Tuesday, September 28, 2010

9/28/2010 Over Trading

Hello Traders,

Hope you all had a profitable day! I walked away with a measly 10 ticks. However I screwed up big time. Wondering why?? Because I over traded. Half of my profit was eaten up by commissions. I realize my mistake though. I'll work in the future to minimize my trading by only taking trades at pre-defined, low risk areas. Let's go over the trades, the losing ones are circled in white.

On the first losing trade I tried to fade the initial support area at 1037.50 and support failed. I took a 6 tick loss and looked for another long around the Globex low at 1131.50. The counter trend move netted me a point and I went running before consumer confidence came out at 10:00am EST. I completely missed the long off of 1128.75. That would have been the trade of the day! During my next two trades I was fighting the Federal Reserves POMO auction. I kept trying to fade previous support levels but the money printing machines were too much to handle and kept driving prices higher.

In the afternoon session I expected price to roll over. I took a short too early and got stopped out for another 6 tick loss. After the double bottom that formed I should have known better than to short. Then, of course, price reverses and goes my direction. I was not very happy about that trade. On the next trade I lost a point because of another missed entry. Except this time I wasn't going to let the market run away without me. Once enough shorts were on board they squeezed them hard, giving me my best gain of the day, a 2 pointer. I got out before the 1140.00 IB high only to watch price continue to move in my favor. Everyone was eying 1144.50 as a potential target and momentum carried the market to 1146.00 which was the overnight high. I got short at 1145.25 for another quick point. I didn't want to overstay my welcome with 10 minutes left in the cash session.

Over trading is just plain dumb. I know better than to be making that kind of mistake. I'm very disappointed in my trading to say the least. Some levels to do business tomorrow are the Globex high from Sunday 1149.75, and the open gap at 1147.75 on the upside. If prices fall below 1136.00 I'll look for longs around today's low 1128.75 and then the open gap around 1120.

Good luck tomorrow everyone!


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