This is actually quite annoying, I started trying to get in at $1.38 and I ended up getting filled at $1.50. I got filled at the very top of my limit order and I didn’t … that’s about at least five or eight cents higher than I wanted to get filled.

I want to be in around $1.40, $1.38 so I filled at $1.50. We squeezed up to a high $1.58 and we were halted. I was like, “Okay. You know what? This is fine. This is exactly like OHGI the other day, squeezing up getting halted and going higher.” We squeezed up to $1.69, so I was up $4,000 on the ask roughly, but obviously that was on the one minute chart, and in that one minute we went from $1.69 all the way down to $1.31.

I went from being up $.20 to down $.20, so I went from up $4,000 to down $4,000. I said, “All right, well, that’s not exactly what I was expecting this to do. Now I have to hold through the five-minute flag. I’m not going to sell this as it comes down to support. Now I just have to hold this.”

I mean, I could’ve bailed out at $1.35 or $1.40 right here, but I felt if I did that I’d be selling on support and I don’t want to sell on support. I want to buy on support and sell on the move away. What I ended up doing is I bought on the extension, had to hold as we came down to support them, and as I was holding through this I was down $3,500, $4,000, and I was like,

“Well, this obviously isn’t looking good, but I’m going to let it consolidate on the five-minute chart and I’m going to wait for the first five-minute candle to make a new high.” You can see right here the high on this candle was $1.49. That was the level I was watching. Had we been broken over $1.49, I think there’s a really good chance we would have gone back to $1.69, $1.70 and moved higher. Unfortunately, that’s now what happened.

Right here, we popped up to $1.49, I went back to breakeven only for a second and then we came back down here and I stopped out on this candle right here, 200,000 shares of volume on that candle. I stopped out for a $5,500 loss.

That’s a little disappointing, right? It’s disappointing because this is the [inaudible 00:05:32] day I’ve had in over a month. I was stepping up to the plate, trying to be aggressive, I’ve been getting a little frustrated with the fact that the last month has been no home-run trades, and that even the trades that looked really good that could’ve been a home run, I didn’t position myself strongly enough to get a big win. So, when I saw this squeezing up, I thought it looked was so similar to OHGI that I would just jump right in it.

I think I made two mistakes on this trade. I think the first mistake I made is I didn’t wait for a pullback. I should’ve waited for a pullback. Now, if I had waited for a pullback, I actually probably wouldn’t have taken this trade at all because we actually never really got a clean pullback. We got this five-minute pullback but that didn’t actually set up because we didn’t make the new high.

We didn’t break over the half-dollar, so that didn’t end up giving me an entry so I wouldn’t have taken that trade. If I had waited for the pullback, I wouldn’t have taken a trade on this and that certainly would have saved me $5,000. First mistake was not waiting for a pullback. That’s really the biggest mistake. Instead of waiting for that pullback, I just jumped in as the stock squeezing.

Now, that would’ve worked on OHGI on Tuesday. It would’ve worked on OHGI because out of the first halt, it squeezed higher into a second halt. It just continued higher. There are times when that works but it’s always aggressive, and if you’re going to buy into an extension, you don’t go in with full position. You start with smaller size, you take a little profit and then on the first pullback that’s when you go in with a full position. You take this first trade as an opportunity to build your cushion with 5,000 or 7,500 shares. You don’t start with 20,000. Mistake number one was I a bought into an extension.

Now, that’s not exactly a mistake because there are times when that does work, but the mistake was that I over positioned myself on a high risk trade, buying into the extension and then we came down to support, of course I didn’t want to bail out and sell on support. That doesn’t make sense. You don’t want to sell on support. The chart didn’t tell me to get out until we broke down right here. My exit indicator made sense based on the chart but my entry did not. That was really the problem.

I made a note to myself only by both [inaudible 00:08:24] pullbacks for whatever, the rest of the week or next week or something. Buying that extension was … it just positioned me in a very weak spot and I needed it to work instantly or my downside risk was really high. Yes, I was up $.20 on this trade for a moment, but those $.20 quickly disappeared and turned into a $.20 loss, which ended up being a $.30 loss as I stopped out right as we broke the 20 moving average, at 22 or 25.