Warrior Trading Blog

Day 47 of the $100k Challenge -2.2k | Ep. #51


Day 47 of the $100k Challenge -2.2k | Ep. #51

All right, guys. We’re going to do a little midday market recap here, go over the trades from today. Today’s Day 47 of the $100,000 challenge. Thankfully, I broke $100,000 last Wednesday on Day 44 because as of now I’ve dipped back below 100. I was red on Friday and I’m red again today, down $2,282.

Obviously, kind of disappointing to be in a two-day cold streak here. There was just no follow-through on Friday and I ended up getting stopped out pretty hard on a trade that I took off the high of day scanner.

Today, no follow-through on my first two trades on CERU short, stopped out break even. Yahoo short, I stopped out for a small loss, $177 loss. Then AUXO, this one I guess I could have been maybe more cautious on this one. I got in it because on Friday it spiked here from $4.40 up to $5.60.

I didn’t trade it, but I saw that big spike and I felt like I missed an opportunity there. It’s also a stock that was really active earlier in the week, last week, from $4 up to $5.40. I was like, “All right, well it’s gapping up slightly. If it starts to get a little volume I might get in.”

I jumped in at $5.50 in this candle here thinking that we would break over the high of day, which at that time was $5.45. We would squeeze up $5.50. Yesterday’s high was $5.50. Then we could potentially first target $6.

We pop up to a high of $5.85, which is great, and then we drop all the way down to $5.12. That’s like 70-cent range here, up to 85, down to $5.12, and I held through the pullback and I held through the consolidation and we started to make a move back up towards the high.

We got back up from my $5.50 average, back up to $5.69. I thought, “Okay, well maybe this is going to get back up to the highs.” I don’t normally like to hold through a pullback, but this is one of the problems with buying a stock that’s extended.

I do this fairly often, and sometimes I fall into this type of situation where I buy a stock that’s fairly extended, it pulls back, and then I feel like, “Well, now it’s pulling back to support and I don’t want to sell it on support. I’d rather wait for it to break support.”

But, I am still red 30 cents or 40 cents on the name so what’s the right thing to do, to stop out because I’m red or to keep the stop at support? It depends, but in this case I decided to just keep my stock below support of the nine moving average.

We tapped down for a second, came back up, made our way back up to 69, so I went from down 30, 40 cents to up, back up 20 cents, and then in this candle here as we broke back below the half dollar $5.50 I threw in the towel.

Stopped out and got filled at five, an average of $5.30, 33 and 34. I got a little slippage on the way down and gave back some profit on it. Well, I’ve never had profit on it, really, but I went red on the name.

Just a little disappointing. This obviously wasn’t the cleanest setup. The five-minute with this big Doji wasn’t a very good daily because of the last two high candles having Doji tops, these tall topping tail wicks.

Just not a very good day, and the result is I traded maybe less than a quality setups and gave back profit. By being more disciplined and trading just the best quality setups I’m definitely much more likely to have better results. I think that’s probably the thing to focus on going into tomorrow.

Today we had some good volatility on AUPH, but really only in this first move here from $8.80 up to $9.80. The problem with this one for me is that by the time I saw it moving it had already gotten up all the way to $9.34 and I felt like, “Well, it’s extended,” and I said, “Look, there’ll be people who buy this over $9.34 because it’s strong, but it’s kind of higher risk here. I’m not sure it’s going to follow through.”

Ended up going up to 74 from that point, and then in this candle dropping all the way back down to 40. You just have to realize when you’re buying these stocks that extended, that you can have those quick pullbacks that either give back on realized profit or put you in the red if you get in too high.

We had that one. We also had CERU, which I didn’t feel super interested in this one. Right out of the gates, on the first candle it seemed very choppy and then it ended up redeeming itself, bouncing off the lows and squeezing up.

In hindsight, it was a good red to green move, but I didn’t take it. FATE, F-A-T-E, was on here. Let’s see. That one obviously went red as soon as the market opened, so not very clean on that setup. This one was, I think, fairly extended by the time the bell was about to ring, so I wasn’t super interested.

Basically, today was a day where we didn’t have a lot of good setups on the gaps scanner. We haven’t had any good reversals. Yahoo was the only one we had.

It didn’t end up working, and the few stocks that were gapping up like FATE, CERU, for me just didn’t really play out. AUXO minimized the loss on it, I suppose. Had the opportunity to get back out, break even, but I didn’t take that opportunity. Instead, I tried to hold it for the bigger move.

I ended up holding that one for like, I don’t know, half an hour or something, which is longer than I typically would hold those, but in any case I gave it time to work.

Finishing the day in the red, which is disappointing. I made 300 on Thursday, lost 3,000 on Friday, losing 2,000 today. Like we’ve seen with that equity curve, a few steps up, broke through 100,000, got up to 101,000, and now pulling back a little bit. Down to 98,000 today and 96,000 tomorrow when I open. That’s just part of the deal.

There’s no such thing as going straight up. You go up, you come down a little bit, and then get ready for the next move up. For me, I just have to make sure I focus on good quality setups.

The problem with AUXO is that by the time I was in the trade, I felt like I was in with too big of a position just to quickly mark it out of it. I knew there’d be slippage, and so I just decided to see it through.

I’d like to avoid getting myself into those situations if I can, but this is one of these things that can be a little hard at times to anticipate which one is going to be the one that goes from $5.50 to $6 to $6.50 and which one’s going to go to $5.85 and then back down to $5.12. Obviously, if I knew, it would be really easy for me to be 100% successful, but I don’t.

I base these decisions on what I’ve seen in the past, historically what typically works, and AUXO is just part of the 35% of the time that I’m wrong. Maybe I could’ve avoided the trade by being more mindful that the daily wasn’t that strong, and today may have been a day that, because I didn’t see any A-quality setups, I changed my filter to take B-quality setups so I could just trade.

As a trader, it’s hard to have a day in the market where you don’t trade at all, but sometimes that really is the best decision. I think today that would’ve been a better approach, considering the fact that I missed CERU and I missed AUPH and the names I did trade didn’t work out super well.

All right. Again, this is one of those times where as part of this challenge I show the green days, so of course I loved showing last Monday, Tuesday and Wednesday when I made $20,000 in three days, and now I have to show you Friday losing $3,500 and Monday losing $2,200, so two days where I lost $5,000. Still, if each step is a $5,000 step, that’s four steps up and one step back.

I retrace 25% and hopefully I’ll base out tomorrow and surge into Tuesday, Wednesday, maybe Thursday and then slow down going into the weekend. That’s the thought in the back of my mind, but for right now we’ll take what the market’s willing to give us and hopefully tomorrow we’ve got some good gappers, some good momentum, some good opportunities, but if not I will definitely be a little more conservative. I’d rather sit on my hands than have a third red day in a row.

That’s the thing. Statistically, after a couple of red days, yes, I’m much more likely to have a green day, but at the same time I really just want to get myself … Shift the momentum back into being green and put the red days behind me.

Hopefully I’ll be able to do that tomorrow, and I will be back at it first thing tomorrow morning putting together the watch list right around 9 am. All right, guys, any questions you can put them in the comments below for those of you watching on YouTube or Facebook, and for those of you in the chat I’ll answer questions now. All right. Thanks, guys.

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