Wow. 3 months of paper trading don't compare to how much more I've learned on real money. I used 3 trades on 2 different securities over the past 5 days, all short plays.
First short was PMI. I sold at 2.84. This was really a bad trade. It was unresearched and really just me betting anxious because my account was funded and I wanted to try it out. The stock was in the red and I thought a tank was in order even though other financials weren't going south. I did it anyway. Set my stop at 2.85 and once it cracked, I was in my first trade in the stock market. It did well. It tanked and I bought back at 2.78. Only 500 shares so my order wasn't that big and I wasn't seeing big enough movement for this to be worth commission and more importantly MY LIMITED trades. I have learned very quickly that I need to invest more and see big movement. So it was before 10AM and i had a small gain on my first trade ever. I wasn't going to settle. I thought this would fall again. So minutes later I re enter. Day trade number 2... gone. I sold off at 2.78. Totally uncalled for. It ran up and was soon over 2.80. I had definetly given back my gains since commissions are so steep with such small positions. The one good thing I did was use good stop losses. I limited my loss to 1% by setting my buy stop at 2.85. It hit and I ended my first day trading down 45$.
Lessons learned: Research is a must whether you want to take big positions or not. I have a small account and commissions will be my enemy.
My ego was bruised. But becuase I'm such a cheapskate I took this very personally. I was not going to allow myself to act this way and burn money. I wanted my money back and I knew I had simply acted poorly.
My next trade wasn't untill 3 trading days later. Yesterday I saw out DLIA on the % gainers list.
Dark side's picks weren't showing the morning action I like and the chat room was moving too quick for me as usual. I saw that DLIA had a good day after an earnings pump. So far the stock was hovering around the day before's close so I saw short potential and put a sell stop two cents under the day befores close. I waited and waited with my sound on high in case I wasn't staring at the char the moment it fell. I had a good feeling it was but after 2 hrs i was starting to lose hope. I kept waiting, even showered. Suddenly I heard that magic TOS trade execution noise. It tanked... hard. It fell so quick my stop wasn't executed until 5 cents later. at 2.43 I was short 1000 shares. It dipped to 2.20 realy quick and I had to take a share of my profits so i did. Within 30 seconds of hearing the noise that the order went through, I was out half of my postion in DLIA. I was sitting on nearly 50$ of profit but then it hit me. Or rather the TOS software told me so quickly. I had just committed my third and last day trade but was still in my short 500 shares.
Another lesson very quickly learned. I can't do this!!! i'm in a 5K account. I need to sell at once to conserve trades. Opportunities are every day. I gotta have trades ready. I started freaking out and explaining everything to Cameron, while also chatting with GS from the GOTS chat room who explained that I was still ok. I could buy back the rest of my position and still not be in offense of breaking the pattern day trader rule. All i had to do was call up TOS. I quickly had the trade re-credited to my account but DLIA had shot up. It was now around 2.55. Again I was losing my gains and commissions were tearing away at them as well. I set a stop loss at 2.61 thinking it'd have a hard time breaking 2.60 luckily it never got that close. I held for the rest of day and saw it fall to 2.45 right before close. I set a buy stop at 2.50 during after hours thinking it'd help my prevent losing more, which was totally correct but i have not experience with how after market trading worked. During aftermarket I saw a 2000 bid and a 2.10 ask on my poor little DLIA stock. I was confused but some GOTS fellows assured me it was normal. What i didn't know was that a wacky bid ask would be introduced at the open and sure enough my order went trhoug at the bell since the bid was 2.41and ask was 2.57. Some how I bought back the rest of my postion at 2.41 and I netted 30$ post commissions. I'm now sitting at $4881.01 with many lessons learned. I think that I did ver well with these first trades
I thought if i went red on my first trade i'd be devasted. I've realized that I really do have to wait for the perfect opportunity and not stress over that fact that i'm putting 5 grand on the line with my bets. I don't crunch the numbers like they are dollars, just points like they were on my paper account. With that, i'm ready for some fresh opportunties tommorw.
No picks at the moment. Research will be done in the morning.
Plenty of picks for you on Darkside, TIM, MIKE, and super-trades, as well as Yngvai.
Yeehaw
