Friday the non-trading day

One of my rules has been to avoid trading on Friday's...that was when I was measuring results daily. I may change that rule now that I am into the daytrading. It was a slightly lower volume day and the price showed that by chopping around a bit more on the minute scale...perhaps the spreads were a bit larger but I never checked the intraday once today.

I did log in aftermarket to get an idea of what I may have missed. The morning was poor as it had gapped down about half of yesterdays' gap up and it looked like it tried to rally but failed at the S 1 pivot point from yesterday...hit it as resistance three times between 10 and 11. Once things got rolling the stock price mimicked the TSX well so it was a good indicator. So the gap yeasterday was essentially closed today.

Possible trades were many and small until after lunch. Estimated entries working the chart blind by minute would see me in long at 1004h for a 50cent gain then I would not have traded again until 1316h for a short gain of 90 cents...based on the flailing about for most of the AM I would have skipped the rest of the day anyway...

...having said that the setup for the afternoon short was nice and there were about six peaks that could have produced 20 to 40 cent gains per trade, too much work for a small position trade though. Worth noting (I'll stick a chart in here somewhere) the 200SMA on the minute chart swooped in after 1200h and acted as a resistance zone to correspond with the S1 pivot...what exactly drove the price down doesn't really matter as it dropped to $57.63 from about $59.70. That is one of those setups that I would jump on early as the price dropped below $59.30... basically where the low resistance of the morning was broken and it would be a keeper as it blew past the S2 pivot and stayed below the 30SMA all the way down.

I didn't have the time today to trade and certainly not the way the day progressed so I will not count this potential gain in my fake results... it would have been a $120 net day, certainly not my largest but a good day. 2.4% which is slightly above my goal range. I would take that.

The blue circles are the trade entry areas that I used. All those choppy peaks could have been shorted (to stay trading witht he overall trend down). That would match an aggressive method as that would put me in the trade short and only covering as the price bounced or showed signs of weakening selling pressure...this would have left me in the trade from the last peak as it plummeted through any support for a $1.60 or so profit. The true daytrader would have been in and out of this stock quite a number of times with a larger position for some decent profits...say 500 shares for 6 trades leading up the the drop for a total of $2 ps gain BEFORE hitting the big drop....perhaps a $3.60 ps gain at 500 shares for a a cool $1800 less commisions of maybe $80. I'm not certain that the volume today would have supported daytrades much larger than 200 shares though.

My aim is lower with 100 shares so I need slightly larger moves. This means that I am working harder for any gains. I hope, in the long run, that this hard work (if you can call this hard work)pays off when I can put larger positions in play, use the same strategies.

One thing that I need to investigate further is the difference in the action between the morning and the afternoon. The morning is quite choppy with more smaller sporadic but tradeable moves and high initial volume. I suspect limit orders and stop orders are triggered and this may drive a large part of the morning move...it would appear that a lot of people are losing money here...and some are making a killing. If I had to guess I'd say that most of this action is from small traders trying to get an early position or trying to dump (intentionally or not) and the bigger guys are just sopping up the remains...just a guess so far though.

JD.