A Scientific Approach to Trading

Week ending 5/16/2008

Saeed — Sat, 17 May 2008 06:35:33 +0000

Another week of no trades for me. The market appears to be in a short-term bullish move, though the medium-term trend is still bearish. This makes it harder for me to find good trades.

My account was unchanged and stayed at $11,516.23.

Week ending 5/9/2008

Saeed — Sat, 10 May 2008 01:21:56 +0000

Nothing interesting to report this week since I didn’t open any positions. It’s actually kind of nice to take a bit of a breather after the losses I took in the last couple of weeks.

My portfolio had no change and stayed at $11,516.23.

Week ending 5/2/2008

Saeed — Sat, 03 May 2008 06:14:19 +0000

This week was much more quiet than the last two weeks. I had one remaining position which was closed out for a loss on Monday. I wasn’t able to do any trading this week because I was in a class all week and I didn’t have access to a computer during trading hours. It was actually good timing to get away from the market for a week after the big losses I took recently.

This week my account went down $25.80 to a total of $11,516.23.

Sold 1 XLF Jun08 33 put for $5.90

Saeed — Tue, 29 Apr 2008 05:16:34 +0000

I bought this put on 3/26 for $7.40. My original exit level for a loss was set to $27.80, but I had lowered it to $27.15 as the resistance level went lower. Today it crossed up above that and triggered my exit order.

This position was up to $120 profitable at one point, but the recent upturn in the market cause this ETF to also go back up. There wasn’t anything I can see that I should have done differently on this trade.

Week ending 4/25/2008

Saeed — Sat, 26 Apr 2008 05:51:55 +0000

Only one word to describe this week: Ouch! Most of my positions closed for a loss, including a new one that I opened this week on MER. Since last Wednesday when my account peaked at over $12,700, I’ve lost about $1200.

This week, my account went down $625.03 to a new total of $11,542.03. This was by far my worst week ever. I also had my worst ever day with a $494 loss on Thursday.

Other than the mistake I made in not getting out of TRN when I saw the new support level, I don’t think I made any bad trades. I just got hurt by the sudden upsurge in the market when I was holding all puts.

It is rather disappointing to lose 2-3 months of profits in one and half weeks. On the other hand, it’s good to know that with all of my trades going against me, I still only took less than a 10% hit on my portfolio. So at the very least, my risk management and money management rules are working for me.

Sold 1 TRN Jul08 35 put for $5.60

Saeed — Sat, 26 Apr 2008 05:44:34 +0000

I bought this put on 4/4 for $8.60. It went up as high as $10.50 before the stock started to shoot up and finally broke through my loss exit level of $28.75 today. The stock actually traded as high as $29.58 today.

The unfortunate thing about this trade is that I had recognized that there was a potential support level at around $23.75, but decided to leave my original exit orders in place. It turns out that was about a $500 mistake.

Sold 1 MER Jul08 55 put for $7.75

Saeed — Fri, 25 Apr 2008 05:09:08 +0000

I bought this put on 4/22 for $9.80. The put was actually doing nicely as of yesterday, but today the stock surged up over $4.00 at one point. It reached a high of $49.24, which took out my loss exit level of $48.70.

Bought 1 MER Jul08 55 put for $9.80

Saeed — Wed, 23 Apr 2008 03:26:47 +0000

This stock has been in a downtrend since last May, and I traded an earlier bounce off a resistance level earlier this year. Since then, it has broken the trendline it was using as support, and is now using that line as a resistance level.

The stock has come up to this line again and bounced down, with confirmation from the MACD and stochastics. The stock actually closed the day up $0.09, but it was down by about $0.10 when I entered the position.

The stock is currently at $46.50. Support is around $38.15 and resistance is around $47.25.

My exit orders are:

Market order to exit if the stock trades above $48.70
$0.10 trailing stop loss if the stock trades below $39.30
Stop loss on the option at $4.50

Sold 1 ADI Jun08 35 put for $3.50

Saeed — Wed, 23 Apr 2008 03:21:12 +0000

This trade actually happened yesterday.

I bought this put on 4/8 for $5.40. My exit price for a loss was set to $32.15. Yesterday, the stock went up as high as $32.73 and took out my exit order. It has sinced bounced back down off the higher resistance level, but I was trying to trade the earlier bounce which did not pan out.

Sold 1 WSM Aug08 35 put for $7.70

Saeed — Wed, 23 Apr 2008 03:18:11 +0000

This trade actually happened yesterday.

I bought this put on 4/7 for $9.50. My exit price for a loss was set to $27.75, which the stock took out yesterday. It turns out that since I was using the 200-day moving average as the exit point, I should have set my exit a little bit higher. Today, the stock fell back down by over a dollar.