Warrior Trading Blog

Finishing The Italian Trading Challenge +$6K | Ross’ Trade Recap


Hey everyone. All right, so we’ve come to the end of the Italian trading challenge. It’s been, well it’s been an amazing three weeks. It’s been a little disappointing as far as trading is concerned. Of course, started with a red week, first week of vacation. That’s never fun. Second week, made back all the losses from the first week, so that was good. You hear some thunder here overhead. Then this week made some good progress, but today’s going to be my first red day of July, down $6,600. You know, blew a little through my max loss, which I adjusted to $5,000 right now because I’m trading with bigger share size. Yeah, so that’s a little disappointing.

Started the trip I think pretty much with a red day. Finishing the trip with a red day. This just happens that this trip has coincided with a slow period in the market where I took some losses, and then things sort of starting to pick back up slowly, and then finishing with a little bit of a tough day. Not the best three week stretch, although I kind of like leaving and traveling during times that I don’t really expect peak market conditions because if I end up having Internet problems, if I have tech issues, or the power goes out, it’s not that big a deal. Whereas, during October, November, December, January, those are the times of the year where I really want to be able to be present, be at peak performance, have my computer, have my fiber internet connection, and everything else.

Anyways, I’ll be back in my office on Monday, back on the fiber. Try to make a little bit of money, start to recoup today’s loss, and move towards that $40,000 goal for the month of July, which is still within reach. We’ve got 13 trading days left this month. All right everyone, that’s it for me. I’ll see you guys first thing Monday morning.

All right, so we’ll do a quick midday market recap. I’ll just go over the trades that I took today real quick and just break down first red day of the month. I’m going to finish the day down $6,600, which is disappointing. It’s the biggest red day I’ve had in about two weeks. Last week was all green, up $14,000. This week, coming into today, I was up like, I don’t know, $12,000 or $13,000, and just cut that in half, so we’ll only be up about $6,000 or $7,000 on the week. That’s a little disappointing, but I am still up $20,000 on the month, which is good considering we’re right at the halfway point. Well, actually this is, we’re going to have a couple more trading days this month because we’ll have next week, the week after, and then we’ve got Monday, Tuesday, Wednesday, 29th, 30th, 31st. So we actually have 13 trading days left in the month, which is good.

But yeah, so hopefully we’ll be able to still hit the $40,000 monthly goal, but today did not help. I’m disappointed a little bit with the price action today. Obviously being red across the board, red on three stocks, is the opposite of how my P&L has looked pretty much every day in the last seven days. I had a seven day hot streak where I made $27,000. That just ended today with this $6,000 loss. That’s about, if you thought of it in percentages, 10 steps forward, 2 steps back. Losing this is about 20% or so of those gains. You know, I mean it’s all relative. For me, this is acceptable risk, but the winners are always clustered together and of course the losers are always clustered together because that’s trading based on hot or cold markets. When you’re trading in cold markets, you’ll find the losses seem to come back to back.

Today, leading gapper in the market was SGBX, gapping up 90%. The thing is, I really, I just, I wasn’t that into it and the trades I took on it really didn’t work out. I took a trade right in here, in this first kind of break out, thinking it was going to squeeze right up to 75 and make a move up to $2. It didn’t, and so my first loss was right here. Then you can see how it curled up. I got back in right here. That was a bull trap, but I didn’t know it at the time. I thought it was going to work. I thought first five minute candle to make a new high, and it just, the second I pressed the buy button, it dropped. I just, I was like all right, well that’s no good, so I just stopped right out. I didn’t have to hold through the halt or anything like that. It just hit the bid right here. But yeah, disappointing.

This is essentially what looks like it’s going to be a breakout, first candle to make a new high, and then to move higher. So, at the breakout point you have a lot of accumulation of buyers, which makes sense. People are buying for the breakout, me included. Then the moment that breakout fails, all those people who just bought, well they bail out plus short sellers will hit to the short side and people who’ve been holding through this consolidation with a stop down here, they bail out. So you have an imbalance, and it’s to the sell side. That’s what creates that, that sort of pop up, it fails, and then strong drop down. Of course if it had broken through this level, then that would have been resolution to the upside and it would’ve been a good setup. But yeah, SGPX, really disappointing one for me just because my two trades on it were both losers.

VVPR, also on the gap scanner, third or fourth leading gapper, up 32%. Tried to take a couple of trades on it and lost on both of them. First trade was right here. First one minute candle to make a new high. In for the break over 2.12 or 2.13. It hit a high of 2.18 and then dropped. Stopped out, took the loss. Got back in right here as this little pullback was forming, thinking it would do this breakout here now that it’s shown the strength of holding. It didn’t, and so I stopped out a second time. Lost 20, no lost 1,300 on that one, 2,400 on SGBX and OHRP. This stock hit the scanners. It squeezed up from a 410 up towards 5. I bought it at 4.90 for the break over 5. It hit a high of 5.15 and then immediately reversed. I stopped out of that for a $2,800 loss.

I increased my max loss to $5,000, which I think right now makes a little bit more sense given the share size I’ve been trading with. I’ve obviously been trading with 9,000 to 12,000 shares, so to have a max loss of $2,000 is kind of tough because that’s only a 20 cent loss, or maybe even only a 15 cent loss with full size, so I’ve given the loss a little bit more space, up to five, but obviously need to continue to be right 75% of the time in order to accommodate that. Today, obviously one of those days where if I had just thrown in the towel down $2,000, I would have stopped a lot sooner and I would have been better off for it. On other days, and namely on Wednesday, I was down $1,700. I was $300 off that max loss. Then I finished the day up $8,000. That was a day where absolutely trading past … Let’s say I had been down $2,100, you know an extra $400. It was the right thing for me to keep trading because we continued to have good opportunities.

Now today, since I’m red across the board, it’s not a good idea to keep trading. We’re not seeing good follow through. Overall, the market for small caps to the long side is pretty weak today. Definitely today’s a good day to stop, and maybe I should have stopped a little sooner. That set up on SGBX cost me an extra, I don’t know, $1,600 or $1,800. I wasn’t below five until that trade. I just, you know, it’s kind of annoying because I knew, it’s like I knew that it wasn’t really worth it because the thing I kept asking myself is how much is this really going to go, even if it works. The entry is at 65, the high day here is 75, the pre-market high is at 88. What are we talking about, 15, 20 cents at best. Is it even worth it? Then here it drops 25 cents. I took a full 10 or 15 cent loss on it, but … I don’t know, I didn’t really think it was worth it. I took the trade anyways and so that was my own fault. I wish I had just left that one alone, but …

Yeah, just we’re just not seeing it today, and that’s a bummer. But you know what, all things considered, I’m going to finish this week with more money than I started the week with, which is progress. That’s great. I’m going to finish up $20,000 on the month, which is really good. I’ve dug myself out of the hole for my first week of trading in Italy where I lost $14,000. But in total on this trip I’ll probably have only made about, in the course of three weeks, I lost $14,000, then I made back $14,000, and then this week I’m only up like $6,000. So, only $6,000 net profit for three weeks of trading. That that’s not great, but of course that’s just sometimes going to happen. If you have a little bit of a slow period and you lose some money, and then you spend the first week of the next hot streak kind of digging yourself out of the hole, the span of those two, three weeks won’t be particularly impressive.

As of right now, you guys can see my broker statements updated on the website at the end of each month. I finished the end of June. I’m just going to grab my P&L on the year. Let’s see, right around $257,000 at the end of June, which is good. I’m up now $267,000, $277,000. $277,000 right now on the year. The goal is still $500,000. I’m going to need to have a strong probably October, November, December to get there. I expect that the month of August will be a little slow. It’s that part of the summer where things tend to slow down a bit. What I’m probably going to do going into the month of August is take a bunch of money out of my account and just make it so even if I want to be aggressive, I can’t be that aggressive because my account is smaller. I think that will really preserve my equity through slow summer months of August. Then into September when things start to pick back up, the account will grow and I’ll be able to start being a little bit more aggressive.

Anyways, that’s kind of my game plan as we look at August. But interestingly, this week has been terrific. I mean, VISL … Last week was great. This week has been solid. Today, a little bit of a departure from these hot markets. I was really hoping it would be my eighth consecutive green day, but a little step back. That’s fine. Again, keeping it in perspective, if you get so hyper focused on just one day, you can get yourself bent out of shape, you can start getting way too aggressive. The big picture is one day, as long as you have reasonable risk management, one day will never make or break your career, so it really doesn’t matter. If it’s not a good day, just put that day away and finish it off and be done, and come back tomorrow.

That’s what I’m going to do today. There’s no reason I’m going to try to get bent out of shape to make this my eighth consecutive green day and go take a 15,000, 20,000 share position on the next stock that hits the high of day momo scanner. Not Worth it. Today’s not the day to be aggressive like that. We’ll take the red day, eat the loss, learn from it, and come back tomorrow, or on Monday back in my office and hopefully recharged, feeling good, and ready to keep making progress on the month of July towards that $40,000 goal. All right, so that’s it for me. I’ll see you guys first thing on Monday morning. Enjoy the weekend everyone.

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