Warrior Trading Blog

A Trading Curse or a State of Mind? +$3,603 This Morning!

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A Trading Curse or a State of Mind? +$3,603 This Morning!

 

What’s up everyone? All right, so I’m finishing the day today up $3,603. On the surface that’s a great day, but before we get into today’s midday market recap, I want to talk a little bit about not comparing yourself to others because this is something that I struggle with from time to time. Over the weekend I was on Twitter and I saw in the first week …

What’s up everyone? All right, so before we get into today’s … What’s up everyone? All right, so today I’m finishing the morning up $3,603, which is, on the surface, a great morning. Before we get into today’s midday market recap, I want to talk for a minute about not comparing yourself to others. Over the weekend I got myself a little bit frustrated because I saw on Twitter that there were some traders that made a lot more than I did last week. Last week I finished with about $22,000 in profits. Again, on the surface that sounds really good. Then, when you see someone who made $100,000 in that same week, you can’t help, at least I can’t help but feel like geez, I need to step it up, I’m not making the most of these opportunities, I’m not being as aggressive as I should. You can start to feel a little down about yourself.

What I told myself over the weekend, as I was sort of reading those Tweets and thinking about it is, I was like, “You know what? On Monday morning I’m just going to start with 8,000 shares, I’m going to start with 10,000 shares. Maybe I’ll take a 25,000 share trade and make two points in the trade and be up $50,000.” That’s getting into swinging for the fences. When I do that I almost always get myself into trouble.

Here’s the deal, at the end of the day, at the end of last year I finished in really, really good shape and it wasn’t by getting really aggressive and trying to really swing for the fences, it was mostly thanks to slow and steady, being really consistent, closing the majority of my days green. Even if it was only $1,500 or only $3,000 because over a span of 12 months all of those days add up to $250,000, $350,000, $400,000 in profits. Yes sure, it would be really nice to have one week where you make $100,000 or $150,000, but you also have to remember that a lot of the traders that are that aggressive are also going to have equally big or at least very large losses. We don’t always see the other side of the coin. People like to show what they want you to see, so it’s the same with social media. It’s a curated experience. Very carefully curated lives that people project on social media.

A lot of traders will project just those big green days because that’s how they want you to look at them. It’s no criticism towards them for doing that, I get it, a lot of people do that. I do something a little different, which is I post all of my winners and all of my losers. I do that because I want you guys to see both sides of the coin. My hope is that you guys will see the days that I make a lot of money and that’s awesome, but you see the balance, you also see the days where I lose money and where I’m frustrated or bummed out or whatever, so you realize that it’s not all green.

For me, not comparing myself to others is something that I always have to work on because I want to be the best trader I can be. I don’t want to be the best trader in the world. I don’t need to be the best trader in the world. It’s one of those things where there’s always going to be someone out there who’s better than you. Whether it’s better at trading, or better at whatever it is you do as an artist, or as this, or as that. There’s always someone out there who’s going to be better. There are very small handful of people in the world that are literally the best at what they do. If you set that as this is what I need in order to be satisfied with myself, well most likely you’re going to fall short and you’re not going to be happy.

Living a happy life means I think not comparing yourself to others so much. Instead, if you want to compare yourself to someone, compare yourself to yourself. For me, this year, my goal isn’t to try to make $10,000 a day on average and finish the year with $2 million in profits. I’m not going to set the bar that high and then come up way short and be disappointed. What I want to do instead is look at last year. Last year I was averaging about $1,700, $1,600 a day. This year I’d like to average closer to $2,000 a day, maybe $2,500 a day because I know that if I average $2,500 a day I will almost double my profits from last year. Instead of making $350,000, I’d be making closer to $600,000, $700,000. If I could do that again the following year and increase my average to $3,000 a day or $4,000 a day, then maybe in two or three years I’ll be making $1 million a year.

Let’s compare myself against myself, and I encourage you guys to do the same thing. Right now we’re at the beginning of the month and there’s that kind of urge to try to have a really great month. When you see someone else out there who’s doing better on the month than you are you can kind of feel like dang it, he’s already in the drivers seat on the month and I’m still trying to get things going. Just remember, slow and steady wins the race. If you want to be a trader and you want to do this for the long haul, you can’t swing for the fence. Swinging for the fence is what strikes you out, that’s what blows up accounts. You have to focus on taking profits when you have them, and remember that every single day that you close green, even if it’s only $100, if you’re making $100 consistently, you’re doing something nine out of 10 traders haven’t figured out how to do. You’re really doing a great job.

Now for me, making $22,000 last week, that was a great week. Sure, it’s not the best week any trader’s ever had, but for me it was a good week and I’m happy with that. I really encourage you guys to do that kind of moment of reflection and have that presence of mind when you start noticing that you’re comparing yourself to others, to kind of bring it back to let’s just compare myself to myself. Because comparing yourself to others I really don’t think it’s the recipe for a happy life. With all that said, let’s get into today’s midday market recap and break down our trades from the morning.

All right, here we go, let’s go over the trades from this morning. Overall pretty decent morning, finishing up $3,603, so let me drag this up and you guys can take a look at my P&L. For sure I was a little cautious this morning just because last week was a great week, a really good start, and I wanted to just continue to build that cushion. Even though I had that moment over the weekend where I was telling myself to be really aggressive, I was able to bring myself back into focus before the bell and say, “Let’s just start by kind of easing into the week.”

I kind of feel like Monday morning after the weekend is kind of like going back to the gym after a couple weeks off and you don’t want to go full force right away, you got to loosen up, ease your way in, and see if it’s going to be a good day. If it is then be aggressive, but you don’t want to start pushing too hard because then you can get yourself into trouble. Today with my trades I kind of wanted to test the water and see if we were going to have nice opportunities this morning.

My very first trade, as you can see here, let me scroll up, was on MYZS. Now this one was MYSZ, this was one of our leading gappers and it was definitely a stock that I thought had some good potential. You can see it had a pre-market high of 2.65 and then it pulled back a little bit. I was watching this as soon as the bell rang for a possible break of the pre-market highs and I ended up getting in, because it opened right underneath the half dollar, I got in right at 2.50, 7,500 shares and it popped up and broke over pre-market highs. I’m in at 2.50 and selling through 2.67, 2.70 and 2.68, so my very first trade right out of the gates 20 seconds into the day, I’m up $1,300. That was a really solid first trade. It was pretty easy, low risk, I was a little aggressive on share size, but pretty much doing what I would usually do on this and actually this is interesting because it shows that I got in right before the bell rang. I don’t remember doing that but I guess we were right at the cusp. Right in there at 2.48, 2.50 and then selling as we squeezed up. That was my first trade, $1,200.

Second trade, I lost $1,200. That was on NURO. I jumped into this one right off the scanners and this is kind of crazy today, the action we saw on this stock. I jumped in at 2.05 right out of the gates, it hit 2.06 and then dropped down to 1.85, so I’m in at 2.04, 2.02. I stopped out at 1.86, quick loss just like that. It ended up doing it again later. It popped up to 2.19 and then dropped all the way to 1.67, that is brutal, a really quick drop. I didn’t get in on the second one because I saw it hitting the scanners and I was like no, I’m not going back into that one, it already fooled me once, I’m going to leave it alone and I’m really glad I left it alone because that could have ruined my morning.

Now I’m up only $60 on the day after that NURO trade. I went from being up $1,200 to up only $60, $70. Next stock to hit the scanner was DELT, D-E-L-T. Now on this one I felt confident being a little more aggressive because it made a big move yesterday. Now I was a little iffy about the fact that it sold off as much as it did Friday afternoon, but as it was squeezing up here I figured it was definitely worth a stab. I jumped in at 2.50, rode the momentum all the way up to a high of 2.89, $2,023 profit. That got me back into the green. That was DELT, again on this one jumping in at the half dollar. I go for entries at half dollars and whole dollars and obviously I buy on pull backs, but this one was a good entry at the half dollar. DELT nice trades on that one.

Next one CNET, CNET is another stock that was really strong last week. As I saw this one popping up again I jumped in, where did I get in, right just over the half dollar, so 2.54, 2.57, my average was right around 2.55. I got in there, I added at $7.00, selling at 7.02, 7.04, and then I sold the rest at 6.79, another $1,400 of profit. With that I got myself up to right around $3,500 and my very last trade of the day was on MYSZ, getting in at 2.67 for the break of high of day. This one curled up, it tapped, came just under high of day and so I jumped in it right here at 65. Ended up squeezing all the way to 2.89, I didn’t really do as well on it as I could have. I got a little nervous and got back out at 2.68. Small little trade there, add another $50 or whatever.

Overall today we saw pretty decent action. Aside from that one drop on NURO, the market was pretty clean. I had a total of five trades today and I’m green on four out of the five. My average percentage gain was 4.5% today, my average winners were $.15, and my one loser was $.17. It gives me accuracy of 80% with a roughly one to one profit loss ratio. Not bad, I mean obviously I’d like to keep stops tighter than $.17 but neuro just dropped really, really fast so I just wasn’t able to get that stop any tighter.

Here we are, this is the fifth day of the year and I’m up right around $25,500 on the year. Five days in, daily average is $5,000 a day. Now I talked a little bit in my intro to this midday recap about daily averages. Last year my daily average was $1,600, right around there, which was good. I mean I’m happy with that, and so my goal this year isn’t to try to have a $5,000 average for the entire year. I don’t think that would be realistic to try to grow my daily average by 300%. I’m not going to be able to grow it times three. If I can have my daily average be closer to $2,000 a day or $2,500 a day I’ll be closer to $600,000, $700,000 in profit this year. That would put me in line to break over $1 million this year.

I started last January with $583, as of today right now my account is at $361,000. I’m 36% of the way there. The goal is $1 million, and in order to cross that line obviously I would need to make over $640,000 between now and the end of the year. That’s setting the bar pretty high, but if we just do the math, what is $640,000 divided by 230 trading days left, would be a $2,700 daily average. Again, I think that that’s going to be a little too high because I expect we’re going to have months that are going to be slow, there will be points where things we’ll be lucky to make $500 a day, but if I can stay focused on trying to keep my averages as high as possible, then I think I can be in pretty good shape. That’s what I’m hoping for.

Eugene, to answer your question last year I made, let’s see, around $370,000, $400,000 total. Commissions were about $50,000, so $380,000 or whatever was my net. If you add the $50,000 in commissions that’s what I made gross. Anyways, commissions are maybe 15% of my gains go to commissions, and it’s not based on percentage, it’s just based on per share and per trade, but it ends up being around 15% or so.

The goal this year is to try to be as consistent as possible, try to boost up that daily average. If I can do $2,000, $2,500 a day that’s awesome, and if I break the million mark in early 2019 I’m fine with that, that’s totally okay. I don’t need to hit that in two years. To take $583 and turn it into a million bucks in two years would be pretty crazy and it’s going to take more than a home run to get there. I need to be really consistent, I need to keep my stops as tight as possible, I need to stay focused, trade smart. That’s kind of where I’m at right now and today was a day that I came into the market, stayed pretty focused, and was able to come away with $3,600 in profit.

We’ll do it again tomorrow and I’ll trade in the morning, tomorrow afternoon I’m going to fly to California, and then Wednesday morning I’ll be trading from California. I’ll be trading on my traveling trading station but it will be business as usual, pre-market analysis starting around 9:00, 9:15, and then getting into trading as soon as the bell rings at 9:30.

Justin, yes so when I start trading in the IRA I’ll be sharing those trades as well. I’ll be basically trying to trade in two accounts at once, which I’ve done it before, it’s a pain, it’s not easy, but I will do it. For instance I might say okay, I’m getting in MYSZ right now and I’m also getting in in my IRA. I’m in with my IRA, but the thing is I can only take three trades a week because I’m only going to have about $10,000 or $11,000 in the account. I’m below the $25,000 minimum. Three trades a week I’ll probably trade once on Monday, once on Tuesday, once on Wednesday, just do one trade a day. Although I could do all three trades in one day and then not trade for the rest of the week. I guess it just depends on what type of opportunities we see.

I’ll have one entry and one exit because I can’t scale out with the PDT rule because each one of those sells counts as one of my three trades. Yes, I know the time zone so pre-market analysis will be 6:15 for people on PST, but I just keep myself set on Eastern Time because even though I’m in California I’m still trading and doing everything on Eastern Time Zone. With the IRA I’ll be limited for the first month or two until I get myself over $25,000, and then from there I’ll be able to trade a little more aggressively.

The thing with trading in an IRA is that you can’t short stocks number one, and number two you don’t get any leverage. If you have $10,000 in there, you only have $10,000 in buying power, you don’t have leverage times four. If I put in $25,000 I only have $25,000, I don’t have $100,000. That’s the drawback and then the other drawback is that I can’t take out the profits until I’m 60 years old, but I don’t mind trading in two accounts. I can trade with my main account for money that I want to take out, and I can trade a little bit in my IRA account for money that I’m just saving and that’s totally fine, I’m okay with doing that. That’s kind of the game plan. I’ve been working on getting it set up. I’ve got to call Interactive Brokers again today, we’re just trying to get my old IRA rolled over into their account and it’s just going to take a little bit of time.

Now the cool thing with Interactive Brokers is that you don’t have to wait for trades to settle, you can trade immediately. They call it IRA margin, and basically it’s like margin times one. You don’t have buying power, but you can day trade as much as you want once you’re above $25,000. Below $25,000 you’re still limited to only three trades a week because it is a margin account, so I’m limited on my trades, but we’ll just see how long it’ll take me to get from $10,000 to $25,000. Hopefully I can do it as quick as I can, hopefully we get a couple of 100% movers, I buy 5,000 shares of a stock at 2.50 and sell it all at $5.00. I do that a couple times and I’ll get myself up pretty quickly, but it’ll be a little slow going for the first month or two and then once I get over that level I’ll be in really good shape.

That’s Interactive Brokers. Interactive Brokers and TD Ameritrade both give you margin on IRA accounts, so that’ll be nice. Commissions I don’t know what they’re going to be, but I’m not really that worried about it, it’ll just be regular commission rates. That’s coming soon in 2018, just waiting for stuff to get setup there and things take a little while to get transferred over. In the meantime just focused on trying to be consistent and keep those stops at tight as possible, and focus on trading the first hour. The first hour is when things have been really the best, so get in, get aggressive, and then look, my last trade was at 9:50. I didn’t even trade past the first 20 minutes, so 20 minutes and then I’m done. That’s really what I like, just to get in, get some profit, get out, and do it again tomorrow.

Anyways, that’s the game plan here. I hope you guys have all had a decent start to the week. It seems like some of you did pretty well on DELT and MYSZ, especially and hopefully you didn’t get beaten up too much on NURO if you did trade it. We’ll be back at it again first thing tomorrow, hopefully we see some more good opportunities and we can keep building up that cushion on the month and on the year. All right everybody, so that’s it for me. I’ll see all of you back here first thing tomorrow morning, pre-market analysis 9:00am, 9:15, so I’ll be trading in the morning and then flying in the afternoon. All right, so that’s the game plan and I’ll see you guys back here in the morning.

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