Gordon Gekko says Greed is Good. He forgot to say that it doesn’t apply to traders!
JV is right. If you are up over 1$/share, you should cover. Yesterday, I was up by 384$ (1.28$/share) on my OPTR position. And here’s how I screwed it up today.
OPTR Trade 13th Nov
Well, from 384$ profit to 68$ profit.
Anyway, after my MYL trade, I had decided that if I feel strong about my short position and there is a spike, I should short more. After OPTR touched 7.87$, I shorted more at 8$, thinking it will go up more. Well, OPTR started tanking. I kept moving my price down but OPTR moved so fast. Finally when I shorted at 7.20, OPTR turned around and went to 7.6. Now, I got bit worried and put up cover at 7$ for 300 shares. It got filled for 68$ profit. 
What’s next? If you look at the volume closely, you will see that white candles have very low volume. All the red candles have double the volume. Also, overall volume for OPTR is fading (Last 3 days volume: 5 million, 1.77 million, 1.63 million) and I think it will lose the gains in days to come. I am actually now kicking myself for covering those 300 shares.
I am really happy about CHIC trade. Here’s what I did.
CHIC Trade 13th Nov
For CHIC, I tried OCO order with cover at 7.20 with entry price of 7.5. I am really happy with this trade. I waited patiently for pull back at 7.5 and exit price of 7.5 was reasonable. I knew that CHIC could fall further but I had to leave for work and I didn’t want to leave the trade un-attended and lose my profit. Total Profit: 162$ after commissions. BTW, yesterday I didn’t mention it but I had picked up CHIC from Adam’s watch list. Thanks Adam, you rock! 
I also covered MYL at 8.94 for a tiny 35$ profit. MYL cracked down in the morning as per my expectations and reached 8.80. But the pull back was very strong and I didn’t want to deal with MYL anymore. My main reason was that MYL is multi billion dollar company with 95% stock held by Institutional investors. The price movement didn’t feel right to me. MYL did go up to 9.15, cracked down to 8.10 and closing at 9.2. I am happy that I got out of MYL without getting hurt. NEVER EVER trade these big multi billion dollar companies!
Overall, not a bad day but there are quite a few things I can improve. One thing is that I should get back to using OCO orders. Main reason is that I can be trading only from 9.30 to 11. Once I am at work, I may or may not be able to keep a watch. In those scenarios, OCO order can protect my profits or cut my losses.
DOW moved up by 900 points after touching low at around 1pm. I think this big swing was the main reason, MYL and OPTR turned around. Anyway, I think that DOW will give back at least some of these gains tomorrow and there should be plenty of good short opportunities. Will post my watch list soon.
Happy Trading.
RJ.
Status as of end of Nov 13th:
Positions closed for Gain: MYL (35$), OPTR (68$), CHIC (162$)
Positions closed for Loss: None
Open Positions: Short 500 OPTR at 7.20 (Down by 50$)
3 responses so far ↓
1 YngvaiMalmsteve // Nov 13, 2008 at 11:15 pm
Yeah, $7.25 to near $6 is a 20% profit on your position. With something like that, it’s always good to take the profit. Also, it would’ve been good to take your profit on OPTR yesterday because the likelihood of a bounce was very strong. It fell from $8.50 to $6…that’s over a 40% drop. Thus, the likelihood of further downside the next day was very low. Plus, covering near an even $ number is always good as they tend to form natural levels of support and resistance.
Nice job on CHIC.
2 RJ // Nov 13, 2008 at 11:27 pm
Thanks Steve for your comment. Actually I didn’t even calculate % profit. I was simply waiting for OPTR to fall. And yesterday I was so excited seeing OPTR fall like a rock that I didn’t even think about covering it! I can not let excitement control me and leave my profits on table.
RJ
3 kanoe // Nov 14, 2008 at 1:49 am
Greed is definitely not good.
Nice play on CHIC.
Good luck with OPTR tomorrow.
I’m hoping it drops too.
I’ll get in with ya.
Happy Trading man.
_kanoe
Leave a Comment