High volume trading, for me.

I decided to have another go at high volume trading today. I tried it once before and it was a dismal failure. This time I didn't do so bad. I gained in straight performance but lost in the end due to the commissions.

I won't give a blow by blow but there were 13 trades, done by shortly after 1100h. I grossed 0.63% but netted (-3.6%) or so.

The long and short (punny,eh?) seems to be that there is a mentality that lets me think that I can get away with more speculative trades as I have more trades to make up for any small loss...it just does not work that way. I got sloppy.

Largest loss was 33 cents off the start, not a nice way to set the tone and my largest gain was 42 cents. I think that if the earlier trades had gone better I might have stopped after reaching my goal.

Trades before commissions

(-0.33)
+0.28
+0.22
(-0.04)
+0.29
(-0.19)
+0.00
+0.42
(-0.20)
+0.13
(-0.05)
(-0.13)
(-0.21)

Average losers : -(0.164) per trade
Average winners : +0.225 per trade.

At this rate I would hit zero at 491 trades due to commissions... theoretically, assuming that the stats remain the same and I lose as often as I win. The worst thing about today was at no point could I have stopped and even broke even after commissions.

The one thing that did come of the morning was a little more nimble action on the limit orders. I got some good entries where I wanted them even if not all moved the way that I wanted. I almost played with the trailing stops but I never got the price far enough in the green to let me dink with the order settings.

I should get into the habit of setting some sort of stop at the time the order is placed in order to keep from taking a horrendous loss should a connection drop out and the price do something weird before I can get back in to exit the trade. I have mentioned trying this and it would feel good that have a real stop in place sometimes even if to keep me from letting a profit turn into a loss as I move the stop up to trail the price.

Each day I feel more and more comfortable with the prospect of trading. I do not get the same butterflies and sweaty palms that I can recall from the beginning. Today I was rushed getting my pivot points plotted amd I had two interruptions that I can blame for one loss and for one premature exit, but that looks like it is just part of the game for me I guess.

Comfort and calm will prevail and this leads to the patience to let the prices come to me. Missing an entry is no big deal and not worth chasing a price to try to "get in" on the upcoming move.

Quick notes about a couple of trades. One was a nice setup that I got in on, my second or third trade, and I missed out on the $1 or so move due to someone asking me questions, divided attention, so I got out earlier than I would have liked and gave up about 60 cents possible profit. I jumped on the short at the top...might have been one false start or I might have my trades in the wrong order, but I picked up a nice pullback playing against the newly established uptrend. I cannot help but play against momentum moves as they lose their drive. The pullback is so sweet and easy as long as the getting out is timed very well as these are very quick small targets, keeps me on my toes. They can reverse very fast if not careful but in and out fast is the plan so there is no holding them to see what happens. I held one or two of those today.

The switch at the bottom is my downfall, I can call the bottom and get out but getting the reverse trade in right away tends to escape me...I would love to be able to enter a double trade but Questrade does not allow it through the platform.

It would play like this....enter a long position of 100 shares, ride the momentum, then place a sell for 200 shares at the peak, perhaps a limit order. This would exit the long position and short sell 100 shares automatically. Then as the price swings to the extreme again, place a buy for 200 shares to cover the 100 short and buy 100 long...repeat until satisfied.

This would work well for me as I like to time the peaks and troughs to catch the next rally or pullback if the target is large enough. It works the same as my old CTP as I would be at the bottom of a rally should the price break the pattern in my favour, and if not I reverse the trade while taking a profit...the other advantage would be trade reversal on the fly...exit a move against me to still catch the remaining momentum.

I think that a discount broker cannot do this due to some chance of one part of the order not being filled, ie a short position entered and the long not exited due to timing or market sentiment. I already know I am not allowed to hold a long and short at the same time or sell more shares than I have. Oh, well, I still have to play it normal I guess.

Jeff.