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Warrior Trading Blog

Trade Recap: Too Aggressive and Down -$16k!

too aggressive

What’s up everyone. You probably didn’t see me I was just over there digging myself a hole. It’s a huge hole. $16,000 deep, it’s one of the biggest holes of all time. So I gave myself a project for the month of June and good thing I like challenges, because now I’ve gotta work myself out of the hole. Down $16,000 in one day, what is wrong with me?

 

Why was I so aggressive? I always do this, is at the beginning of the month that I just try to come out swinging for the fences, and get that big strike out. Three trades today, first trade right out of the gates, down 2700 bucks. Second trade $9,000 loss, I was trying to bounce back a little bit from the first trade, second trade I jumped in a little high, I chased it up and you know in a strong market I would’ve gotten away with it, probably would’ve been able to make $5-6,000 on it in the market that we were in today, boom dropped right back down, I got stopped out.

Third trade, I get in I’m up $7,000, do I take the profit? No. I don’t take the profit because being up $7,000 when you’re already down 12 grand, isn’t enough. That’s how your head screws with you when you have a big red day, and when it came back down I stopped out and got slippage on a 10,000 share position and lost another $4,000.

Down 16 grand on the day. Not a fun day, but we’re gonna do our midday market recap just like we do every single day so enjoy it. Go through any questions you have, put them down below, I’ll come back and answer them later this weekend. Alright so that’s it for me, I’ll see you guys back in the chat room Monday morning, and hope you enjoy the midday market recap.

Alright everyone, so we’re gonna do our midday market recap, go over the trades from today. This for me was an ugly day, worst day of the year, this is probably my worst single day of trading in, this might be my second worst day ever. I’m really disappointed. It’s a combination of things that went wrong and it’s what happens when you’re too aggressive, and when you trade with big size emotions start to get in, start to factor in and today I just made some decisions- I was being way too aggressive.

You don’t get to $280,000 on the year and by June 1st, by being conservative. You have to be aggressive and it’s just always walking that line of being just aggressive enough to maximize profit, and not too aggressive that you give back profit. That’s where it’s always a little bit of a challenge and sometimes we cross that line and we’re on the other side, and that’s when you have those big losses.

You just don’t really know where the line is until you start to cross it. That’s the thing that I think most traders experience probably every single one of us in the room have gone through it and had days where you’re trying to capitalize on opportunities, you’re trying to be aggressive and you just get knocked down. So I’m disappointed, this is not a good way to start the month, no doubt about it, but what I’m gonna do is I’m gonna put a little sticky note right here over June 1st, and we’re just gonna pretend that day didn’t even happen. I’m gonna start next Monday fresh head, clean slate, I’m not gonna worry about it. I’m not gonna try to dig myself out of the hole, I’m just gonna focus on Monday being a good day.

Now the month of June looks great. This is a good looking month. So we’ve got lots of opportunity here for a rebound and yes it is a red day, it’s a disappointing day, but you have to be able to bounce back and I’ve gotten knocked off the horse so many times I’m used to hitting the ground and getting right back up. So I’ll get right back up, its not a big deal, $16,000 certainly seems like a lot of money, it is a lot of money. Last month at this time in two days I made $60,000. So keep it in perspective, the numbers are big because the share size is big and it’s all relative.

For some of you guys who are beginner traders, $16,000 is maybe more than you’d make in six months of trading, and I remember when I was there, but you keep working at it, you’ll get to the place where I’m at where six months of trading is a quarter million dollars. $300,000 and so losing 16 grand in one day, yeah if you think of it as how many Chipotle burritos you could’ve bought, it seems like a lot but when you put it in the perspective of how much you’ve made and relative what that pull back is, it’s actually not that bad. So I was up $280,000 on the year before today so this is a 5% pull back on my PNL and that’s not out of the range of what’s tolerable for me.

I’ve had pull backs as sharp as about 20% and that’s par for the course when you’re being aggressive. So let’s look at the trades from today. You guys are gonna get to see the PNL of a big loss, which is fairly uncommon like I said, this will be probably the second biggest loss that I’ve ever had, the first biggest was $30,000. So the green days have been getting bigger, and bigger, and bigger the longer I’ve been trading, but the red days get bigger and bigger also because I’m stepping up to the plate with some big size. So what happened today?

Well right off the watch list we had two stocks Jag X, which was a maybe. This one was only a maybe because the float is awfully high, it’s a 126 million share float, but it is a recent reverse split, the reverse split was today and so as soon as I only put- sorry let me switch screens here, as soon as the bell rang, it started to take off. I didn’t think it would but it did and so I jumped in it as quickly as I could, but I got partial fills on it at 48 and 50 and then I added high, being a little aggressive, at 70 still getting partial fills, and then I added more at 320 and 320 and 320. So my average ended up being 285- 288.

So some of you guys got in at 250, which is where we were calling it out as a good entry, the half dollar. I was getting in way up here at $3.00, so I didn’t get a very good entry on this I had 10,000 shares. It’s halted, it resumes and I add coming out of the halt, right at 320 and then it instantly drops. Two minutes later it’s back at 206. So this is one of those things that 90% of the time stocks that halt going up, open higher and continue.

This is one of those times where it halted going up and it resumed, and it instantly turned around. This happened at some point earlier in the year, I don’t remember the stock, I mean its happened a couple other times. It doesn’t happen often but when it does it hurts. I was in at this point with the add, I was in at three, sorry 297 with 16,000 shares. The target for me was a tap of $4.00, which was the 200 moving average, that would have been a $16,000 winner, but that didn’t happen it dropped all the way back down to two and I stopped out on the way back down and I lost $9,000 on it.

That’s a pretty good size loss and here’s the thing, when you’re trading with 16,000 shares you can’t use stop orders. You can’t use stop orders because you can’t sell in one order. You can’t sell 16,000 shares in one block. You’ve gotta piece out of it, of course I piece out of it trying to sell at 59, 40, 50, 43, 23, I’m selling as it goes down and I’m not getting good fill. If you use an actual stop order, you would get destroyed by the market makers. So once you get to the point of trading with big size, you have to be able to handle not using stop orders, but this is the down side.

Again guys, this is right now, you’re kinda seeing the extremes of my strategy. Last month at this time, two days I made $60,000 and that’s being really aggressive. Not any different from today, today the market just was not on my side. So today’s a day where I was really aggressive and it didn’t work out, and so this is the downside of that. Now if you’re trading with a tenth of the share size as me, then your profits and losses will be a tenth of this number so you know relatively speaking. So Jag X that was a total fail, I just you know, it faked me out. I thought because it was squeezing up so quickly that it would continue and it just didn’t so I gave back some profit on that on.

My first trade of the day was SLS. This was on our watch list for a gap and go stock and again, this is- gaping up would news, I get in it at 685 and 695 with 7,500 shares and it promptly drops to 650. The gap and go strategy works most of the time but there are times where you’ll see this type of thing happen. So I lost $2,700 on that. So with these two trades I was down $12,000 on the day, and I was like I’m done for the day, I’m not gonna take anymore trades.

This is always that thing of I should have followed the God dang rules, because I got back in to CODX. I started to get FOMO. I see CODX squeeze up from 350 to four, and I wasn’t in it because I had just taken this big loss. Then it goes to 450, 475 to 500 and I’m like my God you’ve gotta be kidding me this thing is just running and I’m missing it, FOMO, emotions they’re running higher and higher and higher.

Next thing you know it taps four, 545 and is halted. This does the same thing, it halts and then it drops. On the drop I got in at 518, lets see, let me scroll down. I got in at 518, and 523, and 524. I got in with 7,500 shares. Let’s see I got in right out of the halt and it drops to 480 and I’m down $3,000, I was like you know at this point, I was at a place where I was like I’m just gonna set a stop at 450 and I’m gonna walk away, and if I come back in three hours and it’s at $8.00, then I’m a hero and if I come back and it’s stopped out then you know whatever.

So I just- so that’s where you see the emotions now because I’m at the kind of extremes of my PNL, the emotions are starting to pick up more and more. That’s where the trades become less and less calculated, they become more impulsive, more aggressive. That’s when you start to snowball and go further into the red almost always, now sometimes you do get a bailout and on this one I had 10,000 shares out of 537 average, and I held through the move to 594.

So that’s about $7,000, but I didn’t sell it. I didn’t sell it, I held it, because I wanted to see a break over $6.00 and being up $7,000 did not get me out of the hole, that wasn’t enough. So instead of taking the $7,000 profit and getting out, I held through this consolidation saying, thinking you know alright it’s consolidating it looks good for a move up to 684 which would be all time highs back here.

So that’s the level that I was watching and if that had happened, I would have gotten the bail out, I would have finished the day up $2-3,000 and I would have had a 12, 14, $15,000 winner on CODX. But instead it dropped on these two candles right here, broke the bottom of the flag, and I didn’t wanna stop out and then I finally stopped out when I was at pretty much my max loss of $4,000 on it. So this is the life of being a aggressive momentum break out trader.

I’m very, very fortunate, I’m sitting, even after today, I’m up $268 or $65,000 on the year. I’ve got nothing to complain about, I’m very successful but this is part of the deal when you step up to the play and you get aggressive. You’re gonna have the big green days and those are awesome, but then you’re gonna have the red days and so one of the things I say about trading is, you have to take the good with the bad.

Today is no doubt the bad. Having a day when you lose $16,000 is not gonna be the highlight of your year, the highlight of your month, it’s gonna take me probably a couple weeks to dig myself out of this hole. Granted if we have really strong momentum next week, I could make back 16,000 in one day. My best day is $40,000 of profit so it doesn’t mean I can’t bounce back quick.

But if you think about how I feel right now on the lows of- not only did I lose $16,000 today, I had a red day yesterday, I lost three grand so I’m now down 19,000 in two days. That feels very low, that feels very discouraging, feels very disappointing and it’s like dang what did I- why did I get so aggressive? Its the beginning of the month. This is when it’s time to build the cushion not swing for the fences. Momentum hasn’t been good the last three, four days you know, all these things are running through my head, but I stepped up to the plate, got aggressive and took this good size loss.

But when I look at my metrics, and we’ll just pull them up, this is what I do anytime I have a big loss. I mean really it’s like clockwork. I look at my metrics and I ask myself, what am I doing right and what am I doing wrong? These aren’t updated, I haven’t updated them in the last week but just looking at the big picture. Let’s step back and look at the big picture. Gross profit, $934,000 on trader view right now. $836,000, let’s just start back at January 1, 2017, filter alright 615,000 so be back around 600 grand, you look at the win/loss days. You look at the metrics and you start to feel confident that okay yes today was one of those days that is a little bit of an abnormality, it’s a little bit of a swing but this is life and I will bounce back.

I’m trying to find, the one I’m trying to find is my max draw down. Where is it, detailed maybe? Well I can’t find it right now but this isn’t always the easiest to use, but what I was looking for is- oh here we go. So cumulative PNL right here, that’s how much I’ve made, whatever since I started this account. So back here a year and a half ago, $500 in the account. Three days in I’m at $125, right and I’ve grown the account, grown the account, grown the account, had this long period of sideways consolidation I broke out of it, boom big move up. Sideways consolidation, a couple big red days through here as you and see, and move up. A big red day here and a move up. These are the red days, today I’m on a dip, I’m on a low and the low’s always feel worse emotionally than the ups feel good.

It’s like that emotional swing it goes deeper red than it goes up into the green, but today’s just gonna be another one of those dips and I’ll rally, and we’ll look back at this chart two months from now and I’ll probably be up here or something like that, and it’ll be like oh yeah I remember that $16,000 day, yeah I was a little too aggressive, I have my tunnel vision, I lost sight of the bigger picture, I got a little emotional but I bounced back.

So when I was getting started trading, one of the big things for me was diving into my numbers like this and asking myself what am I doing right, what am I doing wrong? By doing that it helped me during those periods where my account was kind of slimming down a little bit, it helped me shred the strategies that weren’t working. It helped me see, okay this is what I’m doing that’s not working, let’s say trading stocks over $20. That’s not working for me, so I’m gonna cut out those $11,000 in losses. I’m gonna trim it and I’m gonna focus on what is working, this area. The volume, what’s working being more aggressive, okay I’m gonna continue to be aggressive. What price range is working? Okay it’s- well that’s not price range, but you know what I mean, you just kinda keep narrowing it down until you’ve refined what really, really works for you.

Even once you do that and you’ve been trading for five years or whatever, you’ve been trading as long as I have, you’ll have days where you throw logic out the window and you give in to emotion. So today’s a day where instead of capitalize on the FOMO, I fell victim to it. I let myself be too aggressive and I got stubborn, I kinda said I can afford to hold through the pull back because my accounts big and blah, blah, blah, blah, and that makes you sloppy. I’m gonna come back and look at this thing tomorrow and Monday its probably at $8.00 and I’ll be like, dang it how am I the guy that blah, blah, blah, blah, but that’s the way it goes sometimes.

So you guys unlike a lot of the traders out there that show you the green days and never show you these red days, I like you to see both sides of the coin because this is the life of a trader. You’ve got ups and you’ve got downs and we try to take them in stride, but these are certainly not the easiest days. This is a very easy job from a physical perspective, right? It’s physically I just sit here and punch keys, skill wise it’s not that hard to learn really. You guys go through a 90-day class and you’ve got the skill to trade, that’s about it, it’s pretty easy to learn. The thing that will flare up from time to time are those emotions. The feelings of FOMO, the fear of missing out, the greed, the fear, all of that stuff. That’s what makes the market move and sometimes you’re on the right side of it, and sometimes you’re on the wrong side.

Today’s a day where I was on the wrong side, and I could have been profitable on every single one of my trades except for SLS, I could have been profitable on. On Jag X I got in at 350 and it went up to a high of- I got in at 250 and it hit a high of 320. I saw you guys saying yeah nice I made $2,000 on Jag X, I made this amount on Jag X, it’s because you guys were taking profit, I was being more aggressive. I was buying as it was going up.

CODEX, I was up $7,000 on this and I didn’t take profit, right? Some of you guys got in down here at $4.00, $4.15 on this little one minute micro pull back, which is a great entry, it’s one that we teach in the classes and you guys did well on it. I lost $4,300 despite the stock being up as much as it is. So it goes to show, having skill and going through the training and all that stuff, isn’t always enough. You’ve gotta make sure that your emotions are in check and today’s a day where I just, I wasn’t there 100%.

I was up late last night, I was doing emails until 2:30 in the morning, maybe that’s part of it, I mean that’s not that uncommon for me so I think it’s just a day where, I just wasn’t I don’t know the market wasn’t on my side. I was too aggressive and it’s the perfect storm that just went the wrong way. You try to compartmentalize it a little bit, you know just bottle it up into that little bottle, put the cork on and just bury it really deep. Right behind your heart, just deep, deep, deep there and it will come back at you in about 30-40 years and that’s alright, but for right now just bottle that up, just put it down there.

For me it’s kinda like, I just try to compare it to other careers and things like that. The Deadliest Catch when those guys, I mean think $16,000 for guys running multi-million dollar fishing operations, it’s nothing. They set an entire string of pods and they forget to bait them properly, and they have to go back and pick them all up, how much does that cost them in fuel and all this stuff, right? When they go and hit a sand bar and screw up their propellor, how much does that cost them to fix it? $10,000.

So it’s easy to personalize and to feel like oh my God this is mad but my business as a day trader, because I’m a self employed day trader, it’s a million dollar business, and this year if I have a good year I’ll be in I guess $500-600,000 range. Over the course of years of trading it’s made millions of dollars so yeah, I’m down 16 grand today. I’m not gonna try to brush it under the carpet and say it’s not a big deal, it is, but once you’ve reviewed it, once you’ve analyzed it, once you’ve given yourself the kinda break down of what you did right what you did wrong, you gotta put it behind you. You gotta get back on the horse, and that’s what I’ll do on Monday morning.

Anyways that’s it for me. I hope this is helpful for you guys, those of you watching on Facebook, watching on YouTube, give me the thumbs up for doing the video, throw comments below. I’ll come back and answer them through the weekend, and I’ll be back at it on Monday morning. You guys will keep watching over my shoulder and learning as we go. Learning from the ups and learning from the downs.

Alright so that’s it for me, I hope you guys all have a great weekend, get some rest, relax and we’ll be back at it first thing Monday morning. Alright see you guys on Monday.

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