June 4th

Not much to say today. Sort of a lazy uptrend with a range start and finish, so I don't think this really counts as a trend day. I stayed out of the SSO trades as I was expecting either a range or small move day as the volume was on the lower than average side all day until the EOD rush.

Note that the bars are closing in the bottom of the range.

Although the TICK could have been used for some upside trades I decided to not trade SSO as the moves were going to be rather small so my 100 share lots would hardly break even on a decent move. The upside was smaller than the downside so this was a test of my resolve to watch for downmoves. I hit one good trade and two small losers, one was a too tight stop issue as the idea was sound and the expected move was good. The wrong was really a speculative play for a reversion trade that did not materialize...then I called it quits for short (SDS) trades. I could use larger position sizing but I want to stick with 100 shares for a while yet.

I could have played other ETFs, specifically SPY for the upside moves but I was trying to avoid the downspikes that SPY exhibits. I expected that those would take out a stop. I see that may not be the case as if they did there would be a sudden huge runup of price as market orders were executed as other stops were also taken out at the spiked price...and I survived an SDS spike. Perhaps I do not completely understand what the spike represents. I recall getting caught and creating my own huge down spike on an old trade where I lost a fair chunk of change because of the spike. I think that the spike represents an anomolous fill and does not affect the bid/ask quote therefore the stop does not get triggered. I will rethink my staying away from SPY as a result.

I'll have to consider position sizing and price values when looking at SPY again in my risk management as I need to be playing both the up and down side of the market. SSO may still be a better play with 200 shares.

Jeff.